iLounge.com has the story that I read. There is a woman named Stacie Somers and she decided that Apple is in violation of the Sherman Antitrust Act because Apple doesn't support the Microsoft WMA file format. Let's take a look at a couple of key points in the complaint here.
“Apple has engaged in tying and monopolizing behavior, placing unneeded and unjustifiable technological restrictions on its most popular products in an effort to restrict consumer choice, and to restrain what little remains of its competition in the digital music markets,”
OK, what technological restrictions has Apple placed on either the iPod or iTunes? There is only one; no protected WMA. WMA is a Microsoft proprietary file format (we'll get there in a minute) and MS would certainly want royalties for every device sold to include it in the iPod or in iTunes. Shouldn't that decision be left to Apple? Hell, MS doesn't even bother to support Plays For Sure WMA files on the Zune. Why should Apple have to?
The iPod supports the following file formats:
AAC (16 to 320 Kbps), Protected AAC (from iTunes Store), MP3 (16 to 320 Kbps), MP3 VBR, Audible (formats 2, 3, and 4), Apple Lossless, WAV, and AIFF
Further, you can import and convert non-protected WMA's in to iTunes. I don't know a single person that RIPs their CD's in to WMA format. I don't even know anyone that buys protected WMA content. WMA files do not sound nearly as good as a similar bit rate MP3 or MP4 file. Why should Apple have to support junk?
“Apple’s iPod is alone among mass-market Digital Music Players in not supporting the WMA format,”
Wait, what did that just say? Alone among mass market devices? That is EXACTLY what it said. Competition = NO MONOPOLY. I bought a new pair of ear buds at Best Buy a few days before Christmas. There was much more shelf space devoted to players other than the iPod. I didn't count them, but I would venture to say that the non-iPods easily had double the space dedicated to displaying them. The people were all crowded around the iPods. Nuff said.
On to the file format. The complaint alleges numerous times that the iPod will not play WMA files. As stated that is true to an extent, but non-protected files can be imported and played in iTunes and the iPod. But let's look at this right here:
"Apple, however, deliberately designed the iPod's software so that it would only play a single protected digital format, Apple's FairPlay-modified AAC format," the complaint states. "Deliberately disabling a desirable feature of a computer product is known as 'crippling' a product, and software that does this is known as 'crippleware.' "
There are two companies that I know of that both produce an MP3 player AND operate their own music store; Apple and Microsoft. Both the iPod and the Zune support only one protected file format. The iPod supports protected AAC and the Zune supports Windows Media DRM. This IS NOT Plays For Sure DRM. The Microsoft Zune itself DOES NOT SUPPORT Plays For Sure. Why should Apple have to support what isn't even good enough for Microsoft?
The real kicker in that quote for me is the word "desirable". Who in the hell desires to have Plays For Sure in their iPod? Do a survey of current iPod owners. I'm sure there are some that would want it, but if the number were to go above just a few percentage points I would eat a bug.
Napster (use it with my XM Inno) software defaults to MP3 for CD import. WinAmp defaults to MP3 for CD import. Slacker Desktop Player defaults to MP3 for CD import. Who EXACTLY DESIRES to have WMA support in ANY device? Napster does only because they need DRM to sell music.
The last bit that I am going to look at here:
Apple's pricing is "monopolistic, excessive, and arbitrary," citing how a wholesale $5.52 price difference between 1-Gbyte ($4.15) and 4-Gbyte ($9.67) NAND flash memory modules results in a $100 retail price difference between 1-Gbyte iPod Nano and a 4-Gbyte Nano.
So there is a price difference of $100 in Nano models? Really? Let's gloss over the fact that there isn't a 1GB Nano shall we? Since when did the cost of materials that go in to a luxury consumer product have any legal effect on what a company can charge for it? Price is determined by the consumer. Apple floats a product at a certain price and people will buy it there or they won't. Remember the $200 price drop on the iPhone two months after introduction?
But let's look at pricing for minute to cover the obvious mistake in the complaint. Here is the price chart for the iPod models:
| iPod Shuffle 1GB | $79 |
| iPod Nano 4Gb | $149 |
| iPod Nano 8GB | $199 |
| iPod Classic 80GB | $249 |
| iPod Classic 160GB | $349 |
| iPod Touch 8GB | $299 |
| iPod Touch 16GB | $399 |
| Zune 4GB | $149 |
| Zune 8GB | $199 |
| Zune 30GB | $199 |
| Zune 80GB | $249 |
Notice the similarities? Yet Apple prices are "excessive and arbitrary".
So there are two points where there is a $100 price difference and that is for the hard drive based iPods and the Touch. If Microsoft charges the EXACT same prices for the same size player how are Apple prices "excessive and arbitrary"? Seems like it is the going rate to me if other companies are able to move product at the same price.
I disagree with the notion that Apple has a monopoly on anything. The fact there is competition would support my position, but let's assume that they do have a monopoly on MP3 players, online music sales and desktop media managers. That fact alone would not be illegal.
Apple has never reacted in any way to any competitor in an attempt to damage a competitors business. With the exception of adding videos the iPod, iTunes and iTunes Music Store are the same today that they were on day one. There have been some natural progressions. Podcasts (another Apple creation) have been added as have other things like store features, but there have been no steps taken by Apple to harm a competitor. Apple let's them come and watches them fail of their own accord.
Look to a company like Microsoft to see what abuse of monopoly power looks like. Even Microsoft won't support Plays For Sure on the Zune. How is that not abuse?
