Apple’s big meeting with the Commission cut short

Lawyers for Apple met with the European Commission’s Competition Directorate to explain pricing. Most MBA’s spend their entire careers trying to figure out European pricing, between the laws and the cartels. A significant part of music industry – one of the most powerful cartels – decided not to attend. The two day hearings were cut to one.

Apple and the music industry big four were invited to Brussels this week to answer the lingering complaint about different prices for music downloading through the iTunes music store across the 27 EU Member States. Sony and Universal representatives attended. Sony and Warner Music did not, saying they felt the Commission had been “persuaded.”

Under Article 18 of the EC Treaty, pricing must not vary across the EU Member States. An iTunes download in the UK costs slightly more than in the rest of the EU. Apple blames the disparity in VAT taxes, not to forget rights fees. Also don’t forget individual States’ banking laws governing credit card rates. European banks are another cartel the EC hesitates taking on. Apple must negotiate taxes, rates and royalties country by country.

Apple, according to a Reuters account of the meeting, said “doing business in Europe is more complex than in the United States.

This weeks hearing was not about the interoperability issue – iTunes accessible only through iPod, similar to the now all but closed Microsoft case. The Commission, contrary to popular whinging by several national governments, is highly unlikely to find the iTunes/Ipod match up a ‘lock-up’ Consumers have many choices, perhaps not as sexy.

Apple has a 70% market share of music downloads, whinged Microsoft attorneys the day after their slap-down from EC Competition Commissioner Neeley Kroes. She’s been on something of a roll this week. A day after Microsoft was punished, Europe’s anti-trust authority issued rules on the energy sector, effectively preventing Russia’s Gazprom from expanding into pipeline ownership in the EU. This could prove interesting with the heating season fast approaching and a history of energy disruption along pipelines passing through Belarus and Ukraine…to several EU Member States.

All of the information from Wednesday’s meeting will be passed to Commissioner Kroes for a ruling. If she so desires Apple can be fined as much as 10% of its yearly gross revenue. Imagine getting that amount of money from Gazprom. The EC could make all music free. - September 20 , 2007

Keywords:European Commission, Apple

Europe’s Media Rules – From Television Without Frontiers to the Future

The Television Without Frontiers Directive is all but a memory, soon to be replaced by the Audiovisual Media Services Directive. This ftm Knowledge file details the issues, the debates and the outcome. Also included are articles on competition, product placement and cinema. 51 pages PDF (June 2007)

Free to ftm Members, others from €39

Media Measurement Moves Forward and Everywhere

Includes: mobile and internet metrics, electronic measurement systems and device descriptions, RAJAR (UK) debate, with comments. 57 pages PDF (May 2007)
Free to ftm members, others from €39
Order

Further Complicated: Advertising, Children and Television

Advertising and television face more complaints, criticism and new rules. ftm reports on the debate in Europe and North America 43 pages PDF file (March 2007)

Free to ftm members and others from €39

Order

The State of the Print Media in the World

ftm reports from the World Association of Newspapers Congresses. Includes WAN readership studies, Russian media and Russian politics, press freedom and the state of journalism. 62 pages. PDF file (October 2006)

Free to ftm members and others from €39

Order

French National Newspapers
publishers, designs, editors all change, with comments. 40 pages PDF (updated July 2006)

Free to ftm members, others from €39
Order