Free-DRM music by iTunes, but EC starts official investigation

(Dieser Artikel ist auch in deutscher Sprache verfügbar)

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
(3.04.2007)
http://www.out-law.com//default.aspx?page=7933

Apple Unveils Higher Quality DRM-Free Music on the iTunes Store (2.04.2007)
http://www.apple.com/pr/library/2007/04/02itunes.html

EC goes Apple hunting – reports (3.04.2007)
http://www.theregister.co.uk/2007/04/03/apple_ec_labels/

Consumer advocates welcome DRM-free music (3.04.2007)
http://www.heise.de/english/newsticker/news/87820/from/rss09

EDRI-gram: iTunes under continuous attack in Europe (31.01.2007)
http://www.edri.org/edrigram/number5.2/itunes

EDRI-gram : Is DRM fading out ? (17.01.2007)
http://www.edri.org/edrigram/number5.1/drm