Apple and Music Labels Face European Commission Antitrust Probe

While things are definitely moving forward for Apple when it comes to interoperability and DRM restrictions, the company still has issues to deal with in Europe. After Brussels issued formal charges alleging that the deals that underpin the sale of music through the hugely popular iTunes platform violate competition rules, Apple and several of the major music labels are looking at a European Commission antitrust probe.

Last week, the Brussels regulator sent out a confidential statement of objections outlining the accusations to Apple and what is believed to be Universal, Warner, EMI and Sony BMG.
The problem is not new, the Commission’s main concern being that the current set-up of the iTunes Stores in the European market limits the users in their choices. As it stands, a user cannot purchase and download music from the iTunes Store of another country, thus fracturing the market.

While the European Commission is right on this one, Apple is caught in the middle, being forced to play within the rules of the labels if they want to be able to offer their content, but breaking European law in doing so.

"Apple has always wanted to operate a single, pan-European iTunes store, accessible by anyone from any member state," an Apple spokesman said. "But we were advised by the music labels and publishers that there were certain legal limits to the rights they could grant us. We do not believe the company did anything to violate EU law, and we will continue to work with the EU to resolve this matter," he said.

While undoubtedly Apple would have preferred a single, pan-European iTunes store, and still does, it is the labels themselves that need to make the necessary changes. Digital music and Internet distribution have rendered the old-fashioned licensing agreements obsolete, and new ones need to be put in place before things can start moving forward again.

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