Apple Chastises Music Industry, Jumps in Bed With Hollywood

[Vincent Ferrari]

<p><img src="http://images.thoughtsmedia.com/resizer/thumbs/size/600/at/auto/1228064107.usr18053.jpg" border="1" /></p><p>Image credit: <a href="http://www.hdtvinfo.eu/news/hdtv-articles/hdcp-drm-on-new-macbooks-from-apple.html" target="_blank">HDTV Info Europe</a></p><p>One of the most popular and controversial things ever written by Steve Jobs was his <a href="http://www.apple.com/hotnews/thoughtsonmusic/" target="_blank">"Thoughts on Music"</a> letter shown to everyone and directed at the music industry. In it he laid out his vision for a DRM-free music marketplace and its implications for the industry and for consumers. Many took this as a signal that Jobs was about to move iTunes into a DRM free monster, but the record industry hasn't cooperated as planned, and despite the bravado of Jobs, he has continued to allow their music to stay in the store whether it's DRM free or and now we're finding out that Apple has gotten even further into bed with the entertainment industry, but instead of the music industry, it's Hollywood.<MORE /></p><p>Recently many customers who happily purchased Apple's latest line of notebook computers are finding out that Apple is just as in bed with entertainment as they've ever been. Customers who purchased iTunes movies in High Def were treated to error messages when plugging their new shiny laptops into displays that didn't support DPCP (DisplayPort Copy Protection). The outrage over this has been going on for a few days. Earlier this week Apple issued a patch for QuickTime that would stop the grief for standard definition movies, but offered nothing in the way of relief for High Def purchases and rentals.</p><p>The obvious question is why?</p><p><img src="http://images.thoughtsmedia.com/resizer/thumbs/size/600/at/auto/1228137362.usr18053.jpg" /></p><p>I'm not asking that in a legal or philosophical way, but more a common sense way. Assuming I bought or rent a movie on my new MacBook Pro, what difference should it make if I watch the movies on the built-in screen or the externally attached one? Aside from the utter paranoia that someone will somehow start pilfering movies utilizing the analog hole, there's no logical reason for this except for the fact that Hollywood straddled Apple with this copy protection as a condition of having high def content on the iTunes Store. This is where Steve Jobs and Apple have utterly failed. Steve Jobs has consistently said (keyword = said) that he's against DRM on music but he's made no such demands of Hollywood, an industry he has a vested interest in as the largest shareholder in Disney. Instead of doing what's right for the customer, Apple has taken a stance that's arguably diamtercially opposed to the customer's best interests.</p><p>I'm willing to accept that DRM on movies is a necessary evil. Frankly, if it's not terribly restrictive, I can accept reasonable copy protection on digital downloads. Does it make me happy? Nope, but I'm willing to accept reasonable DRM as a cost of doing business (in a manner of speaking). When you take into account what is going on with Apple's notebook line, a line is crossed between being necessary and unintrusive and being punitive to those who purchase content.</p><p><PAGE /></p><p>I should note that, in reality, none of this even affects me. I have an AppleTV hooked up to my 40" Samsung LCD TV through HDMI. I never hook an external monitor up to my MacBook Pro to watch any kind of content, and I'm certainly not going to lose any sleep over whether or not my notebook will bark at me when I hook it up to my TV. But that's me. I also find it perfectly reasonable for someone who doesn't have an AppleTV to want to hook their laptop up to their television and watch a movie, and if they own it and the computer they bought it on is present with the movie already loaded on the hard drive, why shouldn't they be able to view it on the screen they choose?</p><p><img src="http://images.thoughtsmedia.com/resizer/thumbs/size/600/at/auto/1228137735.usr18053.jpg" /></p><p>In essence, this would be the same as Steve Jobs saying to Apple customers that since the iPod Touch has a set of speakers, you're only allowed to listen to music on the headphones but all other sounds can be played on the speakers. If you think that sounds ridiculous, think about it in reverse with movies; Apple's essentially doing the same thing.</p><p>I'm a fan of Apple, but that doesn't make everything they do right, and this smacks of being completely and wholeheartedly wrong. For all the bluster about Apple and how they stand up for their customers, they let their customers' best interests take a back seat in this case and that, as far as I'm concerned, is unforgiveable.</p><p><em>Vincent Ferrari is an Apple fan, videoblogger, blogger, writer, and all-around geek from the Bronx. He works in the IT Department of a cellular phone company that shall not be named, and lives in a very comfortable apartment with his lovely wife, two lovely cats, three Macs, two iPhones, and God-knows-how-many iPods of varying age.</em></p><p>&nbsp;</p>

[doogald]

If they only way to get hi-def movies in iTunes is to protect against the analog hole, would you continue to be against it? If a majority of customers were willing to put up with the video out copy protection, shouldn't Apple give them what they want - a chance to buy hi-def movies? If I'm not mistaken, you can still buy the standard def if you are so against the protection and wish to make a statement.

