music_news 91 posts

Music publishing companies representing Eminem filed a multimillion-dollar lawsuit against Apple on grounds of copyright infringement. Allegedly the iTunes store have been offering Eminem’s songs for download without his permission, only having the consent of the EMI record label. According to the singer’s lawyers, the record label doesn’t hold the right to allow downloads exclusively (as it is with selling the artist’s CDs). Also the singer wants a fairer division of the revenue from downloads. At the moment iTunes charges around 99 cents a song, 70 cents go to the record label. It, in turn, typically, pays 9,1 cents to the music publisher.

According to the artist’s lawyer the issue “is how the 60.9 cents the recording label has left after it pays the music publisher should be divided between the recording label and the artist. If downloads are treated as licensing agreements, the 60.9 cents would be split equally, he said. But if a download is treated as a sale, which is typical, the artist only gets a royalty, or a much smaller share... read more

Apple has announced on Tuesday that its iTunes store has sold more than three billion songs. This makes it the world’s largest online music store. Also iTunes “recently surpassed Amazon and Target to become the third largest music retailer in the US”.


Read more:
iTunes Store Tops Three Billion Songs, Apple

In his interview to Reuters, Steve Jobs, Apple Inc. CEO spoke against music subscription models and promised that the iTunes store would not introduce them despite the pressure from the music industry. “People want to own their music," he said.

Subscription models are actually a way of renting music and bring recurring income to the music companies. However, “customers don't seem to be interested in it” and [such] “model has failed so far," Jobs said.

He also expressed confidence that half of the songs offered on iTunes will be in DRM-free format by the end of the year.

Read more:
Jobs says Apple customers not into renting music, Reuters

On April 02 EMI announced that its catalogue would be available for downloading without DRM. iTunes “ a true pioneer” will be the first on-line store to offer CD quality downloads without DRM which could be played on any device. According to EMI’s CEO this move reflects the current “consumer demand”. A track will cost about $1.29 in the highest quality. Also customers will be able to upgrade the files they already have downloaded to a DRM free mode for a mere $0.30.

According to the corporate press release announcing this historic decision “new premium downloads [will be offered] for retail on a global basis, making all of its digital repertoire available at a much higher sound quality than existing downloads and free of digital rights management (DRM) restrictions.” EMI believes “that offering consumers the opportunity to... read more

The music industry met the Apple’s proposal to abolish DRM with no enthusiasm.

Rather music executives pointed to Mr Jobs that interoperability is the issue and that Apple shouldn’t pretend its all labels’ fault when European consumer protection bodies outlaw iTunes for its proprietary DRM. IFPI commented that contrary to Apple’s CEO argument interoperability won’t be that disastrous to quality control and security. The Apple’s appeal to the labels that they are selling 90% of their music without DRM protection anyway was rejected with indignation.

The Norwegian Consumer Council which had recently declared the iTunes store illegal was not impressed either with Apple’s efforts to shift the blame on the labels.
... read more

Yesterday Steve Jobs, Apple’s chief executive posted an open letter on the company’s site in which he defended Apple and put all the blame for the inefficient DRM system on labels.

Jobs denies that Apple tries to lock customers who bought iPods into using the iTunes store and hasn’t been using its DRM system for that purpose. He argues that on average there’s 22 songs purchased from the iTunes for each iPod ever sold. However, average iPod now holds around 1000 songs. Thus users are not being locked into the iTunes store as 97% of their music comes from elsewhere.

Moreover, Apple sees abolishing DRM as a way forward as neither the current situation with many proprietary music stores nor opening its FairPlay standard will work. “Imagine a world where every online store sells DRM-free music encoded in open licensable formats. In such a world, any player can play music purchased from any store, and any store can sell music which is playable on all players.... read more

The Norwegian consumer ombudsman ruled this week that Apple violates consumer protection laws because songs from the iTunes store can only be played on iPods.

The issue should be resolved by 10 October 2007. Apple might open its code to other producers; abandon DRM or jointly develop some new protection system. If the company doesn’t find a solution then the issue will be taken to court with a possibility of closure of the service in Norway altogether.

Some European countries might follow Norway in this action against Apple (Germany, France, Sweden and Finland). The Dutch ombudsman has already “… lodged a complaint not only with the newly formed Dutch Consumer Authority (ConsumentenAutoriteit), which will act as the enforcer of 15 European consumer protection directives, but also with the Dutch anti-trust agency”. (The Register)

Apple responded that it’s “…aware of the concerns … and hopes that... read more

A recent report by Forrester Research titled Few iPod Owners Are Big iTunes Buyers  reveals some pessimistic findings about the iTunes service.

2,700 US iTunes debit and credit card transactions had been analyzed over a 27-month period and it turned out that only 3% of online households in US bought music from iTunes in 2006. In the past year an average user spent $35 in the iTunes store. Half of credit card transactions were less than $3.

An average iPod user has bought 20 songs since the launch of iTunes.

The report also claims that since January the monthly revenue of the store has fallen by 65%.

Apple shares fell 3% after the report. Shortly after another paper  was released by Piper Jaffray this time confirming “strong... read more