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Mac Forum / General / Hardware / August 2004Apple-Real crisis
I've just started a petition about something which is really the only way for Apple to go. Please show them you mean it, that you want Apple to lead an open music market! Please sign the petition at: http://www.petitiononline.com/apple12/ Please help start this off! We all know what is the right thing for the industry to do. > I've just started a petition about something which is really the only way > for Apple to go. Please show them you mean it, that you want Apple to lead > an open music market! > > Please sign the petition at: I'd consider it - after Real gets real and quits harassing the rest of us who need to convert Real content to MP*. Real's penchant for business over customers and their fondness for throwing lawyers at consumers is sickening. > http://www.petitiononline.com/apple12/ First off, there's no crisis. Rob Glaser's hurt feelings != crisis. Second, I can't sign an incorrect petition. The MP4/AAC format IS open. It's like signing a petition asking people to open up the ASCII format. Fairplay DRM is not. Apple has licensed it to one other party (Motorola). They have not yet announced an "open enrollment" licensee program. I know Real wants Apple and other vendors to use their Helix DRM. Fine. Convene an industry consortium (like the DVD Forum), invite Apple, Microsoft, Napster, Sony, BuyMusic, and whoever else, and have them agree on a DRM standard. If Real wants Helix DRM to BE that standard, let them propose it, and let all parties accept it. If they want Fairplay to be that standard, let them propose THAT. No more of this underhanded crap. >> http://www.petitiononline.com/apple12/ [snip] > I know Real wants Apple and other vendors to use their Helix DRM. > [quoted text clipped - 5 lines] > let all parties accept it. If they want Fairplay to be that standard, > let them propose THAT. No more of this underhanded crap. Excellent post. With a depressed market cap of $940 million, Apple should consider just buying RealNetworks and being done with it. The one area that's hurting for Apple is streaming media content, especially with live video content. A purchase of RealNetworks could make all of that content available through QuickTime or iTunes. They could continue to sell the server software as is, but offer it free as part of their servers. This would result in a one time take-over charge, but increased revenues for Mac sales...not to mention the fact that it would bring more exposure and influence to the Mac server world. RealNetworks has been losing money for the past 9 consecutive quarters, but has been improving for the most recent ones and is on the verge of being profitable as is. Apple could strike a deal with Microsoft regarding the legal battle and that would greatly affect the bottom line of RealNetworks, and probably on more favorable terms for Apple than as it is now for them as a 3rd party watching that legal battle. >>> http://www.petitiononline.com/apple12/ >[snip] [quoted text clipped - 13 lines] >buying RealNetworks and being done with it. The one area that's hurting for >Apple is streaming media content, especially with live video content. Aha! Maybe Real is simply trying to force Apple into that very action! If so, they're pretty clever. The purchase would do many good things for all concerned, and Apple, with nearly five billion in the bank, could easily afford it. David Derbes >>>http://www.petitiononline.com/apple12/ > [quoted text clipped - 31 lines] > more favorable terms for Apple than as it is now for them as a 3rd party > watching that legal battle. I suspect that's precisely what Real wanted in the first place. Nicolas > With a depressed market cap of $940 million, Apple should consider just > buying RealNetworks and being done with it. The one area that's hurting for > Apple is streaming media content, especially with live video content. Thing is, Real doesn't have a useful technology. Apple already has streaming.  Signature"...crying in your drink is bad enough; crying into a hot fudge sundae is disgusting." - Jerry Farnsworth in _Job: A Comedy of Justice_ I agree with your responses. So why doesn't Apple take the lead and try to establish a DRM standard? If it's everybody against everybody, Apple surely isn't the one winning. Now, however, with all the cards in their hands, they could make a try to shape the industry and still be able to do what they want. It would surely give everybody a boost to talk now and act pre-emptively now. That's why a petition aimed at Apple would be useful, that's what I thought... > > With a depressed market cap of $940 million, Apple should consider just > > buying RealNetworks and being done with it. The one area that's hurting for > > Apple is streaming media content, especially with live video content. > > Thing is, Real doesn't have a useful technology. Apple already has > streaming. > I agree with your responses. So why doesn't Apple take the lead and try to > establish a DRM standard? If it's everybody against everybody, Apple surely [quoted text clipped - 3 lines] > pre-emptively now. That's why a petition aimed at Apple would be useful, > that's what I thought... I predict that Apple will keep doing things as they're being done now until and unless it looks like there's a danger of Microsoft making significant inroads with a proprietary format. At that point, Apple will offer up FairPlay as an industry standard. Signature"I want to thank my