By Ina Fried, 6 August 2004 12:10
NEWS French online music store Virgin Mega has filed a complaint against Apple, claiming that the company's refusal to license the copy protection technology used in its iPod is harming competition.
The action was filed with the French Competition Council in June and disclosed along with several other legal matters as part of Apple's quarterly filing with the US Securities and Exchange Commission.
According to the filing, the online store, part of the Virgin family, is seeking various unspecified "interim measures," pending a decision on the merits of the case. A hearing on that request is expected in either October or November, Apple said in the filing.
An Apple representative declined to comment further on the Virgin dispute. A Virgin representative was not immediately available for comment.
A number of media companies, most prominently RealNetworks, have called on Apple to open up its FairPlay digital rights technology so that other digital music services can securely transfer files onto Apple's iPod player. FairPlay blocks people from making unlimited copying of songs but also makes sure that the iPod doesn't work with any other kind of copy-protected formats.
Apple has refused to unlock the software for other companies. Last month, however, RealNetworks released "Harmony", which it said is copy protection software engineered to be compatible with FairPlay that will also enable music purchased from Real to be securely transferred to and played on an iPod.
Apple has criticised the move as akin to hacking and warned that it could always break Real's approach in the next software update to the iPod.
Also in the SEC filing, the Mac maker noted that it has settled several actions, including a lawsuit with Tibco over the Rendezvous trademark and another suit over the technology used in the Apple PowerBook to make the keyboard light up. The company did not offer details but said that in both cases, the settlement would not have a material impact on its financial results.
An Apple representative declined to say what the impact of the Tibco settlement was and whether Apple will continue to use the Rendezvous name.
Separately, Apple has brought an end to a legal dispute over the iTunes Music Mtore, E-Data announced. The iPod maker has agreed to license patents from E-Data, which says its owns intellectual-property rights to the process of selling music online. Microsoft has also settled with E-Data.
Apple expects to capitalize $5m worth of research and development costs related to its development of Tiger, the next version of the Mac OS X that is due out next year, the company said in the filing. It also anticipates recording about $5m in restructuring costs related to vacating certain European sales offices in the current quarter.
The filing also stated that if Apple had included the cost of stock-based compensation as an expense, its earnings for the three months ended 30 June would have been nine cents per share instead of the 16 cents reported in third-quarter earnings.
Ina Fried writes for CNET News.com
Comments
There are 6 comments. Join the discussion
1. Dan Isley
Screw Virgin Music,
Apple put in hard work and lots of money on developing the iPod and iTunes. They would not be in business very long if every hit Apple comes up with everyone wants them to unlock it and give it away.
Everyone always criticize the Mac, but they always want the innovations Apple comes up with. Go and get your innovation from Microsoft. If I remember correctly Apple had to live without Microsoft opening up their code and Apps to Mac users, it called a competitive advantage - moneymaking companies tend to do these things.
2. Ronan Donohoe
Apple has the worlds best digital music player.
Apple also has the worlds best digital jukebox.
Both work seamlessly together.
Why should Apple bother letting other companies make money off their back and cause problems for others?
Why would anyone with an iPod bother using another store than the iTMS? It has the most tracks (as far as i know), best features, best pricing etc., etc.
Sounds like jealousy to me.
If Virgin want to bitch about it let them spend their own millions developing great products and not try and cut into Apples pie.
On the other hand, iTMS existence is merely to sell more iPods and provide a better experience to its customers. Technically it wouldnt seem like too much of a deal letting others transfer their songs to the iPod but again why bother?
3. anonymous
To Ronan & Dan,
Can you please get off your Apple "high horse" please. If you understood DRM you would know that allowing other players to use the FairPlay system, gives you the end user a choice as to what player you use to access your content, as opposed to forcing you to use iTunes.
The rules applied to DRM are set in the licence, not in the player. Therefore if Apple released their interface to "trusted" players, the rules would be correctly applied and would not result in "unlocking" files to be "given away".
Everyone was happy to throw the book at Microsoft when they locked users in to using Internet Explorer, but seem happy when it's the other way round...
4. anonymous
To Anonymous, People complain they are locked into MS products because MS products are generally inferior to others around.
Apple has locked me into iPod and iTMS - do I complain? No, because it's the best (and cheapest) music store and player around. There is a big difference!
MS complained when AOL locked them out of AIM - because they wanted to take competitive advantage over AOL - AOL cleverly didn't let them. MS complained. AOL is still the biggest in IM.
It's called business, and apparently, Apple are getting good at it! Let's hope though that they allow other music stores in to iPod, that way, iPods will increase in sales and generate some more profit for Apple!!
5. anonymous
Two points about this 'argument'.
Firstly, I wouldn't be happy buying a hi-fi that would only play CDs bought from one store - seems overly restrictive to me.
Secondly, what about iPod owners in countries where iTunes doesn't trade? Places like the UK, until recently? How do they please RIAA and others and use DRM protected music on their iPods?
6. anonymous
Good on you Ronan, You tell tham