Apple Having a Rough Time

On Wednesday Sept. 5 2007, Apple made two major announcements: A new iPod line and a $200 price reduction on its 8GB iPhone (the 4GB is being phased out). The former was overshadowed by the latter. Apple received “tons” of negative feedback from its customers who had bought the iPhone at the original price of $599 just two months ago when it was first introduced.

At first Steve Jobs, Apple’s CEO, attempted to shrug off the criticism saying: “If they bought it a month ago, well, that’s what happens in technology.” But for those who had just bought the phone that same day: “they should go back to where they bought it and talk to them.” However after the griping continued Jobs apparently had a change of heart. The company is making the right decision by lowering the iPhone price, he said, but needs to “do the right thing for our valued iPhone customers.” He issued a statement on the company’s website in an attempt to appease the iPhone faithful.

• First, I am sure that we are making the correct decision to lower the price of the 8GB iPhone from $599 to $399, and that now is the right time to do it. iPhone is a breakthrough product, and we have the chance to ‘go for it’ this holiday season.

 

• Second, being in technology for 30+ years I can attest to the fact that the technology road is bumpy. There is always change and improvement, and there is always someone who bought a product before a particular cutoff date and misses the new price or the new operating system or the new whatever.

 

• Third, even though we are making the right decision to lower the price of iPhone, and even though the technology road is bumpy, we need to do a better job taking care of our early iPhone customers as we aggressively go after new ones with a lower price. Our early customers trusted us, and we must live up to that trust with our actions in moments like these.

He then offered $100 store credit to those who had purchased the iPhone at the original price and were not eligible for any other discounts or rebates. Under Apple’s refund policy, customers who bought an iPhone within 14 days of the price cut can get a refund of the price difference if they have the original receipt. Those who haven’t opened the phones can return them for a full refund.

“We want to do the right thing for our valued iPhone customers. We apologize for disappointing some of you, and we are doing our best to live up to your high expectations of Apple.”

Investors were also rattled by the news, sending Apple’s shares down a total of more than 6 percent over the past two days, a drop that has wiped out about $8 billion in shareholder wealth. Apple’s stock closed Thursday at $135.01.

Now for the Good News:

The new iPOD touch, it comes in two sizes 8GB ($299) and 16GB ($399) and has the look and feel of the iPhone with some new features.

• Multi-touch interface

  iPod touch features the same multi-touch screen technology as iPhone. Pinch to zoom in on a photo. Scroll through your songs and videos with a flick. Flip through your library by album artwork with Cover Flow.

• Wi-Fi (802.11b/g)

  Browse the web using Safari and watch YouTube videos on the first iPod with Wi-Fi built in. Shop the iTunes Wi-Fi Music Store from anywhere. Browse or search to find the music you’re looking for, preview it, and buy it with just a tap.

• 3.5-inch widescreen display

  Watch your movies, TV shows, and photos come alive with bright, vivid color on the 320-by-480-pixel display.

This one looks like it might make a great Christmas present! In fact that seems to be Apple’s strategy with announcing the new iPod and lowering the price of its iPhone. It is gearing up for the holiday season. Anybody interested??

 

Is the Party over for Apple?

Recently NBC announced that it would not be renewing its contract with Apple to sell its video content through the iTunes music store. In a move that has surprised industry watchers, NBC has chosen to use Amazon’s Unbox service as an outlet for some of its most popular shows. The Office, Heroes and 30 Rock will all be migrating from iTunes to Amazon’s digital video download service on TiVo. These shows will be available for download on Unbox the day after they are shown on the network.

Amazon hopes NBC Universal’s inventory will give Unbox a much-needed boost. Unveiled in September 2006, the service is a distant competitor to iTunes and has suffered from scattered service problems, including lengthy waits for downloads. While Amazon has solved many of the problems, Unbox is still limited in one important aspect: It is not compatible with Apple’s iPods, which are by far the most popular portable video players.

NBC had been trying unsuccessfully to negotiate a new pricing structure with Apple before announcing that it would not renew its contract. Apple sells episodes of television shows for a flat $1.99, with movies priced at $9.99. While the prices on Amazon will remain the same for per episode downloads ($1.99), NBC plans to offer “deals” on bundled content for as yet unannounced prices. Taking an obvious swipe at Apple, NBC praised Amazon on the new deal:

“Amazon is a company that understands the value we provide as content owners to its business,” said Jean-Briac Perrette, president of NBC Universal Digital Distribution.

In addition to new episodes of returning series, NBC Universal said it would allow Unbox customers to download free — in advance of their network premieres — the pilot episodes of new series, including a “Bionic Woman” remake and “Journeyman,” about a man who travels through time to help people in trouble.

“We are excited to bring NBC Universal shows like the award-winning The Office, 30 Rock and Battlestar Galactica to our Amazon Unbox customers,” said Bill Carr, Amazon.com Vice President for Digital Music and Video.