friend, Sen. Bill Frist, for joining us today.... He married a Texas girl, I want you to know. (Laughter.) Karyn is with us. A West Texas girl, just like me." -- George W. Bush in Nashville, Tenn., May 27, 2004 >> I agree with your responses. So why doesn't Apple take the lead and try to >> establish a DRM standard? If it's everybody against everybody, Apple surely [quoted text clipped - 8 lines] > significant inroads with a proprietary format. At that point, Apple will > offer up FairPlay as an industry standard. I totally agree with that. So far, things are looking good for Apple, despite Real. Apple is much better off if it can win the industry as opposed to offering up a DRM standard, even if it does get licensing fees. Also, I've never heard the definitive answer as to whether Apple *owns* Fairplay or just has an exclusive licensing agreement with Veridisc. If it's the latter and in perpetuity, than screw establishing it as a standard. What do you mean by "win the industry"? I think that Apple is doing well with iTunes, but many people will want other services, for a variety of reasons. If these systems are interoperable, the incentive will be greater both for iTunes customers and customers of other services to sign on and buy a lot of music. I think Apple is in a good position now to make a good move; everyone now looks at what Apple does next. So now, what exactly does Apple have to lose if it tries to propagate its FairPlay standard, or alternatively, just tries to bring the industry together? I think that is the only credible reaction to Real's gesture. > >> I agree with your responses. So why doesn't Apple take the lead and try to > >> establish a DRM standard? If it's everybody against everybody, Apple surely [quoted text clipped - 18 lines] > Fairplay or just has an exclusive licensing agreement with Veridisc. If > it's the latter and in perpetuity, than screw establishing it as a standard. > What do you mean by "win the industry"? The industry is not only in its infancy, it doesn't really fully exist yet. Right now we're talking about iTunes and the iPod. We're talking 12 cent profits on songs licensed to obsolete record labels. But the real money is going to start pouring in when/if Apple becomes critical in terms of going from the artist to the consumer in all areas of new technology consumption. Cell phones are already a huge business for what Apple could be delivering through the iTMS. Think iTMS is going to be big in a couple of years? Ringtones are already a much larger market. It's going to be totally insane. Cell phones with 100GB of storage (or more) are coming in the not too distant future. Apple should bizdev the hell out of itself to have iTunes "mobile" on every phone and the iTMS accessible through all cell phone service providers. We're talking billions of dollars a year on this alone. > I think that Apple is doing well with iTunes, but many people will want other > services, for a variety of reasons. That's nice, but how do other 3rd party services provide value to Apple shareholders? > If these systems are interoperable, the incentive will be greater > both for iTunes customers and customers of other services to sign on and buy > a lot of music. I don't see that happening. Instead I see initial competitors from a small set of players. Apple gets lost in the crowd. Remember a year or two ago when it seemed like everybody except for my grandmother was announcing plans to open a music store? What you're proposing is that Apple give up the one thing that's preventing all these idiots (like Coke, Nike, etc...) from competing with them. Furthermore, many companies would try to promote their other businesses...like Coke and McDonalds. Not so great for Apple to be trying to sell songs for 99 cents when McDonalds is giving away the same exact song files for free with a Happy Meal. > I think Apple is in a good position now to make a good move; > everyone now looks at what Apple does next. So now, what exactly does Apple > have to lose if it tries to propagate its FairPlay standard, or > alternatively, just tries to bring the industry together? I think that is > the only credible reaction to Real's gesture. Quite simply Apple has revenue to lose. Apple has power to lose. And more importantly, Apple has nothing to gain. It's one thing to say that building one store won't attract people, so you want other stores to come together and form a mall, but having more stores is not going to *significantly* attract enough people to make up for lost sales through competition. > Quite simply Apple has revenue to lose. Apple has power to lose. And more > importantly, Apple has nothing to gain. It's one thing to say that building > one store won't attract people, so you want other stores to come together > and form a mall, but having more stores is not going to *significantly* > attract enough people to make up for lost sales through competition. So what we need is a stockholder's petition demanding that Apple buy Real. How do we do this, and how do we publicize it? Signature"...crying in your drink is bad enough; crying into a hot fudge sundae is disgusting." - Jerry Farnsworth in _Job: A Comedy of Justice_ Yeah, but if you assume that the digital music industry is coming up strong, and everyone agrees to a DRM standard early on, then everyone should benefit in a big way from the tremendous growth. A good standard will also cause more players and other devices to be brought onto the market. Many players working in their own compartments