Stan Beer
Monday, 16 October 2006 13:08
Opinion and Analysis
Page 1 of 3
A recent interview between Apple founding CEO Steven Jobs and Newsweek editor Steven Levy was most instructive with respect to the differences between Apple and Microsoft when it comes to fighting piracy of music and software.
To be clear on what we are talking about,
both Microsoft and Apple have been wildly successful in creating
dominant - in Microsoft's case monopolistic - market shares in their
respective areas of desktop software and portable music players.
In the case of both companies they have had to contend with the thorny
issue of piracy. In many ways, their successful approach has been
exactly the same - to turn a blind eye to it.
The Jobs interview, which marked the fifth anniversary of iPod,
revealed that the Apple co-founder claims that if you charge the market
a price it will accept for music, users will forgo illegal downloads
and pay iTunes to download tracks. Jobs is indeed correct when he says
this strategy has worked - iTunes has had something like 1.5 billion
downloads.
What Jobs didn't say, however, is that the strategy only works up to a
point. Of the hundreds and sometimes thousands of tracks that each iPod
owner has on his or her player, on average only 20 to 25 were bought
through iTunes.
Where did the rest come from? They were ripped from CDs, downloaded
from other legal music sites, burned to CDs and then ripped from CDs,
downloaded from illegal file sharing music sites - well you get the
picture.
The fact is that iTunes is the most convenient way to get music onto
your iPod but it is certainly not the only way. Apple knows this all
too well.
Yet, with 80% market share or so, Apple has no intention of checking
the contents of their iPods for illegal downloads each time they
download a new iTunes track. A good way to reduce piracy for Apple
would be to stop users from being able to rip tracks off CDs. Apple
could reduce it even further by preventing users from burning tracks to
CDs. After all, with an iPod that can be plugged into a home or car
sound system, who needs CDs?
