Europe, the new IP Soviets

By Stan Beer
Friday, 26 January 2007 06:03

Opinion and Analysis

Question for European governments: does a company have a right to protect intellectual property it spent hundreds of millions to develop or is that IP by government decree suddenly the property of the state? Another question: are 100 million iPod owners around the world wrong in CHOOSING to be bound by Apple's conditions of purchase?

Norway, with a population of 4.6 million, is just a tiny blip in the vast global village. Apple sells twice as many iPods each quarter as the entire population of the picturesque Scandinavian country. However, the way the Norwegian government is beating its chest in righteous indignation over the way Apple sells its products, one would think Norway is a giant super power.

However, let's not kid ourselves. If it was only quaint little Norway venting its spleen on this issue, the matter would probably rest there. The problem for Apple is that now other more substantial European countries are also raising their voices in shrill protest against free enterprise. The latest to join the fray is the Netherlands government body, the Dutch consumer protection agency and so-called consumer rights advocates in other larger European countries such as Germany and France are also becoming more vocal.

A little reminder of a fact to any European government entertaining the notion of following Norway's lead: the fall of the Soviet Union was more than 15 years ago. Like the US, UK, Canada, Australia, Japan, Taiwan, South Korea and other developed countries in the free world, much of Europe has prospered because of free enterprise not socialism.

You complain that what Apple is doing is not free enterprise? Well think again. Apple developed its excellent music store using its own money. Apple developed its own excellent music player using its own money. Then Apple developed an exceptional business model and marketing program using its own money. What's more, as a latecomer to the music player market, it did all this in the face of stiff competition.

You complain that what Apple is doing restricts the choice of consumers? Garbage. Consumers in Europe and elsewhere are free to choose not to use iPods or buy music from iTunes. When they make their purchasing choice, they're probably more informed than the users of any other music player what the restrictions are on buying music from iTunes or playing music on the iPod. Despite this, they keep buying iPods and downloading music from iTunes in increasing numbers.

You complain that Apple's business model locks the consumer in to its products. Untrue. Simple mathematics tells us that the majority of music on iPods has not been downloaded from iTunes but most likely been ripped from CDs. What's more, music downloaded from iTunes can always be burned to CDs, which then removes all DRM restrictions.

You complain and complain about Apple because it happens to be the most successful music player company by far. However, to be consistent shouldn't you also be complaining about Sandisk, Creative and Microsoft. These companies also make music players and subscribe to DRM systems that other music download sites, such as Napster, use. Shouldn't you also go after Napster and Zune Marketplace. Oh that's right, you intend to do that as well.

European governments, consumer watchdogs, and assorted do-gooders who would seek to protect us consumers from the evils of music player lock-in, please tell us who among the 100 million iPod users are complaining. Please explain why consumers continue to use iTunes and iPods. Please explain why you believe that you know what's good for them better than they do? Please explain or butt out of their lives - nobody wants to live in Soviet Europe again.