will delay this kind of growth. Think of it as the transition from vinyl, then CD, and now digital music players. Vinyl to CD was a no-brainer (after a while), so you will want the transition to digital music players to be the same, and the earlier and the more decisively you can shape it, the better for you. As Apple is currently the market leader, it can offer other companies to take advantage of either its store or its player, and thereby create organic growth for its standard. That will put them in a more likely position to capture much bigger chunk of the entire market. They may sell less in percent of their market, but still a lot more in absolute numbers. (See you later, got to go..) > > What do you mean by "win the industry"? > [quoted text clipped - 49 lines] > and form a mall, but having more stores is not going to *significantly* > attract enough people to make up for lost sales through competition. > Yeah, but if you assume that the digital music industry is coming up strong, > and everyone agrees to a DRM standard early on, then everyone should benefit > in a big way from the tremendous growth. A good standard will also cause > more players and other devices to be brought onto the market. Many players > working in their own compartments will delay this kind of growth. Think of > it as the transition from vinyl, then CD, and now digital music players. What you're describing is the store->mall analogy. One store in the middle of nowhere won't attract people, but if you get lots of other stores and build a mall, you end up with more business even if some of those other stores compete with you...works with car dealerships and auto-rows as well. The problem is that in those cases the other stores/dealers are selling distinctly different products to the consumer and ordering from distinctly different sets of suppliers. Apple would be offering the same song files to the consumer and competing for the sale of the same exact product. Likewise Apple would be ordering from the same suppliers and bidding against its competitors. The digital music industry *is* coming up strong. It's in no way in Apple's interest to advance the industry if it doesn't mean direct sales for Apple. You note that Apple has the advantage of being the market leader, and I'm inferring that you think it's the best overall as well, so you think this will result in a draw from an overall larger pie...but the problem is that those that were drawn would've been drawn to Apple anyway. It would be one thing if MP3 players were a new, unknown technology, but consumers are very much aware of them, and the iPod *is* most likely what they're aware of. Likewise online music retailing is pretty well established in the minds of consumers...especially anyone with a player. > Vinyl to CD was a no-brainer (after a while), so you will want the > transition to digital music players to be the same, and the earlier and the > more decisively you can shape it, the better for you. Exactly...which is why they shouldn't give up Fairplay. By controlling that, they are absolutely 100% decisively shaping everything (or close enough for now). > As Apple is currently > the market leader, it can offer other companies to take advantage of either > its store or its player, and thereby create organic growth for its standard. That's great, Fairplay is *the* standard, but the iPod isn't and neither is the iTMS. As an Apple shareholder, would you rather have everyone in the world: 1) Buy Fairplay songs and buy Fairplay compatible players. 2) Buy all songs from the iTMS and only buy iPods. > That will put them in a more likely position to capture much bigger chunk of > the entire market. They may sell less in percent of their market, but still > a lot more in absolute numbers. Why would Apple end up with a bigger piece of pie overall? Sure, no doubt the market would grow bigger and faster with more competitors, but while it's clear that due to the inherent definition of competition, Apple would lose sales, it's in no way clear how Apple would gain sales. I could go to the auto-row to see about buying a Ford, but end up buying a Chevy, when I would've ended up not buying the Ford at all (and vice versa), but Apple isn't having a problem selling people on the idea of buying an iPod or the concept of an MP3 player. You could even argue that their dominance actually persuades consumers into the market more than competition would, as the industry is well beyond the early adopter phase and the remaining following consumers tend to be confused by too much technology choice. > > Yeah, but if you assume that the digital music industry is coming up strong, > > and everyone agrees to a DRM standard early on, then everyone should benefit [quoted text clipped - 15 lines] > for the sale of the same exact product. Likewise Apple would be ordering > from the same suppliers and bidding against its competitors. I think there is still a lot of distinction possible, given the enormous range of music and the different ways it can be presented, and you could combine it with more music videos and music-related on-demand offerings. More competitors and more volume might also bring the price down and decrease overhead, allowing 10 million songs to be sold instead of 700'000. Cheaper prices for songs will again increase value and the volume of consumer purchases. > The digital music industry *is* coming up strong. It's in no way in Apple's > interest to advance the industry if it doesn't mean direct sales for Apple. [quoted