EU Probe into iTunes: Separating Fact from Hysteria
The EU is investigating the actions of Apple and 4Major Record labels with regard to their practices in selling music online through iTunes. The BBC nicely sums up the gist of the case with the following:
“The EU has launched a probe into what Apple’s online music store iTunes charges users across Europe, accusing it of restricting customer choice.
Brussels believes agreements between Apple and record companies violate EU laws by preventing users in one country buying music from a site elsewhere”
Unfortunately, that hasn’t stopped some people from misrepresenting what this case is all about. For those people that don’t live in the EU, one of the grounding principles on which the European Union was create was to form “a single market where goods, people, money and services can move around freely”.
With the iTunes store in Europe they restrict the sale of purchases based on your credit card address, so for example, I live in Ireland, and I can only purchase tracks in the Irish store.This flies in the face of the EU principles of free trade. However, it is users in Britain who are most affected by this, as Apple charges 79p per track in the UK, which given exchange rates is €1.69, but in the Euro Zone stores, the price per track is only €.99. This seems to be where much of the confusion about the EU probe is stemming from.
The issue is NOT that Apple are charging more in the UK (as some seem to be reporting), but the fact that Apple are preventing UK customers from purchasing tracks in any of the other stores. This completely and utterly contradicts not just EU law but the whole point on which the EU was founded. It is nothing to do with DRM, and it is nothing to do with currency exchange rates. It is also important to note that Apple are not the only ones facing this probe. The European Commission is also targeting the Record Labels too. It is likely that the labels are using Licensing as an excuse to push these restrictions on Apple, but considering that I can purchase CDs through Amazon France or Amazon Germany, this excuse seems to have little legal weight. Some people have claimed that this is the EU being heavy handed and anti business, but the EU has every right to enforce its own laws especially ones as fundamental as this one is. And for those who argue that the Commission has waited until iTunes was successful to pursue them, this procedure was started in 2005.
Look at it another way. Imagine if in the US Apple restricted the sale of content from the iTunes store to individual states, so you could only purchase music from the state you were a resident in, then on top of that they would vary the pricing from state to state, so if you lived in Maine, for example, you had to pay ¢99 but in Washington you had to pay $1.20. I imagine the vast majority of people would be pissed.
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Thanks for spelling this out so clearly. Did Ireland convert to the Euro? I understand (almost) why Britain would have its own store since they still use Pound/Pence but why would there not be a single Euro store? Wasn’t there another EU country that held out against the Euro?
john
Ireland is a member of the Euro Zone. We switched over with the first group of people. It was the usual panic before the switch but within a few months no one cared any more. It was very painless. Most online stores in Europe either sell in euros or allow you to select euro or pounds if they sell from the UK. Im not sure which other countries didn’t join the euro.
If I lived in England I would be outraged that everything has a higher price there. For instance, Japanese Sony cameras can be purchased in the USA for one-half the price charged in GB. This is the same camera, both made in Japan (or China). I have noticed that UK retailers either do not have enough competition or they just want more markup for their goods. I am sure that the pricing of music through iTunes in GB has nothing to do with a decision made at Apple. Look to your local distribution model for the reason.