Apple, EC to settle iTunes pricing case

By Stephen Withers
Wednesday, 09 January 2008 01:32

Technology

Apple is set to resolve charges by the European Commission that its country-based iTunes Stores contravene European Union rules.

The iTunes Store charges different prices in different countries (eg, €0.99 per track in France, but a more expensive £0.79 in the UK), and maintains this policy by restricting customers to their local iTunes Store.

According to reports, Apple will announce changes this week, after which the EC will close its case.

The nature of the changes are not yet known, but could involve a single pan-European iTunes Store, or a harmonisation of prices.

Apple position has been that it would rather operate a single store, but the country-by-country policy was forced on it by the big record labels. Agreements restricting competition along national lines can attract a fine of up to 10 percent of annual sales, but it is not clear whether such penalties could be applied to Apple, the record companies, or both. Nor is it known at this stage if any fines will be levied, or if the EC will consider the changes an adequate outcome.

At the time the EC investigation began, an Apple spokesperson said "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."