text clipped - 10 lines] > Likewise online music retailing is pretty well established in the minds of > consumers...especially anyone with a player. My feeling is that the wider public are very willing and ready to consider players besides the iPod when they come out, because of price, features, and so on. If Apple got them to adopt its Fairplay, wouldn't Apple feel a lot safer? Most of the people who now own iPods will probably stick to it. The trouble is, in my mind, that one offering by a single company which is new to the market will arouse more suspicion than confidence. For real growth, you need something rock solid, guaranteed to be attractive in the next 30 years. This can only be achieved by capturing the market and making sure that all potential competitors are on your track and no one can turn it around. To be sure, competitors *are* going to arrive, so we are definitely going to face tough competition. The idea is to soften this competition. > > Vinyl to CD was a no-brainer (after a while), so you will want the > > transition to digital music players to be the same, and the earlier and the [quoted text clipped - 33 lines] > early adopter phase and the remaining following consumers tend to be > confused by too much technology choice. Look at these later >> What you're describing is the store->mall analogy. One store in the > middle [quoted text clipped - 14 lines] > range of music and the different ways it can be presented, and you could > combine it with more music videos and music-related on-demand offerings. How would the songs files themselves be different in any way? Apple is open to offering *any* music where it can strike agreements with the labels. Most other stores are/would do the same. It's not like as if Apple has Rock down, but someone else could carry Jazz. It's in Apple's interest to have every song available in its store, and that's what they're shooting for (as is everyone else). Presentation? Sure, the interfaces to the music can change, but the goal of every store is to optimize their interfaces. Apple is great at this, but so are others. Given time and money, others would great at the very least, "good 'nuff" interfaces and presentation. Your argument sounds more and more like asking Tower Records to allow (geez I can't even think of a name of a record store, do they still exist) another record store to open up on its lot of land. What's in it for them except loss of sales. > More competitors and more volume might also bring the price down and > decrease overhead, allowing 10 million songs to be sold instead of 700'000. > Cheaper prices for songs will again increase value and the volume of > consumer purchases. My argument from the beginning has been with total disregard for what's best for the consumer and with focus on what's best for Apple shareholders, since this is what drives the decision for any corporation. With that in mind "prices" have two values. The first is the price Apple pays the label, the second is the price consumers pay Apple. The problem is getting those agreements with the labels...going against competitors all struggling for exclusive agreements is not going to help Apple receive better pricing. In fact, it will increase the price Apple pays labels while at the same time lowering the price that consumers pay Apple (or at least pressure is applied in those directions). Also, your statement is flawed in that more competitors doesn't decrease overhead. Apple's business scales as it's volume increases. The success of its competitors doesn't scale Apple's business at all. If lower prices was key to optimizing profits, Apple could go ahead and do that on its own, it doesn't need to do so to react to competition. >> You note that Apple has the advantage of being the market leader, and I'm >> inferring that you think it's the best overall as well, so you think this [quoted text clipped - 11 lines] > players besides the iPod when they come out, because of price, features, and > so on. No doubt. > If Apple got them to adopt its Fairplay, wouldn't Apple feel a lot > safer? Why? $200 going to a Rio with Fairplay is $250 not going to Apple for an iPod. > Most of the people who now own iPods will probably stick to it. The > trouble is, in my mind, that one offering by a single company which is new > to the market will arouse more suspicion than confidence. Have you seen the sales numbers for the iPod? 70% of hard drive players, 52% of all MP3 players, and those numbers go up when you do a comparison of actual in use players, and totally go up when you compare players where owners are buying downloadable music. I don't think the iPod has a confidence problem. It has a supply and production problem maybe, but that's about it. > For real growth, > you need something rock solid, guaranteed to be attractive in the next 30 > years. This can only be achieved by capturing the market and making sure > that all potential competitors are on your track and no one can turn it > around. That sounds great, but it's not a real issue concerning Apple or the success of the iPod. Sure, at some point if WMA players and store start to gain momentum, Apple should re-evaluate their decision, but if actually given a choice in the matter, they're much better off owning the player market and the online distribution market. > To be sure, competitors *are* going to arrive, so we are definitely going to > face tough competition. The idea is to soften this competition. Hmmm.... You want to open a music store and can't sell your