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


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.