NBC video programming had accounted for 40% of Apple’s iTunes offerings. It is not yet clear whether the move by NBC will result in iPod users moving to Amazon’s Unbox and following the “content” or NBC will simply be depriving itself of the vast audience (and revenue) of the iTunes faithful. In a statement about the controversy with Apple, NBC issued a statement which in part accused Apple of a strategy designed to boost iPod sales.

“It is clear that Apple’s retail pricing strategy for its iTunes service is designed to drive sales of Apple devices, at the expense of those who create the content that make these devices worth buying.”

Whatever happens, one thing is obvious, Apple is losing its ability to get companies to go along with its pricing strategy. If NBC is willing to jump ship, will any of the others follow? Is the era of iTunes dominance coming to an end?

 

iTunes Under Pressure

Apple’s iTunes is the undisputed leader in downloaded digital music with a whopping 76% market share. It is also #3 in overall music sales behind Walmart and Best Buy, having recently surpassed Amazon.com. It has sold more than 100 million iPods, which is the only device that works with iTunes, and has refused to allow other music players access to the iTunes music library. No other company has more influence over the delivery of digital music than Apple.

In order to sell music Apple has contracts with all the major music companies like Universal, Sony, Warner and EMI. Because of its dominance Apple has been able to make deals with these companies setting the price of digital downloads at 99 cents per copy. Many of its suppliers would like to see a flexible price structure that charges more for new releases and less for older songs. Apple has resisted this, claiming more complex pricing would discourage customers from purchasing music online and increase the temptation to look for free pirated (illegal) music. Now as some of these contracts come up for renewal there seems to be a reluctance to just do as Apple says.

Universal, the world’s biggest music corporation, has announced that it will not renew its contract with Apple to sell its music through the iTunes music store. Instead, Universal said that it would market music to Apple at will, a move that could allow Universal to remove its songs from the iTunes service on short notice if the two sides do not agree on pricing or other terms in the future. This may just be posturing by Universal in an attempt to pressure Apple into making concessions or Universal may decide to look elsewhere to distribute its music. Apple however does have a deal with EMI to sell music without copy protection for a slightly higher price of $1.29.

Apple not only sells music online but it has a significant offering of video content as well. In a move that seemed to echo the actions of Universal, NBC also announced that it too will not be renewing its contract with Apple. NBC is the biggest provider of digital video content on iTunes, accounting for about 40% of all downloads. It offers popular shows like Battlestar Galactica, The Office and Heroes. In all, NBC offers some 1,500 hours of news, sports and entertainment programming and earns about $200 million a year from digital downloads through iTunes. Without a new contract Apple will no longer be providing these programs after the end of the year. As with its digital music Apple offers a simple pricing structure for video content. Episodes of television shows sell for $1.99, with movies priced at $9.99. NBC, like Universal, would also like to move to variable pricing which Apple has resisted.

In a move seen as challenging iTunes dominance, Universal has recently announced that it will sell online music without copy protection through existing digital music retail services like RealNetworks and Wal-Mart, nascent services from Amazon.com and Google, but not through iTunes. NBC has also announced Hulu.com, a venture in partnership with the News Corporation to build a video portal to compete with YouTube and presumably iTunes as well.

The big question is whether iTunes’ virtual monopoly on digital downloads can be broken. It certainly seems improbable that Apple’s current dominance in the market, through its sales of iPods, can be sustained over time. Apple is not a content provider, it only provides a medium for companies like Universal and NBC to sell its products. If the providers choose to leave Apple and provide their content elsewhere, where does that leave Apple? So far the contracts with Apple have been financially rewarding but as new technologies emerge and new alliances are formed, there is no guarantee that the status quo will be maintained.

 

Fingerprints can reveal Sex, Race and Lifestyle

The majority of us have been fingerprinted at some point in time. It is the definitive way of proving who you are. Law enforcement makes extensive use of fingerprints in the criminal justice system, whether to identify convicts or to determine who has committed a crime. They are also required for security clearance and official documents. However until now they have only been used in a comparative sense. Your fingerprints are compared to a copy in some database. If they match then your identity is confirmed.

Fingerprints involve three distinct features: arches, loops and whorls. They are formed in a developing fetus from about the 17th week of pregnancy and remain consistent from that time on. Scientists are still not sure how they are formed. For more information on the developmental process click here.

Fingerprints have never been used to determine any other characteristics like age, sex or race……until now. Scientists have shown that using a gelatine-based gel and high-tech chemical analysis can provide significant clues to a person’s identity even if police do not hold existing fingerprint records. The new method can detect tiny traces of substances such as gunpowder, drugs, or biological or chemical weapons. It may also determine the time (accurate to within one hour) a set of fingerprints were left at a crime scene.