songs to 70% of the players. Is that soft enough? Or You want to sell a player, but can't make it compatible with the store that sells 70% of the music. Is that soft enough? Oh, and the growth of these numbers is still going upward. Let me just say this again to be clear for anyone joining in here...This should be Apple's course of action *today*. They should constantly be re-evaluating this based on what's going on in the market. Let me paraphrase my argument again. a) Competitors to the iPod are appearing. There are two options: - They support Fairplay in their formats supported. - They do not support Fairplay Consumers will buy these devices, whether they support Fairplay or not. If, however, Apple and record companies managed to stick in Fairplay, the doorway for them to use iTunes Music Store is still open. b) Competitors to the iTunes Music Store are appearing. - They support Fairplay. They can still use other formats for the music, but Fairplay is in there. - They do not support Fairplay Customers will use these systems as part of bundling deals (bundled with the operating system, perhaps). Customers will come from everywhere. If Apple and record comapanies struck a deal with them, they have the option of buying an iPod. It looks risky for Apple, but I feel it isn't, as their base will be much broader. Despite the technical lead of iPod and the iTMS, you can't count on everyone buying into them. There is a lot of cultural impact, issues of customer treatment, and so on. As only 2 million people now own iPods, and the base of musically interested users is much greater, you can reckon there are a lot of people holding out for these reasons. The only thing Apple can do is to bring everyone together as fast as possible and have their say, and they're in a good position to do that now. There are a lot of industries the tech biz that said, "If only we had talked about standards beforehand." Now, Apple can do both that and have a big say. > >> What you're describing is the store->mall analogy. One store in the > > middle [quoted text clipped - 18 lines] > to offering *any* music where it can strike agreements with the labels. Most > other stores are/would do the same. I'm not sure. I believe they chose to include 700'000 songs for economical reasons, when they could have included 10 million. > It's not like as if Apple has Rock down, but someone else could carry Jazz. > It's in Apple's interest to have every song available in its store, and [quoted text clipped - 21 lines] > "prices" have two values. The first is the price Apple pays the label, the > second is the price consumers pay Apple. I'm taking a somewhat different view here, that business decisions should be long-term and consumer oriented, and that Apple should think this way, too. I'm arguing the price for songs bought with Apple's licensing model will decrease as the volume increases and record companies feel safer. Apple's licensing model would also stimulate growth in the entire industry, obviously bringing down the prices for Apple, as well. > The problem is getting those agreements with the labels...going against > competitors all struggling for exclusive agreements is not going to help [quoted text clipped - 8 lines] > If lower prices was key to optimizing profits, Apple could go ahead and do > that on its own, it doesn't need to do so to react to competition. I think that for the music business, not the computer business, Apple should get rid of their high price policy, and instead entice customers to buy a lot more "great" music. If they go for volume early on, they should have nothing to fear. I say, they are forced to do it. > >> You note that Apple has the advantage of being the market leader, and I'm > >> inferring that you think it's the best overall as well, so you think this [quoted text clipped - 19 lines] > Why? $200 going to a Rio with Fairplay is $250 not going to Apple for an > iPod. Yeah, but most likely the person buying the Rio would never have considered buying an iPod. There may be a cultural barrier at work here, personal preference, whatever. So, I argue, the Rio would just have extended Apple's reach. > > Most of the people who now own iPods will probably stick to it. The > > trouble is, in my mind, that one offering by a single company which is new [quoted text clipped - 7 lines] > I don't think the iPod has a confidence problem. It has a supply and > production problem maybe, but that's about it. Yeah, that is tricky, of course. Naturally, Apple's is the first system that really works, but others will catch up. Apple probably thinks they are miles ahead, but that applies only to their technology. But the biggest confidence problem stems just from the market size. A small market size prevents Apple from going it alone, as they alone cannot guarantee unlimited lifetime and portability. > Let me paraphrase my argument again. > > a) Competitors to the iPod are appearing. Appearing, but not succeeding yet (keep in mind my statements are only in regards to the current status). > There are two options: > [quoted text clipped - 4 lines] > however, Apple and record companies managed to stick in Fairplay, the > doorway for them to use iTunes Music Store is still open. I think people fall into two camps: 1) The player is for illegal downloads and rips of their own CDs 2) There is value in downloading songs legally from *good* online stores. For people who would buy songs online, the iTMS is a huge draw for buying the iPod and not a competitive product. Those