Apple Trying To Kill Off Spotify's Free Tier; DOJ Now Investigating For Antitrust
from the tempting-the-anti-trust-gods dept
Remember a few years ago when Apple got in trouble for conspiring with book publishers to raise ebook prices to hurt Amazon and the public? Apparently the company hasn't learned very much. Today comes a report from the Verge, claiming that the DOJ is now investigating Apple for conspiring with the major record labels to get them to kill off Spotify's free tier, in an effort to better promote its own Beats Music service, which has no free tier.Apple has been using its considerable power in the music industry to stop the music labels from renewing Spotify’s license to stream music through its free tier. Spotify currently has 60 million listeners, but only 15 million of them are paid users. Getting the music labels to kill the freemium tiers from Spotify and others could put Apple in prime position to grab a large swath of new users when it launches its own streaming service, which is widely expected to feature a considerable amount of exclusive content. "All the way up to Tim Cook, these guys are cutthroat," one music industry source said.And it's not just Spotify. Apparently, Apple was trying to get labels to pull music from YouTube too:
Sources also indicated that Apple offered to pay YouTube’s music licensing fee to Universal Music Group if the label stopped allowing its songs on YouTube. Apple is seemingly trying to clear a path before its streaming service launches, which is expected to debut at WWDC in June. If Apple convinces the labels to stop licensing freemium services from Spotify and YouTube, it could take out a significant portion of business from its two largest music competitors.This is fascinating for a few reasons, even beyond Apple's antitrust troubles over ebooks. In fact, there's some history here as well. A few years ago, there was an investigation, after Apple tried to pressure the labels into killing off daily deals that they were offering to Amazon, as it harmed Apple's iTunes business.
And, of course, there's the long history of the labels' relationship with Apple for much of the first decade of the millennium. Almost exactly a decade ago, we wrote about how the music labels all resented Apple because it had become such a dominant force in music with iTunes and the iPod (this was pre-iPhone) and had (for a while, at least) blocked the labels from trying to raise the price of single tracks beyond the original $0.99 price point. Of course, it's quite a sign of how the online music industry has shifted from downloads to streaming that those labels are apparently now working with Apple to focus on trying to stop competitors like Spotify and YouTube.
Just a month or so ago, we noted that there had been a series of articles claiming that the labels themselves were conspiring to put an end to free tiers on Spotify and other services, and we pointed out how stupid this was (mainly in the context of Jay-Z's new "Tidal" service). Bringing Apple into the game as well just makes the whole thing that much more ridiculous.
Rather than trying to build a better experience for users and give them more value, it appears that the labels and Apples are looking to decrease the value of competitors through coordinated action. It really says something -- and not something good -- when a company thinks the only way to compete in the market place is to kneecap competitors rather than build a better service itself. Competition has shown that great services can be built when they actually do focus on what consumers want. And there's still a long way to go. Spotify still has significant problems, but it's pretty good right now. It's astounding that Apple and the labels think that the right solution is not to build an even better product, but rather to make everyone else's products worse. Once again, it makes you wonder if they actually want to drive consumers back to completely unauthorized services.
And here's the thing that's really bizarre: why should Apple care about this at all? Apple is a hardware business. Even when iTunes was dominant, people at Apple would quietly admit that it was considered a "loss leader" or maybe a "breakeven leader" with the focus on selling more hardware. The same should be true of a streaming music service. Beats can make iPhones even more valuable -- and one way to do that is by offering a free streaming tier. Why Apple wants to take away its own value seems like a strategic error all around -- not just for consumers and competitors, but for itself as well.
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Filed Under: antitrust, competition, doj, free tier, music, music streaming, value
Companies: apple, riaa, spotify, youtube
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SOP for Apple
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Re: SOP for Apple
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Re: Re: SOP for Apple
Generally speaking, back before Bill Gates left Microsoft and Steve Jobs came back to Apple.
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Re: Re: Re: SOP for Apple
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Re: SOP for Apple
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Re: SOP for Apple
They've always been a nasty company to their customers.
