How long will it take Apple lawyers to respond to this?

According to the New York Times, Universal, the world’s biggest music conglomerate, said it would offer albums and songs without the software, known as digital rights management, through existing digital music retail services like RealNetworks and Wal-Mart, nascent services from Amazon.com and Google, and some artists’ Web sites” but not through iTunes, the world’s biggest seller of digital music.

While I am a mere bleacher-seat observer of this and don’t even pretend to understand the law, I’d like to ask any trade-attorney-types out there the following: Aren’t there factors related to restraint of trade that would make it difficult for Universal to distribute product through all available channels but the iTunes Store? While I can completely understand Universal wanting to put the horse back in the barn by doing this, I would think (again, as a mere layman unschooled in such legal nuances) that the “public at large” would have standing in this issue.

Let’s say Universal made the announcement they were only going to sell DRM-free music through Walmart.com (it’s theme night). Wouldn’t that trigger a flood of restraint-of-trade complaints?

Why is this any different?

Even if it’s not a tight case, is there enough of an argument here to yank Universal’s chain?

For the record, this is a first: I’ve never come close before to encouraging or supporting any action by those lawsuit-happy Apple barristers.

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  • Hudge

    I’m even less of a lawyer. However, I can think of instances of “Available Exclusively Through>>>” Visa spent years promoting itself like this at events like the Olympics. Some fast-food places sell Coke, others sell Pepsi.

  • Fred

    I am a lawyer, but this is not my area of expertise. Anyway, it is possible to make a refusal to deal claim under Section 2 of the Sherman Act, but in order to do so, you’d have to be able to prove that Universal has monopoly power in one market and is trying to use that power to foreclose competition in another. For example, Kodak lost a case in which it refused to license its patented replacement parts to independent service providers in order to prevent competition in the market for servicing its copiers. The argument is that patent=inherent monopoly. Not all courts even agree with that. You’d have to draw the relevant market very narrowly for Universal to have monopoly power (i.e. not just “all music” but “all music of artist X”), and that seems unlikely. Generally, if you no not have market power, you can sell to whomever you want and not sell to whomever you don’t. It’s a moot point anyway, as Universal would be under no obligation to offer identical license terms, so even if they had to license to Apple, they could just offer to do so at $5 per track.

  • Rex Hammock

    In subsequent coverage, the term “test” has been applied to Universal’s decision — as in, “it’s a test to see if this works.” However, it is clearly also a test if the dominant owner of music can leverage that role into insuring there are alternatives to the delivery of its product through channels other than the dominant retailer. It’s going to be a “who blinks first” drama to enjoy for us humans.