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DoJ investigating Apple for antitrust abuses in music

updated 10:00 pm EDT, Tue May 25, 2010

Apple said abusing iTunes lead to hurt Amazon

The US Department of Justice is investigating Apple for possibly using its dominance of online music to stifle Amazon, multiple sources alleged on Tuesday night. An inquiry in its "early stages" is determining whether Apple unfairly leveraged iTunes to deny exclusive music to Amazon MP3 and guarantee that any song would be available at both stores at the same time. Conversations so far are said by the NYT to have been broad and involved the nature of selling music online.

While pushing for equal or better access to songs isn't uncommon among music stores, Apple supposedly threatened music labels with taking away the usual marketing support, a potentially anti-competitive move that would have given Apple favorable treatment. The music would still have been sold on iTunes but, without promotion, would likely have sold in considerably lower numbers.

Neither the Department of Justice nor the involved companies agreed to comment.

Apple is still a minority in computers and phones but has a majority in American digital music at about 69 percent, according to NPD figures. Although it sells music in a DRM-free, broadly used format and prevents at least some degree of lock-in, its early position in per-track music sales and its sheer clout as the leading MP3 player seller make it costly for any label to either lose Apple's attention for a major release or to avoid the store altogether.

The same reports also back claims that the FTC is investigating iPhone developer rules for similar abuses at the behest of Adobe, which has felt slighted for the exclusion of Flash as a possible cross-development tool. It too is still young and may stand less of a chance of becoming a full case, as Apple doesn't have a majority position either in the US or worldwide.


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By Electronista Staff
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Comments

  1. jarod

    Fresh-Faced Recruit

    Joined: Apr 2005

    0

    LOL

    Here we go again! More wasting of tax payer money. Don't these people get it. People use iTunes because its the best at what it does. All these other wannabe iTunes are pure c*** plain and simple. THAT'S why no one uses then and THAT'S why they don't sell for jack!

    Idiots.

  1. Lifeisabeach

    Fresh-Faced Recruit

    Joined: May 2010

    +16

    Let me get this straight...

    So as I understand it, the music cartels want to give Amazon exclusive rights to some newly released songs, and expect Apple to just look the other way and continue supporting them with marketing efforts? That's like stabbing someone in the back, then asking them for cab fare. That's INSANE! It's not like Apple is demanding exclusivity for themselves.

    And don't EVEN get me started on Adobe's petty wailing.

  1. aristotles

    Grizzled Veteran

    Joined: Jul 2004

    +16

    Wait, what?

    They are investigating Apple for using their market influence to prevent anti-competitive behaviour (exclusives) as anti-trust?

  1. eyerhyme

    Fresh-Faced Recruit

    Joined: Apr 2007

    +18

    Major Labels

    And what about the 4 major labels who control 95% of music? As a musician, I'm sick of this c***. DoJ needs to wake up to the real issues affecting the music biz. Perhaps we could start by getting rid of the RIAA.

  1. revco

    Fresh-Faced Recruit

    Joined: May 2005

    0

    comment title

    Apple is making a sh*t load of money for all concerned and apparently their's an injustice in there. Somewhere.

  1. tundaman

    Fresh-Faced Recruit

    Joined: Mar 2010

    +8

    Other way around

    Is it just me or there's something really wrong with DoJ logic's? The way I see it, it would be plausible to argue about unfair practices if the opposite was true, I mean, if Apple was using his market dominance to make pressure to get exclusivity, not the other way around!

    "Threatened music labels with taking away the usual marketing support..."? What do they expect Apple to do in this scenario? Spent loads of cash to promote new material just to watch people go buy it at competitors because they manage to sell it earlier?

    Clueless people!

  1. ethical_paul

    Fresh-Faced Recruit

    Joined: Mar 2002

    +5

    I'm with you guys

    So Amazon and some record companies make some backroom deals to prevent competition and the DoJ wants to investigate Apple?

    It's just business as usual in the music biz. Those criminals wouldn't know a free market if it bit them in the a**...again.

  1. tfmeehan

    Fresh-Faced Recruit

    Joined: Mar 2009

    +3

    WTF?

    The rule must be "whoever screams first and loudest" gets the benefit of the doubt.

    I understand that Apple may have used (abused?) it's position to influence, BUT isn't it the RESULT that matters?

    How can they possibly be faulted for INCREASING ACCESS?

    I had to read that part twice because I was sure it couldn't be what I thought I read.

  1. testudo

    Forum Regular

    Joined: Aug 2001

    -1

    Re: Other way around

    "Threatened music labels with taking away the usual marketing support..."? What do they expect Apple to do in this scenario? Spent loads of cash to promote new material just to watch people go buy it at competitors because they manage to sell it earlier?


    Um, it's the threat of not marketing which is their pressure to get the content or exclusivity that is being investigated.

  1. facebook_Johnny

    Via Facebook

    Joined: May 2010

    -2

    Interesting

    What is going on with apple these days? They went from healthy competition to total annihilation. They need to step back and take a break or something, too bad they didn't invent the electronic cigarette, or they would be all over that industry.

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