They started the product upgrade staircase. If you want to run the latest software, you had to buy the latest hardware. And hardware was really expensive compared to the alternative, even back in the Apple IIe/IIc era. If you want to know why you have to upgrade to the latest iPhone to run the latest software every year, you need only look back to the Apple IIe/IIc/IIgs/Mac/Mac Pro/Mac II days. My Mac Mini G4 was supported for a whopping 9 months before they discontinued the PowerPC line and switched to Intel (it now runs powerpc Debian.) After that point, I couldn't update the OS.
They offer business customers a lease program for their hardware, which refreshes every few years, but users don't get that. Don't get me wrong, I love Apple Hardware, but I tend to install something a little more open on the hardware whenever I can (I can still run Mac OS X in a virtual machine if I need targets,) but the company has always been about the mighty dollar over customer's wants and needs.
Apple's greatest trick was convincing people they needed to spend far more than necessary on hardware available from their competitors for far cheaper, and I believe that they've gotten lazy in their later years of just outlawing or destroying their competitors instead of putting all the work into getting their customers to shell out more money to replace their existing models with newer ones.
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Re: Re: SOP for Apple
I'm not a iPhone person, but isn't the latest OS available to devices that are several years old? I know for certain they offer OS upgrades for free to older devices (just don't know exactly how old). They don't put out a new OS and tell everyone they have to buy a new phone to get it.
Feels a little weird to defend Apple...
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Re: Re: Re: SOP for Apple
Don't think of it as defending Apple. Think of it as defending the truth. Even bad people (and companies) can have truth on their side occasionally. :)
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Re: Re: Re: Re: SOP for Apple
Yeah that's the weird part. :-)
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Re: Re: Re: SOP for Apple
The iPhone 4 can only run ios 7.1.2. Here is the list of maximum OS versions for phones:
http://en.wikipedia.org/wiki/List_of_iOS_devices
If you have a iPhone 4s or later, you can run the latest operating system. Now the iPhone 4 is 5 years old, so yes, maybe most folks have already bought a new phone, but my Samsung Galaxy S2 runs Cyanogenmod 11.0 (albiet a little slowly) without complaint. I know of a few people out there that still have iPhone 4s that can't upgrade.
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Re: Re: Re: Re: SOP for Apple
Ah, I meant iPhone 4. Not iPhone 4s, hard to write the plural of iPhone 4 without using an "s" and confusing it with the 4s.
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I guess it depends on who purchased the phone. I guess for those of us that purchase their own phone for $500-1000, we want it to last for a while (at least 5 years.) But if you had your phone subsidized, replacing it every two years is no big deal. Speaking of which, probably should start looking for a new phone since my phone is that old.
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Re: Re: Re: Re: Re: Re: SOP for Apple
How long the phone lasts is a separate question from whether new software will run on it. I would think one problem with the longevity of an iPhone would be the difficulty of replacing the battery. Some newer Android phones have the same issue.
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I absolutely agree. But my original gripe was on how quickly Apple tends to EOL the devices. Maybe the iPhone was a bad example, though as I stated, I know people with a working iPhone 4 that complain, quite loudly, about not being able to run the latest version of ios. And I do have personal experience with them EOL'ing my Mac Mini I purchased in 2005 for ~$700 in Feb of 2006.
I tend to be more of a fanboy of Apple than the alternative, especially when it comes to my 2011 MacBook Pro, but that device isn't in a walled garden though, and runs Debian Linux perfectly fine. But I am tired of spending good money on a device with a life expectancy of less than 5 years (which is also why I avoid ASUS Transformers like the plague, since with their encrypted bootsector and every single one I've owned dying within 2 years of buying it, I cannot justify the expense.)
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That is pretty bad.
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My response would be - why? Apart from the cosmetic look, most of the new features are specifically designed to take advantage of the hardware in newer phones that isn't present in the 4. Performance-wise, it would run like a dog even with those turned off - which is a primary reason why Apple doesn't support it.