in the former category don't impact things either way. In the current situation iPod profit is an order of magnitude above online music sale revenue. Thus the math doesn't currently make sense to increase music sales at the expense of lost iPod sales. It doesn't even come close. Apple get a yearly profit currently of about $10 million profit from the iTMS, but receives about $400 million profit on iPods. I *do* believe these numbers will flip, but for now, the priority is the iPod *and* the iTMS will be in a stronger position as Apple continues to sell more iPods. > b) Competitors to the iTunes Music Store are appearing. And again not succeeding. How can they when they can't sell to over 70% of the market? > - They support Fairplay. They can still use other formats for the music, but > Fairplay is in there. [quoted text clipped - 4 lines] > and record comapanies struck a deal with them, they have the option of > buying an iPod. Currently, the Fairplay issue aside, there still isn't a fundamental competitor in the same league as the iTMS. There isn't significant market differentiation beyond the Fairplay issue. So what you have are iPod users and potential owners not really looking at other stores much and feeling left out beyond just the general concept of choice and insignificant price differences. The problem is that by doing this, you sale more iPods today, which is good, but the iPod is then not tied to the store, so when it comes time to switch focus to iTMS as the profit center, Apple will be facing numerous competitors without any clear market differentiation. > It looks risky for Apple, but I feel it isn't, as their base will be much > broader. How will their base be any broader? Not just a surface answer, but delve deeper into the issues. By doing this, you open the iTMS to at most 30%, but most likely much less than that 30% since you couldn't expect Apple to actually get licensing for that full amount as compared to WMA. In other words, you get a potential of 30%, a reality of significantly much less, and a competitive edge loss that is much more (on either side you look at). > Despite the technical lead of iPod and the iTMS, you can't count on everyone > buying into them. There is a lot of cultural impact, issues of customer > treatment, and so on. As only 2 million people now own iPods, and the base > of musically interested users is much greater, you can reckon there are a > lot of people holding out for these reasons. That's 4 million iPods...or higher if they've grown since *I* last looked. The main hold out has to do with being able to produce to demand and price issues. Opening the market to competitors hurts Apple on both counts. Again, none of what I say has anything to do with what is best for consumers, just Apple shareholders. > The only thing Apple can do is to bring everyone together as fast as > possible and have their say, and they're in a good position to do that now. > There are a lot of industries the tech biz that said, "If only we had talked > about standards beforehand." Now, Apple can do both that and have a big say. Yes, but there are also many that have looked back and questioned why they gave a market that they could've owned away. If people start buying other players, or if people start buying from other stores, Apple should react, but currently, this isn't happening and Apple is on the path to continue dominating both markets. I respect your position, and have enjoyed this debate. I'm leaving on vacation for a while. If you don't get a response it's because I'm sailing around Catalina. Oh, and regretfully, I'll be using my old 20GB MP3 player as I don't have an iPod *yet*. I got it a year or so before the iPod was announced. > Also, I've never heard the definitive answer as to whether Apple *owns* > Fairplay or just has an exclusive licensing agreement with Veridisc. If > it's the latter and in perpetuity, than screw establishing it as a standard. I would have agreed, although there were largely unsubstantiated rumors a while back that Apple had essentially bought the technology from Veridisc and thus now owned it. Apparently, they are confirmed, otherwise I can't see how Apple could have as a licensee itself turned around and licensed it to somebody else (i.e. Motorola). Clearly, it is Apple's technology (in terms of ownership rights), although some analysts appear not to know that when they speak of "Apple Fairplay," Apple did not create it. >> Also, I've never heard the definitive answer as to whether Apple *owns* >> Fairplay or just has an exclusive licensing agreement with Veridisc. If [quoted text clipped - 3 lines] > a while back that Apple had essentially bought the technology from > Veridisc and thus now owned it. Nothing to agree or disagree with. I don't know the answer. > Apparently, they are confirmed, otherwise I can't see how Apple could > have as a licensee itself turned around and licensed it to somebody else > (i.e. Motorola). Not necessarily. Apple is going to provide the iTunes/iTMS service through Motorola cell phones. They aren't giving Motorola a license to open their own store. A license from Veridisc could easily have contained permission to develop on platforms other than OS X. I would kinda think so, given that they have a Windows version, and would want to cover all bases. > Clearly, it is Apple's technology (in terms of ownership rights), > although some analysts appear not to know that when they speak of "Apple > Fairplay," Apple did not create it. Can anyone point to any