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Clearing Up 5 Things About the Apple iPod Antitrust Lawsuit

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By Mark Wilson, Esq. on December 17, 2014 9:44 AM

Yesterday, a federal jury found that Apple's iTunes 7 updates, made between 2006 and 2009, weren't anticompetitive . The verdict caps 10 years of litigation alleging Apple locked other music providers out of its iPods.

There's been quite a bit of misreporting what's actually going on in this case, so we decided to clarify some of the facts and issues at play.

1. DRM Was the Music Companies' Idea, Not Apple's.

Content providers love DRM. They're terrified that, because digital files can be replicated perfectly, once a user downloads a purchased file, he'll share it with all of his friends. Apple's FairPlay DRM locked a music file downloaded from the iTunes Music Store to a user's Apple ID. Only five computers, and an unlimited number of iDevices, could play content connected with that Apple ID. All of this was a concession to music labels to prevent sharing of files. If Apple couldn't ensure that FairPlay was secure, the music companies would have pulled their content from the iTunes Store.

2. It's Proprietary v. Proprietary.

Plaintiffs claimed they couldn't play songs they purchased from RealNetworks, an Apple/iTunes competitor. Really, though, they never should have been able to. RealNetworks created a program called "Harmony" that it advertised would allow you to play your Real-purchased music on iPods. In reality, Real had reverse-engineered FairPlay and then tricked iTunes into thinking Real audio files were Apple audio files (why didn't RealPlayer just turn them into MP3s?). Apple updated iTunes to prevent that from happening.

3. It's Not Really About Monopolies.

If it were, Apple would have done what other MP3 manufacturers at the time commonly did and prevented any non-Apple files from playing on them. iPods always could play regular old, non-DRM MP3 files. If Apple wanted to "lock in" its customers, a better way would be to prevent iPods from playing anything not purchased through the iTunes Store.

4. No One Was Ever Actually Harmed.

The plaintiffs in this case were (eventually) people who purchased iPods between 2006 and 2009 and who had to erase and restore their iPods after they put non-MP3 or non-Apple-purchased music on them. Of course, they never actually lost any music. Anything they bought from Real was still in their RealPlayer library. All they lost was the ability to listen to Real-purchased songs on their iPods.

5. It's a Moot Point Now.

In 2009, the iTunes Music Store went DRM-free. (Movies and TV shows are still copy-protected.) Why did Apple go DRM-free? Probably not for deep philosophical reasons. The music labels conceded DRM in exchange for variable pricing. (Prior to 2009, all the songs on iTunes cost the same -- which irked the Big Four.)

It's even more moot because downloading MP3s is even becoming anachronistic. Instead, The Kids These Days are streaming over services like Pandora and Spotify.

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