Are they missing something they actually want/need that is possible on an iPhone 4, or are they just wanting the new shiny thing without wanting to pay for it? I can see maybe not being able to get certain app upgrades, but even then that might just be a developer wanting to use something not possible on the 4.
"And I do have personal experience with them EOL'ing my Mac Mini I purchased in 2005 for ~$700 in Feb of 2006. "
Weird, my mid-2010 model Mac Mini was perfectly compatible with Yosemite, which I downloaded from Apple on launch day with no issues. It just doesn't have a few of the extra features like Handoff and AirDrop.
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Re: Re: Re: Re: Re: Re: Re: Re: Re: SOP for Apple
Weird, my mid-2010 model Mac Mini was perfectly compatible with Yosemite, which I downloaded from Apple on launch day with no issues. It just doesn't have a few of the extra features like Handoff and AirDrop.
As stated above, Apple switched from PowerPC in their 2005 model of Mac Mini to Intel in February 2006. In 2005, the OS was MacOSX 10.4. Apple decided to discontinue PowerPC in 10.5. You could buy a copy of Leopard and install it over Tiger, but that was it. Someone figured out how to install 10.6 on top of PowerPC, but it wasn't officially sanctioned.
Any version of Intel MacMini should run Yosimite.
I couldn't see buying an Intel version of MacMini after they got me to sump the money on a PowerPC version and then EOL'd it 9 months after selling it.
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But, I'd still say it's a rather unique case, as it's highly unusual for such a massive fundamental architecture change to take place. But, yeah, I wouldn't have been buying another.
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Don't get me wrong...Apple makes great hardware (expensive, but great,) and I have no problem buying Apples, so long as you go in with the realization that the computer you just spent a lot of money on will likely not be supported in the future (the distance to that point in the future is variable, and depends on the whims of the company, not you.)
And their stuff runs Debian quite well (and actually, my PowerPC MacMini runs faster with Debian than it ran with MacOSX, which I use as a Kiosk machine.) The added advantage of running Debian on a Mac is that you can run MacOS X virtual machines (legally) without much difficulty, though hackintoshes make it pretty simple too (though less legally.)
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Not if there is a critical security flaw, and no patch is available.
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Depends on the definition of "lasts" but yes that is certainly an issue.
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-- Adam Smith, The Wealth of Nations
-- John D. Rockefeller
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Re:
"10. Greed is eternal."
"45. Expand, or die."
"97. Enough ... is never enough."
"189. Let others keep their reputation. You keep their money."
242. More is good ... all is better.
-- Ferengi Rules of Acquisition
or as Quark so eloquently put it: "Every Ferengi business transaction is governed by 285 rules of acquisition to ensure a fair and honest deal for all parties concerned... well most of them anyway."
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Seems Apple doesn't want to compete with free.
Umm, true up to a point, but Apple is mostly selling the sizzle and not the steak. I've long wondered how it sells crappy hardware at exorbitant prices with authoritarian policies. Proves modern markets aren't rational.
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Re: Seems Apple doesn't want to compete with free.
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Re: Re: Seems Apple doesn't want to compete with free.
You mean iDiots, don't you? (I've always wondered why that term has never caught on...)
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Re: Seems Apple doesn't want to compete with free.
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Re: Re: Re: Seems Apple doesn't want to compete with free.
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Re: Re: Re: Re: Seems Apple doesn't want to compete with free.
Value = quality (fitness for use) divided by Cost.
In my book, the qualities of products from less artificially restricted products offer better value.
I understand they might be great for you, but in the others guys assessment, he says crap, and he is right. and you are right too. but not for each other.
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Re: Re: Re: Re: Re: Seems Apple doesn't want to compete with free.
Every iPhone comes with no real keyboard, only an on-screen keyboard.
If you hold the phone vertically, ("portrait" orientation,) the "keys" are tiny and accuracy suffers horribly.
If you hold the phone horizontally, ("landscape" orientation), the keys are decent-sized, but the keyboard blocks a significant amount of the screen space, so it's very hard to see what you're working on.
Either way, it violates Einstein's maxim: make everything as simple as possible, but not simpler.
