Free-DRM music by iTunes, but EC starts official investigation
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EMI and Apple announced in the beginning of April 2007 that EMI Music's entire digital catalogue of music will be available for purchase without DRM from the iTunes worldwide in May. This is also the result of several complaints from consumer advocates and European Commission (EC) officials on iTunes practices.However, this decision hasn't stop the EC to send Apple and other four record labels a Statement of Objections, considering that their business practices might be restrictive in terms of the EU treaty.
The agreement between EMI and iTunes was presented on 2 April 2007 by EMI's CEO Eric Nicoli and Apple's CEO Steve Jobs. Apple announced that the higher quality versions of songs without DRM will be sold for 1.29 USD rather than 0.99 USD. iTunes will also offer the possibility to upgrade the previously purchased EMI content to the DRM-free format for 0.30 USD/song. At the same time the EMI music videos will also be available in DRM-free format with no change in price.
The news was welcomed by several consumer organizations that have criticized the iTunes system for a long time, such as the Federation of German Consumer Organizations (vzbv). "An important step has been made towards meeting our demands. Now other music companies need to follow suit," the deputy head of the vzbv Patrick von Braunmühl.
EDRI-member Ian Brown points out that the pressure by the EC, Norwegian, French and German consumer ombudsmen and digital rights activists "has made it extremely difficult for Apple to justify its continued lock-in of iTunes customers."
Just one week before the announcement, the consumer protection organizations from Germany, France, Norway and Finland had a common meeting with a delegation of the International Federation of the Phonographic Industry (IFPI) on interoperability and DRM issues. The discussions that were held in Oslo, took place at the request of the IFPI. The consumer NGOs sent an ultimatum to iTunes on selling DRM-free music. This seems to have an effect.
Despite the announcement from EMI and Apple, the European Commission sent to Apple and other four record companies statement of objections, which is the first formal step in an European antitrust investigation. The companies have two months to defend themselves in writing. The EC actions were based not on the DRM debate, but on the different prices the company has pushed in Europe. This follows a complaint by Which? about the fact that UK users of iTunes paid for songs about 1.16 Euro, compared with 0.99 Euro/song, which is the price in other EU member states.
The Commission explained that the main problem is that "consumers can only buy music from the iTunes' on-line store in their country of residence. Consumers are thus restricted in their choice of where to buy music, and consequently what music is available, and at what price. The Commission alleges in the Statement of Objections that these agreements violate the EC Treaty's rules prohibiting restrictive business practices (Article 81)."
Apple strikes deal with EMI but European regulators are not pacified
Apple Unveils Higher Quality DRM-Free Music on the iTunes Store (2.04.2007)
EC goes Apple hunting - reports (3.04.2007)
Consumer advocates welcome DRM-free music (3.04.2007)
EDRI-gram: iTunes under continuous attack in Europe (31.01.2007)
EDRI-gram : Is DRM fading out ? (17.01.2007)