Apple's Music Business Being Looked Into By Justice Department
Apple's iTunes service has revolutionized the music industry. There's little debating that. Since it was introduced in 2003, CD sales have continued to slide, while iTunes sales have continued to soar. Apple has somehow managed to not only beat out Wal-Mart in overall music sales in the United States, but trounce it. Currently, iTunes accounts for 28% of all music sales in America, while Amazon and Wal-Mart are tied for second place with 12% each. That's domination.
But that domination brings eyes, and now the U.S. Justice Department is investigating whether or not Apple's music practices are all within the realm of the law. These inquiries aren't uncommon; many huge corporations are investigated to make sure that antitrust laws aren't being broken, and this particular investigation is said to be in the very earliest of stages. According to "several people briefed on the conversations," Apple is being questioned about "recent allegations that Apple used its dominant market position to persuade music labels to refuse to give the online retailer Amazon.com exclusive access to music about to be released."
No official statements have been made by any company involved, and obviously we're nowhere near Apple facing any sort of penalty (or even being proven guilty), but this definitely raises some interesting concerns. With the music business shifting so quickly from physical to digital format, Apple really needs some competition. One major reason that people default to iTunes is the popularity of the iPhone and iPod; other services generally "work" with these devices, but the syncing isn't nearly as streamlined.
We suspect that the outcome of this will be interesting to watch, and depending on the decisions that are made, this could definitely impact the future of digital downloads and music consumption.
But that domination brings eyes, and now the U.S. Justice Department is investigating whether or not Apple's music practices are all within the realm of the law. These inquiries aren't uncommon; many huge corporations are investigated to make sure that antitrust laws aren't being broken, and this particular investigation is said to be in the very earliest of stages. According to "several people briefed on the conversations," Apple is being questioned about "recent allegations that Apple used its dominant market position to persuade music labels to refuse to give the online retailer Amazon.com exclusive access to music about to be released."
No official statements have been made by any company involved, and obviously we're nowhere near Apple facing any sort of penalty (or even being proven guilty), but this definitely raises some interesting concerns. With the music business shifting so quickly from physical to digital format, Apple really needs some competition. One major reason that people default to iTunes is the popularity of the iPhone and iPod; other services generally "work" with these devices, but the syncing isn't nearly as streamlined.
We suspect that the outcome of this will be interesting to watch, and depending on the decisions that are made, this could definitely impact the future of digital downloads and music consumption.