Value = fitness for use / cost. 0 divided by anything = 0. Only an iDiot would buy an iPhone.
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Re: Re: Re: Re: Re: Re: Seems Apple doesn't want to compete with free.
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Re: Re: Re: Re: Re: Re: Re: Re: Seems Apple doesn't want to compete with free.
Look, I understand you have a preference, but can we keep the fanboy wankfest away from these conversations, or at least stick to criticisms that don't apply to all available platforms? If the iPhone lacks features you prefer to have, don't buy one. If you prefer Android, buy one of those. Everyone else makes similar decisions based on their own preferences. End of story.
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Re: Re: Re: Re: Re: Seems Apple doesn't want to compete with free.
The way you describe your problems with Apple, you are discussing their SOFTWARE and its walled gardens, whose potentially poor value does not impact the quality of the hardware.
Also, what you wanted to say was "In my book, the qualities of products from less artificially restricted products is better". The way you stated it, quality would universally increase value, no matter the cost, which isn't the case by your value formula.
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Re: Re: Re: Re: Re: Re: Seems Apple doesn't want to compete with free.
As an example, I have never considered Apple products to be of unusually high quality. Their quality level is fine, but I can easily find equivalent non-Apple products that are of better or worse quality.
When I've asked Apple fans to say what makes Apple products high quality, their responses are almost always about aesthetics -- which is a totally valid benchmark! However, for me personally, aesthetics don't enter into the "quality equation" unless they are truly abysmal or we're talking about something intended to be ornamental. And I'm right, too!
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Re: Re: Re: Re: Re: Re: Seems Apple doesn't want to compete with free.
Free is difficult to deal with. that is infinite value.
But generally it is on the margins of options. the increments. Each option delivers a ratio of desired features per cost and your best bet is the one with the highest value.
You decide the features and can even weight them. Score each option and call that its feature score and divide by cost.
Im not making this up. This is the definition of value in a business type environment.
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Re: Re: Re: Re: Re: Re: Re: Seems Apple doesn't want to compete with free.
Not automatically. I can easily come up with a list of things that I can get for free, but present a negative value to me (so I don't take them).
"This is the definition of value in a business type environment."
That's not irrational. It's your basic cost/benefit calculation. It's pretty much how we determine value for anything -- even things that aren't products and that we aren't purchasing.
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Re: Re: Re: Re: Re: Re: Re: Re: Seems Apple doesn't want to compete with free.
Both paradigms have good and bad points, but clueless idiots should be kept away from the inner workings of either. When I used to support the public many moons ago, I've seen PCs that have lasted a decade and Macs that have lasted 6 months, but it will always be the guy who bought a cheap-ass PC and assumed that he knew what he was doing who would cause the most damage (and whine the hardest about how he wasn't responsible).
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Re: Re: Re: Re: Re: Re: Re: Seems Apple doesn't want to compete with free.
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Re: Re: Re: Re: Seems Apple doesn't want to compete with free.
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Re: Re: Re: Re: Re: Seems Apple doesn't want to compete with free.
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Re: Re: Re: Seems Apple doesn't want to compete with free.
According to Consumer Reports, Apple computers have the lowest repair rates.
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Re: Re: Seems Apple doesn't want to compete with free.
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It's a Walled Garden, not a Prison Camp.
The content is Curated, not Censored.
The rules to get content and apps approved are not arbitrary and capricious; they are secret. Apple doesn't want to publish rules that merely make reference to bad things which you should not be exposed to.
It's not that Apple telling you what you may and may not think; they are protecting you from being exposed to bad ideas, for your own good.
With Music, Apple now wants to help guide you to listen to what music it knows you will agree to like and pay Apple for telling you to like it.
You know the quality must be good because of the high prices.
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In a well lit office in a building far, far away...
Apple: These are not the anti-trust violations you are looking for. *waving stack of hundreds*
DoJ: These aren't the anti-trust violations we're looking for.
Apple: You should investigate Spotify for anti-trust violations, then drop the case once they've taken a PR beating because of it.
DoJ: We will investigate Spotify for anti-trust violations, and then drop the case later.