proof of this? The Motorola deal certainly isn't proof. I just think it's odd that there's no press release "Apple buys Veridisc/Fairplay" or info in their quarterly announcements, but they sure do *act* like as if they own Fairplay. Of course the state of the Veridisc Website could not confuse matters any further if they tried. > I predict that Apple will keep doing things as they're being done now > until and unless it looks like there's a danger of Microsoft making > significant inroads with a proprietary format. At that point, Apple will > offer up FairPlay as an industry standard. I suspect that if Microsoft and Adobe ganged up on Apple and came out with a "standard" which would toast Apple no question (I'm thinking as Apple and MS did with Type 1 fonts and TrueType).... Signature"...crying in your drink is bad enough; crying into a hot fudge sundae is disgusting." - Jerry Farnsworth in _Job: A Comedy of Justice_ >> With a depressed market cap of $940 million, Apple should consider just >> buying RealNetworks and being done with it. The one area that's hurting for >> Apple is streaming media content, especially with live video content. > > Thing is, Real doesn't have a useful technology. Apple already has > streaming. The technologies don't really matter much. Real/Apple/Windows Media, they all have their strengths and weaknesses, but none in anyway is significantly better than the other. Certainly not $940 million worth, not even $940 worth. What is significant is the content that's available in Real. It comes up time and time again. BBC is Real, CNET is Real/Windows Media, etc... One aspect of the purchase is that Apple would be buying a doorway into that content, which would help boost QuickTime and iTunes installations as the Real codecs/protocols were incorporated. Think Real sucks all you want, but they have a lot of content providers, a lot of servers in use, and a lot of installed and active players. This is just the content aspect of the acquisition. Just as big of a deal comes from Xserve sales when they include Real server software for free, and the settlement deal Apple could get in the lawsuit against Microsoft. Real is suing for one thing with one possible remedy. It's a total quagmire for Real and it's costing them big $$$. For Real to negotiate, all they can do is deal with the value of the settlement...in essence Microsoft agreeing to the level of their wrong doing. For Apple, negotiations can take place across the spectrum of all business relations. At $5 billion in cash reserves, Apple *needs* to start investing, and Real makes perfect sense. > At $5 billion in cash reserves, Apple *needs* to start investing, and Real > makes perfect sense. Yes and no. It makes sense for them to invest. I don't agree that it makes sense for them to put much into Real. You'll note that MS, which has a lot more money, doesn't appear to be going with Real either, and they need to invest at least as much as Apple. As I see it, the sites with "Real" content don't have any such. For instance, CNN.com uses Real. It also charges. In this case, either of those is enough for me to depreciate that "content" to zero, as far as interest. Same for the rest. I've yet to see any unReal content compelling enough to get me to load that crap. I speak from experience. I've been known to *pay* Real, then be seriously disillusioned by the "content" I get. There's no "there", there. Signature"...crying in your drink is bad enough; crying into a hot fudge sundae is disgusting." - Jerry Farnsworth in _Job: A Comedy of Justice_ >> At $5 billion in cash reserves, Apple *needs* to start investing, and Real >> makes perfect sense. [quoted text clipped - 3 lines] > has a lot more money, doesn't appear to be going with Real either, and > they need to invest at least as much as Apple. MS needs to invest in itself, not deal with he headaches (legal and logistical) of acquiring Real. Even so, MS doesn't have the same incentives for it at Apple. It's not going to help them sell servers, it's not going to help them distribute clients, it's not going to significantly grow their audience. The only thing in it for MS is the ability to eliminate a competitor and resolve a lawsuit...for that it would pay a premium. > As I see it, the sites with "Real" content don't have any such. For > instance, CNN.com uses Real. It also charges. In this case, either of > those is enough for me to depreciate that "content" to zero, as far as > interest. Same for the rest. I've yet to see any unReal content > compelling enough to get me to load that crap. Like I said before, like Real or hate Real, the issue is the number of content providers and the number of users. For streaming content, these numbers are significant. > I speak from experience. I've been known to *pay* Real, then be > seriously disillusioned by the "content" I get. There's no "there", > there. The entire BBC archives? Apple shouldn't purchase Real based on any assessment of the quality of content. That's totally irrelevant as a business decision. Go with the assumption it all sucks, it doesn't matter. Enough people are into it enough to download, install and *use* the Real player, many of them on a regular basis. > Apple shouldn't purchase Real based on any assessment of the quality of > content. That's totally irrelevant as a business decision. Go with the > assumption it all sucks, it doesn't matter. Enough people are into it > enough to download, install and *use* the Real player, many of them on a > regular