The Beatles and Denmark Bob For Apple Bites

Michael Hedges - March 30, 2006

Big, successful ideas should make everybody happy, right? Of course, not! They only become targets of universal ire.
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Certainly Bill Gates is taking a small measure of comfort this week at not being the target of another country’s acrimony. For more than a decade Microsoft has found itself at odds with one body or another over one thing or another. The software company today faces a €2 million daily fine from the European Commission for delays in complying with an EC anti-trust judgment. Success is truly a magnet.

The Beatles – in the form of Apple Corps, the company holding rights to the vast Beatles music catalogue – have never been entirely happy with Apple. Four years after the US computer company was founded, named for Steve Jobs' love for the Beatles music, Apple corps sued. That was 25 years ago. Apple, recharged by iPod and iTunes success, finds itself once again the in London dock this week for allegedly violating terms of the 1991 agreement about who can sell what to whom. The fight, in basic terms, is over that logo: the Apple with the bite taken out. 

Two big Danish companies that operate online music stores – TDC and Maersk – are solidly behind the French government draft law that would require interoperability among devices and download services. Sufficient pressure, reported Ars Technica (Monday, March 27), enlisted Danish Culture Minister Brian Mikkelsen to promise legislation in 2007 to force open Apple’s digital rights management (DRM) system, FairPlay.

Apple trotted out JP Morgan analyst Bill Shope to support its position that there would likely be no EU-wide rule undertaking to disable current DRM rules “If the French law passes, we believe the online music providers will either choose to exit France, or they will end up with very limited content offerings in the region,” he wrote in a report released Tuesday March 28) and quoted by Appleinsider. So far, only Microsoft has been in the sights of EU Competition Commissioner Neelie Kroes.

“Perversion” is how Apple Corps lawyer Geoffery Vos described Apple’s (the iPod company) interpretation of the 1991 agreement with Apple Corps (the Beatles music rights holder) in which Apple (the iPod company) paid a lot of money and said they would not become a record label and sell plastic ware. The courts, both sides agreed, would decide.

An astute European who had lived several years in the United States pointed out the difference between Europeans and Americans. “If,” he said, “an American is standing on a street corner and somebody drives by in a Ferrari, the American thinks to himself ‘How can I get one of those?’ On the other hand, a European standing on that street corner says ‘How can I get that guy out of that car?’”

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EU Commissioners’ “Gut Instinct” – Bad Apple - March 12, 2007

Consumer Protection Commissioner Meglena Kuneva took a shot at Apple iPod and iTunes in an interview with the German magazine Focus, previewed prior to publication (Monday, March 12).

She said: "Do you think it's fine that a CD plays in all CD players but that an iTunes song only plays in an iPod? I don't. Something has to change."

Almost immediately, a Commission spokesperson back-tracked: "I don't think she was stating it as a definitive policy position. At this stage it is her gut instinct."

Any politicans’ candid comment, dutifully reported, serves a purpose. Post-modernists among us would call it “playing to the narrative.” And one popular narrative is “Apple Bad.” Microsoft was bad once, until every person in France, Germany and Norway under 25 years pined away for an iPod.

Finland, too, has called for Apple’s punishment. If Nokia had put the same product on the market…Well, let’s not go there.

On the surface the iPod/iTunes complaint is about the proprietary digital rights management (DRM) system that (a) prevents moving copyrighted material from iTunes to a different personal digital audio player and (b) allows an agreed rights fee payment system that does not inflate the price to the point of killing the entire product category. 

Apple boss Steve Jobs has gone on record favoring the elimination of DRM. The World Intellectual Property Organization (WIPO) just finished a treaty that would put DRM on virtually everything. Teenaged Ukrainian code hackers continue to laugh deliriously.

Mrs Kuneva is, however, correct. Something has to change.