Apple: Move along.
DoJ: Move along.
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That wasn't the issue. The issue was that Apple was conspiring with publishers to set a minimum price the publishers would require regardless of where they sold their e-books. It was classic, old-school price-fixing.
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Re: Re:
I was really basing my commentary on Techdirt's discussion of the verdict (which was similar to others I read at the time, which highlighted this gem from the decision:The impression I got from that is that Apple was convicted of price fixing because Apple refused to try to compete in a market where the dominant player sold its products at a loss. And so, given the model is that Apple doesn't set pricing, I was confused as to how Apple was setting prices.
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And conversely, getting rid of the publishers doesn't solve Amazon's policy of selling e-books at a loss. And once you get rid of all middle men, you have no distribution network to reach your fans.
So really, Im just having a hard time figuring out your point in that sarcastic post.
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Google is your friend....
Google is your friend:
http://www.macworld.com/article/2044007/judge-rules-apple-colluded-with-publishers-to-fix-ebo ok-prices.html
http://www.reuters.com/article/2013/07/10/us-apple-ebooks-idUSBRE9690GE20130710
http:// www.theguardian.com/technology/2012/apr/11/apple-accused-fixing-prices-ebooks
http://www.pcworld.com/ article/2044009/apple-colluded-with-book-publishers-on-ebook-prices-judge-rules.html
https://fortune. com/2013/07/10/apple-found-guilty-of-colluding-to-raise-e-book-prices/
http://www.cnet.com/news/doj-a pple-colluded-with-publishers-to-raise-e-book-prices/
http://www.pbs.org/mediashift/2011/10/did-apple -collude-with-publishers-to-fix-prices-on-e-books276/
http://www.hollywoodreporter.com/thr-esq/apple- loses-governments-antitrust-lawsuit-583093
From TechDirt.com:
https://www.techdirt.com/articles/20120411/07155418453/breaking-us-sues-apple-publisher s-over-ebook-price-fixing.shtml
https://www.techdirt.com/articles/20120309/03540318044/us-government- finally-realizes-that-publishers-apple-conspiring-to-raise-ebook-prices-is-price-fixing.shtml
https:/ /www.techdirt.com/articles/20120830/13190220221/first-round-ebook-price-fixing-settlements-are-annou nced.shtml
And the paperwork from the court itself:
http://www.nysd.uscourts.gov/cases/show.php?db=special&id=306
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Re: Google is your friend....
Why should you be surprised? Willful blindness and intentional ignorance rules the day with shills posting here.
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Re: Re: Re:
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Then you weren't paying attention
As far as eBooks:
What Apple did was:
1. Refuse to sell at less than a 30% mark up (note, we aren't even close to a loss).
2. Ensure that _no_one_ else could sell eBooks for any price _below_ what Apple was charging.
3. Collude with publishers to force other sellers (especially the current market leader Amazon) to switch from a wholesale/retail model to an agent model to enforce #2.
#1 was Apple's choice, #2 harmed consumers, #3 was illegal under anti-trust laws.
In the end Apple didn't have to compete on price. The publishers got more money, and everyone else ended up paying more than they would have (and previously were) in the face of honest competition.
The RealMedia case was two fold.
First, preventing RealMedia files from running on iPods (the current market leader) ensured that you would have to go to the Apple store (and pay Apple prices) to get music for your shiny new iPod. IF people could go to other stores for music, then Apple's position would be significantly weakened.
Second, preventing iTunes music files from playing on any music player other then iPods (iTunes on the desktop doesn't count as it's not a portable player) means it is less likely that people would purchase an iPod competitor. Imagine you have a hundred songs in an Apple music format. Would you buy anything other than another iPod if doing so meant you couldn't play the music files you had already bought?
Once again, Apple was using 'dirty tricks' to kneecap the competition.
