Since its debut a couple of years ago, the iTunes Music Store has shot to number one with a bullet. Whether you ascribe its success to Apple’s being the first to offer DRM consumers could live with, iTMS’ being tied exclusively to the iPod, the iTMS shopping experience, or a combination of the three, the fact remains that iTMS dominates the digital music download market.
Recently, Apple has come under fire in Europe for not opening up its FairPlay DRM. However, the European Commission—the entity responsible for enforcing EU antitrust law—is reluctant to move against Apple’s domination of the music market. Citing the company’s emergence in a free and open market, EC director general of competition Philip Lowe thinks it is too early to force Apple’s hand:
"We wouldn’t at this stage regard this as an instance of major concern until we’ve seen further market developments," Lowe told reporters this week.
Some European nations feel differently. Earlier this month, the Norwegian government found that Apple’s FairPlay DRM was unreasonable. The finding came in response to a complaint filed early this year by the Consumer Council of Norway, alleging violations of Norway’s Marketing Control Act. Apple is now faced with a June 21 deadline to respond to the Consumer Ombudsman Erik Thon’s decision.
Apple dodged a bullet last month, when the French Senate weakened legislation passed by the lower house of Parliament. The law would have forced the company to make its FairPlay DRM scheme available to competitors so they could sell music capable of playing on portable devices other than the iPod.
The central issue is Apple’s practice of tying customers to its vertically-integrated music business by refusing to license its DRM. Some believe that isn’t playing fair, including Thon.
Thon cited Norwegian consumer law as saying contracts must be "fair and balanced," adding that the approach taken by Apple violated "basic consumer principles."
"We believe that it could be questioned (as) an infringement of rights. I have the right to use whatever I bought to what I want to use it for," he said.
Although the EU will apparently take a wait-and-see approach with the issue, member states are free to move at their own speed. France is mulling over yet another copyright bill that would require Apple to open up FairPlay, and other countries are moving in a similar direction. Apple may soon be faced with the unpleasant choice of having to license FairPlay or exit certain markets.