Apple Faces Trial For Allegedly “Locking” iPod Owners into iTunes Ecosystem

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A federal judge has ruled that Apple will have to face a trial over accusations that they used digital rights management (DRM) to maintain a lead in the digital music market.

US District Judge Yvonne Gonzales Rogers recently denied Apple’s motion for a summary judgement in a long running case, which moves the lawsuit to the trial phase. The ruling handed down last week is the latest development in a case that dates back to 2004, reports ArsTechnica.

The claims in the case harken back to a time when iPods and the iTunes music store were fast becoming the center of Apple’s business. In 2004, Real Networks launched a new version of RealPlayer that competed with iTunes. Real made songs from its own digital music store mimic Apple’s FairPlay system so that music bought from Real could play on iPods. They called the compatibility feature “Harmony.”

According to the plaintiffs, Apple created a monopoly in the digital music space by implementing FairPlay DRM protocols which essentially locked all iPod users into the iTunes ecosystem.

“They describe how Apple kept updating iTunes to make sure songs bought from Real’s competing digital music store couldn’t be used on iPods. As a result of this lock-in, Apple was able to overcharge its customers to the tune of tens of millions of dollars.”

The case involves RealNetworks’ “Harmony” technology which is a workaround for FairPlay DRM that allowed customers to purchase music from their store and place the music on their iPod.

“Apple’s lawyer claimed the plaintiffs don’t have “any evidence at all” showing harm to customers from the FairPlay DRM. The Robins Geller lawyers representing the class said they had thousands of complaints from consumers who were upset because they couldn’t play non-iTunes songs on their iPods.”

RealNetworks is seeking $350 million in damages. The company says that the monetary compensation will represent compromised customers who purchased an iPod between September 12, 2006 and March 31, 2009.

The trial is set to begin on November 17 in Oakland, California. Do you think Apple is being fairly accused of creating a monopoly through iTunes Music Store DRM? Let us know in the comments below.

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  • ABetterWorld

    I actually want Apple to lose this because they have sucking at the iTunes / my shuffle iPod interface. Used to be really good till they changed it a few years ago.

  • sukisszoze

    Apple didn’t force anyone to buy music on iTunes to play on iPods. There were options back then, lots of mp3 players.

  • DoYouSmellBurntToast

    I remember their offering. It didn’t sound as high quality as the same 192bit MP3 songs I had. That was why it didn’t take off in the market. Their product was overpriced for the lousy quality.
    Besides, I still have to this day an alternate OS on my iPod Classic called RockBox. It plays Flac and other formats including their crappy format, if you can still find it.
    The market spoke and Real Networks proprietary junk was not chosen.
    Unfortunately, neither was Flac, but that’s another discussion.

  • FragilityG4

    Weren’t songs 99 cents under DRM? As they became popular didn’t the music industry tell Steve to raise the price and he said no? Plus you could put any music bought/downloaded from anywhere as long as you encode it properly first.

  • HooDatty

    The problem with flac was file size, plain and simple. People care a whole lot less over almost inaudible changes to sound quality vs a ten fold decrease in storage capacity. Especially on a device to be used with headphones that don’t produce high fidelity sound either.