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Re: Then you weren't paying attention
And that very well could have been the problem with the coverage of the iPod case. But everywhere I looked, I got the same complaint, that by cutting out RealMedia files from the iPod (the anti-Harmony measures), Apple was able to charge more for the iPod. In other words the iPod's DRM increased the value of the iPod. I could see arguments that the iTunes DRM increased the value of the iPod (and given that the content creators wanted it, it can't be completely blamed on Apple), or that the iPod DRM increased the value of iTunes, but not that the iPod DRM increased the value of the iPod.
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Re: Then you weren't paying attention
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Apple's past sins
Their bad attitude suddenly stopped when they came to an agreement regarding their position on the Apple music list, making Apple becoming quite rich in the process. They had never signed a subsequent contract with any music company since they left Capitol Records, I do believe.
The only reason Apple didn't steal the music was that they knew they had the upper hand in distribution and they could make the deal.
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Lots of reasons.....
Here's a thought (complete speculation of course):
Apple _kneecaps_ all of the other streaming music services.
The majority of people have to go to Apple to get legal streaming services.
Apple can:
-make streaming services work 'better' on Apple hardware than anyone elses.
-charge whatever they want.
-access a 'fee' from musicians/labels to host their music in the Apple store (app store fees all over again).
-leverage all those music fan eyeballs to push other things.
-sell ads and collect all the money.
Just as in the eBook case, Apple and the labels (substituted for publishers) make more money, and the consumer is charged a higher price for a potentially inferior product. Cabals being so much more profitable than actually competing.
Of course, ironically, the puts Apple back in the same position they were in regarding downloads, with Apple in control and the labels dependent on Apple.
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dirt on technology
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Re: dirt on technology
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Re: dirt on technology
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Re: dirt on technology
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Re: dirt on technology
The answer to your question is "yes."
This site is, and always has been (at least as long as I've been coming here - 13 years) about tech and the political, legal, and sociological issues surrounding tech. Copyright and patent talk has been a part of the articles and discussion at this site for a very long time.
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It seems to me that the goverment doesn't have enough teeth or is incapable (I'll refrain from going so far as "unwilling") of using them, and that copyright-inundated private organizations are incapable of or unwilling to operate in a manner that doesn't destroy what is in the public's interest.
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Also, you're off topic.
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No one claimed platforms violate copyright laws, and the comment was on topic.
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Platforms which allow users to do things without caring whether or not those users are playing within the ever-shrinking realm of "acceptable according to the big copyright conglomerates" are probably some of the most powerful forces acting in the public interest. What do movie and music studios do? What do typical software development behemonths do?
You have taken a sensible, topical comment and made it out to be something it was never intended to be by commenting with a kneejerk conspiracy/troll theory before thinking. Gratz.
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Yes, like public libraries.
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Any platform that attempts to enforce copyright law through technological means is a broken platform (even if you never use it to violate copyright law).
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Well this move is already driving piracy
This helped piracy how exactly? Now they're going from some money via my legal streaming to zero money with my stream ripping. Brilliant move guys!
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What this whole thing will do should it be successful on Apple's part will just revamp the piracy angle which is what Spotify has managed to put a dent in. Of course this is about the bottom line, not about the issue of piracy. They are not going to get money, nor eyeballs for ads, that way.
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One day, I wanted to plug my iPod into my work computer to listen to some tunes through my powered speakers. iTunes, which I had installed on my work computer expressly for this purpose, told me I'd need to wipe my iPod if I wanted to pair it with my work computer. According to Apple, I didn't own the music I'd bought through iTunes, not even the music I'd ripped from my own CDs and put on my iPod, as I couldn't use it as I wished.
That night I downloaded dopisp, closed and uninstalled iTunes, and never looked back. I lived happily ever after.
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Apparently the company hasn't learned very much.
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Re: Apparently the company hasn't learned very much.
'Aren't very serious' indeed...
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Competition
Well when you have Apple's clout, that is the easier way to do it.
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Consumer Reports agrees*, and they're not known as a humor publication.
* at least as far as computers go - not sure about mobile devices
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If your main criteria for your car is horsepower, that doesn't mean that the guy who bought a small car with a high MPG but low horsepower wrong. It just means he values mileage over power. If you wouldn't buy that car, don't.
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