basis. Nonono, guess I wasn't clear. I'm talking about the quality of what Real delivers. In other words, RealVideo, as an example, is about as good IMO as a color TV in an area far away from any actual TV stations, in the era before cable. The *technical* quality sucks a.s, hard. Signature"...crying in your drink is bad enough; crying into a hot fudge sundae is disgusting." - Jerry Farnsworth in _Job: A Comedy of Justice_ >> Apple shouldn't purchase Real based on any assessment of the quality of >> content. That's totally irrelevant as a business decision. Go with the [quoted text clipped - 6 lines] > good IMO as a color TV in an area far away from any actual TV stations, > in the era before cable. The *technical* quality sucks a.s, hard. Nononono, guess *I* wasn't clear;) None of that matters. Lots of content in Real or Real/WM format + Lots of Real content providers + Lots of Real servers + Lots of Real client installs + Lots of daily Real users = the incentive. If that formula is true, it wouldn't matter if Real technology hadn't progressed past 1997 levels and if the content looked like bad Russian porn edited for the Disney channel. One day of the acquisition, Apple brings the codecs and protocols into Quicktime/iTunes. This means that people would no longer have to use the Real player and users could download Apple's client instead. The existing Realplayer would work (for some time), and the servers could still send Real content. At the same time Apple delivers QuickTime/iTunes codecs/protocols for existing Real producers and servers. CNN et al, could now much easily start offering QuickTime content if that's the way they wanted to go, but it wouldn't matter since Real content would be QuickTime content. It's only a matter of them choosing to change if they felt the new codecs/protocols were better for them. And this is were the servers come in. Content providers could keep licensing the Real server software for their platform, but they could get the server license for free with the Xserve. Eventually everyone is using Apple technology, as opposed to now where if someone dumps Real, they have the choice of Apple or Windows, and the switch to Apple is *probably* going to be a bigger jump for them. > Eventually everyone is using Apple technology, as opposed to now where if > someone dumps Real, they have the choice of Apple or Windows, and the switch > to Apple is *probably* going to be a bigger jump for them. Okay, you're probably right. I just don't like thinking that way. I prefer winning on merit rather than through finagling the field, but I guess that's why MBAs were invented. <half-grin> And if it works, and especially if it makes my stock worth more, I can't complain, now can I? Signature"...crying in your drink is bad enough; crying into a hot fudge sundae is disgusting." - Jerry Farnsworth in _Job: A Comedy of Justice_ Howard Shubs <howard@shubs.net> wrote: > MR_ED_of_Course <OhNoSPAM@pacbell.net> wrote: > [quoted text clipped - 4 lines] > Thing is, Real doesn't have a useful technology. Apple already has > streaming. http://www.drunkenblog.com/drunkenblog-archives/000312.html Most of what he says is right on the button. Apple's mpeg4 codecs are quick'n'dirty, I know, I use 'em... No amount of blogs & usenet flamewars will influence the patent attorneys & corporate politics. It doesn't matter who "wins", there will always be losers, us, the content providers and the joes who watch it :-( > With a depressed market cap of $940 million, Apple should consider just > buying RealNetworks and being done with it. The one area that's hurting for > Apple is streaming media content, especially with live video content. That would be like buying a cake riddled with worm eggs. I suppose they could sack all the top executives/staff, but that would loose them on the rest of the world and they would inevitably form or join other companies which would end up equally parasitic. Perhaps there is a sterilisation procedure? Andy > I've just started a petition about something which is really the only way > for Apple to go. Please show them you mean it, that you want Apple to lead [quoted text clipped - 6 lines] > Please help start this off! We all know what is the right thing for the > industry to do. The right thing for Apple to do is to reverse engineer the RealMedia formats and make them playable in Quicktime. Tit for tat. Thoughts? > Please help start this off! We all know what is the right thing for the > industry to do. Yeah, to squish Real like the cockroach it is. Signature"...crying in your drink is bad enough; crying into a hot fudge sundae is disgusting." - Jerry Farnsworth in _Job: A Comedy of Justice_ > I've just started a petition about something which is really the only way > for Apple to go. Please show them you mean it, that you want Apple to lead [quoted text clipped - 6 lines] > Please help start this off! We all know what is the right thing for the > industry to do. Once you download music from iTunes can you burn it to a standard audio CD??? If so, simply burn your music and re-rip it to MP3. Works with other online music vendors. :) Not convenient if you have TONS of music, but just an idea. - Ringo - Yeah right, it works, but I thought a petition could work in a different way... > > I've just started a petition about something which is really the only way > > for Apple to go. Please show them you mean it, that you want Apple to lead [quoted text clipped - 13 lines] > > - Ringo - |
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