[Vincent Ferrari]

If they only way to get hi-def movies in iTunes is to protect against the analog hole, would you continue to be against it? If a majority of customers were willing to put up with the video out copy protection, shouldn't Apple give them what they want - a chance to buy hi-def movies? If I'm not mistaken, you can still buy the standard def if you are so against the protection and wish to make a statement.

As I said, this isn't about me. They can layer on copy protection like this all day long and it still won't affect me in any way because I don't watch iTunes content (except for podcasts) on my MBP; that's reserved for my AppleTV and HDCP compliant TV. I just think that this type of nitpicky DRM is very counter to what Steve Jobs claims he wants from the music industry which is no DRM at all.

It's not the end of the world, and most people probably don't care about it, but that doesn't make it correct or even less hypocritical.

[doogald]

In case I was being too obtuse, my point is that if that the only way the movie industry will allow Apple to sell HD movies to iTunes and AppleTV customers is with analog hole protection, Apple has little choice. Their Apple TV and iTunes customers want HD content. And while Steve Jobs may be the largest shareholder in Disney, he is not a majority shareholder, and even if he was, the company directors have an obligation to act in the best interests of all of the shareholders. The SEC has been all over Apple for backdating options (for good reason); do you not think that they would do otherwise if Disney broke from the industry and removed DRM protection for the benefit of the company run by their largest shareholder and company director, especially if Disney shareholders brought a lawsuit against the company for not protecting their IP with DRM, as their competitors do?

Now, I have no idea if this is the case - that Apple is prohibited from selling HD content without video out copy protection - but my guess is that this is the case. And I think that because Steve Jobs is a director at both Disney and Apple that it would take another studio to act before Disney could. Even if he resigned his board seat at Disney, it could be seen as inside dealing for the benefit of a former director and large shareholder. That would be a risky move for Disney to take by themselves.

[Vincent Ferrari]

In case I was being too obtuse, my point is that if that the only way the movie industry will allow Apple to sell HD movies to iTunes and AppleTV customers is with analog hole protection, Apple has little choice. Their Apple TV and iTunes customers want HD content.

I don't doubt that it is a requirement and they're doing it just so they can have HD content, but that doesn't make the position itself less hypocritical. He went after the music industry and took a back seat to the movie industry. That seems like, at minimum, a double standard for both.

The SEC has been all over Apple for backdating options (for good reason); do you not think that they would do otherwise if Disney broke from the industry and removed DRM protection for the benefit of the company run by their largest shareholder and company director, especially if Disney shareholders brought a lawsuit against the company for not protecting their IP with DRM, as their competitors do?

That's a good question, but who says it has to be Disney, if it all? I'm talking about the industry in general. When the Copyright Royalty Board talked about raising royalties for downloaded music, Jobs was ready to close the iTunes Store altogether. I just think that it's odd that he's not taking an equally hard line with Hollywood.

Now, I have no idea if this is the case - that Apple is prohibited from selling HD content without video out copy protection - but my guess is that this is the case. And I think that because Steve Jobs is a director at both Disney and Apple that it would take another studio to act before Disney could. Even if he resigned his board seat at Disney, it could be seen as inside dealing for the benefit of a former director and large shareholder. That would be a risky move for Disney to take by themselves.

I agree, but again, it doesn't have to be Disney. There are a lot of movie studious out there that aren't Disney that he could lean on. The fact that he isn't is what's rubbing me the wrong way.

[doogald]

There are a lot of movie studious out there that aren't Disney that he could lean on. The fact that he isn't is what's rubbing me the wrong way.

Neither of us know whether he is leaning on them or not. It is possible that he is and is not talking about it. Did you have any idea that Apple was about to announce that NBC was coming back to the iTunes Store this past September? With all of the speculation going into that presentation, nobody predicted that was going to happen. Steve is pretty good about keeping his strategy and tactics secret.

[Vincent Ferrari]

Steve is pretty good about keeping his strategy and tactics secret.

Except when he releases "Thoughts on Music" or has his PR Department scold the industry. Honestly, he's secretive when it suits him.

Understand, I'm not saying I know the right answer or what's going on behind the scenes, but his public castigation of the music industry doesn't seem to be equalled in his submission to Hollywood. That really was my only point.