Saturday 22 September 2007

Microsoft's Monopoly vs Apple's 'Monopoly'

There's been some talk in the media that since the EU has sought to tackle Microsoft's abuse of market dominance on the Desktop Operating System market, Apple should be next for its dominance in mobile digital music.

This, in my opinion, is crazy and this is why; Choice. Apple's so-called monopoly has been achieved through the choice of people wanting its products. Microsoft's monopoly has been achieved through people having to use their products where no choice was offered.

Let me put this another way, if you were to walk into a high street electronic store or a computer store with a view to purchasing a digital music player, you would find choice. Lots of choice. There'd be so many different makes and models of digital music player from which to choose that your head would spin. You'll find music players by Fujitsu, Sanio and Sony (to name but a few). There'd be a bunch of cheaper ones with a brand you've never heard of before. You'll find players that can handle video made by Creative and yes, you'll find media players by Apple. What you'll see is that you have choice, you can choose which player you want and guess what, they will all play MP3 files.

But what if you were looking to buy a computer? Granted, you could walk into a store and find computers made by HP, Lenovo and Sony and many more. Is that choice? Kind of. But what about the Operating System? Sure, you can choose between Windows Vista Home Basic, Windows Vista Home Premium, Windows Vista Enterprise and so on, but the bottom line is this, you will be buying a Microsoft operating system. Sure, if you ask around and make the effort, you can get yourself a Linux box and maybe even a Mac, but let's look at the shop window; All you can have is Windows.

Whereas you can choose your music player, you can't choose your Desktop Operating System. And this is the difference between Microsoft's monopoly and Apple's 'monopoly'.

But how did we get here?

Microsoft got here by illegal means. They bullied companies into not including other Operating Systems on their computers thus making sure that the only Operating System that could breathe was Windows. Anything else suffocated through lack of exposure. Ever heard of BeOS? There we go then. Windows succeeded by becoming the default installation on almost every computer sold. Not many people actually choose Microsoft Windows because, as far as they can see, Microsoft Windows is all there is.

How did the iPod become so dominant? Apple released it, marketed it and people chose it. It's that simple. Apple didn't have to stop others from making music players and it didn't have to stop shops from selling them. In other words, Apple made a media player that people wanted more than the others, hence their market lead. If Apple were to start making media players that people didn't like, people could move on and buy something else instead. Apple doesn't own the market through bribery and corruption, it owns that market by appealing to the materialistic values promoted in today's modern media - in other words, Apple owns the market because it makes things that people want.

But the EU is worried because Apple is locking people into the iPod. They say that there's no means for people who use iTunes to use their music with other devices. That's not strictly true. I play my iTunes music on my Nokia smartphones by burning the music to a CD ROM and ripping it back in MP3 or unprotected AAC. It's my music, I listen to it on my phone and my iPod. What's the EU talking about?

I really don't see what there is to investigate regarding Apple and it's alleged monopoly. Nobody forced me to buy an iPod, I could have just as easily bought a Windows Media Compatible player (that would be compatible with Windows Media, for a while, before Microsoft changed the format without giving me a path to upgrade for free - a la Plays For Sure), but I wanted an iPod.

Yes, Apple has a massive chunk of the mobile digital media market. Ok, it's a hugely massive chunk and it is the biggest fish in the pond, but it got there by the market (that's us) choosing to put it there, not because people were forced or tricked into buying Apple products.

How much of a stranglehold does Apple have in order to force the market to do what it wants? Ask NBC who have decided on their own volition to not work with Apple and instead work with Amazon. Nobody stopped them and people are as free to buy NBC products from Amazon as they were when NBC were in iTunes.... Well, except that NBC video will no longer play on Apple Macs because Microsoft doesn't support protected Windows Media on the Mac..... Wait a minute!

So, EU dudes, before you complain about Apple's media monopoly, take a look at the BBC's iPlayer, ITV.COM, Amazon's video service, Channel 4's 4oD and tell me where you see Apple's monopoly. Then pop down Currys or Dixons and count how many music players support protected WMV and WMA compared to protected AAC. If there is a lockout monopoly going on, you want to be knocking on doors in Redmond, not Cupertino.

1 comment:

Shawn Oster said...

One of the ways we "got here" was due to the fact that Apple decided to maintain as much control over their product as possible, hence the walled garden approach of development. While this keeps quality and the "just works" factor high it greatly increases the barrier to entry. Many corporations picked PC's because there were more than one hardware vendor to choose from which in turn means a great selection of price points to pick from. When you're buying a 1000 units the difference between a $500 machine and a $1000 (at the time) is huge. This in turn trickles down to people purchasing products they are familiar with, Windows.

I take issue with your desire for more choices in the OS market. Choices of an OS means a less choices in the applications that run on them. While I agree there should be a wide range of choices when purchasing a DVD player I want them all to be able to play the same DVD's. It's already a pain in the arse having to deal with three major OS's as a software developer. Same thing with cell phones, it's a pain that there is a different standard in Europe than in the States. From that regard I greatly appreciate there being so little OS choice. Personally I wish either Linux, OS X or Windows would just claim victory and all the other ones would disappear so you don't have to pick your OS based on the applications you wish to use. It's also painful as a small software developer because I have to pick one OS over the other since I don't have the resources to develop on both. I can use some of the cross-platform tools but then you end up with applications that don't look good on either OS.

The EU's court ruling actually nothing to do with a 'monopoly' per say, they don't have the same monopolistic rules as the U.S. does. Their entire argument is based around the concept of market dominance, not monopoly which in turn means that regardless of whether Apple is dominating the market via people's choice or business deals it's still a dominant force. This is where the media sees impending issues with the EU and CFI's ruling, because as you rightly point out there are differences between how companies achieve dominance in the market yet the ruling doesn't take that into account. They very well could say that since Apple is dominant it needs to allow other third-parties access to it's iTunes software and catalog and to relax it's licensing of protected AAC.

Your "solution" of burning to CD then re-ripping is a hack, pure and simple. It wastes time and money and is anti-consumer. You're paying full price for less convince than a physical CD. Apple's defense that distributing unprotected AAC would lead to more piracy is just as ridiculous as Microsoft saying that sharing it's server protocols will lead to market disruption. It's just bad scare tactics. Also, while burning/re-ripping is fine for nerds like us my wife doesn't have the time to waste in doing that process and finds the whole thing amazingly unfriendly and far from "it just works".

I'm not sure I understand your last paragraph about comparing the number of players supporting protected WMA (aka PlaysForSure) vs. those that support protected AAC (aka FairPlay). As far as I know there is exactly 1 DAP that supports FairPlay and that would be iPod and it's various forms yet quite a few devices support PlaysForSure. This would say to me that Microsoft has been very generous in it's licensing while Apple has been quite stingy, instead wanting to maintain a market lock by anyone wanting access to the iTunes catalog. Perhaps I got your point wrong though.

All of this being said I don't think the Apple 'monopoly' lies in the iPod, it lies in the tying of iTunes to the iPod. I want a wide range of choices of online music stores and a wide range of digital media players and I do not want them tied to each other. I should be able to purchase tracks from the Zune Marketplace and use them on an iPod and I should be able to buy video on iTunes and watch it on my XBox 360, all without having to use time-wasting hacks.