Prof Sergei Kazarian, from Imperial College London’s Department of Chemical Engineering, led the team that developed the new technique. The findings are detailed in the Aug. 1 issue of the journal Analytical Chemistry. Read the article here Spectroscopic Imaging of Latent Fingermarks

The gel tape can gather prints from a variety of surfaces, including door handles, mug handles, curved glass and computer screens, just as conventional fingerprint techniques can. The gelatin is then irradiated with infrared rays inside a highly sensitive instrument that rapidly takes a kind of “chemical photograph,” identifying molecules within the print in 30 seconds or less, said physical chemist Sergei Kazarian

Fingerprints contain just a few millionths of a gram of fluid, or roughly the same amount of material in a grain of sand. That might, however, be enough to determine valuable clues about a person beyond the print itself, such as their gender, race, diet and lifestyle, Kazarian and his colleagues find.

Strong traces of urea, a chemical found in urine, suggested a man left the print. Lower levels of the chemical made it more likely to be from a women.

Specific amino acids indicated whether the “suspect” was a vegetarian or meat-eater, and different fatty acid profiles suggested provided clues to their racial origins.

By focusing on what is left in a fingerprint after periods of time, scientists could potentially gauge how old a crime scene is.

The use of this new technique could also minimize false positives in identifying fingerprint owners. One such example of false positives happened to Brandon Mayfield, who in 2004, who was falsely accused of being involved in the Madrid train bombings. FBI investigators matched prints at the scene to Mayfield, and an independent examiner verified the match. But Spanish National Police examiners insisted the prints did not match Mayfield and eventually identified another man who matched the prints. The FBI acknowledged the error and Mayfield was released. Studies have shown an error rate of 0.8 percent in matching prints. Multiplied across all cases processed by U.S. crime labs in 2002, that would be 1,900 mistaken fingerprint matches. For more details click here

 

 

Perception in Advertising

Does this picture have racist connotations, is it an example of subtle racism or is there simply nothing wrong with it? It is an advertisement for the new Intel “Core 2 Duo” processor, which is supposed to be faster and better than anything else on the market……..“40% more performance with improved energy efficiency” and “delivers unparalleled multi-tasking capabilities”. The powerful new chip is exemplified by the “cloned athlete ready to go” at a moment’s notice, only waiting for the command to start running. The symbolism is in fact quite appealing and conjures up images of athletic strength, speed and ability. The new chip is ready and willing to take on the competition …..and win!! Great ad and compelling imagery…….Right !?!

Not so fast………..The athlete is black, in a kneeling position, with his head down while the “commander” is white and apparently in control, ready to give the orders. Is there a deeper meaning behind this depiction, attempting to perpetuate old stereotypes of a bygone era? Does the mere mention of a possible racist connection before viewing the picture, color the perception of the beholder? In other words if there was no mention of racism would this picture be OK? Some may see nothing wrong in this ad while others would be ready to protest to Intel about their insensitivity to matters of race. What do you think?

Often our perception of the world and the things around us are influenced by how other people perceive things. We often take our cues on how to think, behave and react from observing the actions and attitudes of our peers, the people we look up to, and the so-called experts. We tend to try to see things the way they do. That is why it is so important when using advertising to promote a product, that the wrong or unintended impression is not portrayed. It would be interesting to take a poll of you, the readers of this article.

Did the words here in any way influence your perception of this ad? or did you hold to your original impression, regardless of what was written?

 

 

Privacy International Blasts Google

 

Google has received Privacy International’s worst privacy rating. According to PI, Google is accused of “comprehensive consumer surveillance and entrenched hostility to privacy.” Google ranked the lowest among 22 other high profile Internet companies that include: Microsoft, Yahoo!, AOL, Wikipedia, The BBC and others.

Privacy International (PI) is a human rights group formed in 1990 as a watchdog on surveillance and privacy invasions by governments and corporations. PI is based in London, England, and has an office in Washington, D.C. PI has conducted campaigns and research throughout the world on issues ranging from wiretapping and national security, to ID cards, video surveillance, data matching, medical privacy, and freedom of information and expression. In a statement PI said:

While a number of other Internet companies have troubling policies, none comes as close to Google to “achieving status as an endemic threat to privacy”

To see the report in its entirety click here.

To see how each company was ranked click here.

The categories used for analysis included: Corporate administrative details, Corporate leadership, Data collection and processing, Data retention, Openness and Transparency, Responsiveness, Ethical compass, Customer and User control, Fair gateways and authentication, Privacy enhancing innovations and Privacy invasive innovations.

Google of course took issue with the report and defended its record saying that it aggressively defends its users’ privacy and stands behind its track record. It was last year that Google successfully fought a subpoena from the Department of Justice trying to review millions of search requests. Other search engines like Yahoo! and AOL handed their records over to the Government but Google refused, took the DOJ to court, and won.

“We are disappointed with Privacy International’s report, which is based on numerous inaccuracies and misunderstandings about our services,” said Nicole Wong, Google’s deputy general counsel.

“It’s a shame that Privacy International decided to publish its report before we had an opportunity to discuss our privacy practices with them.”

PI claimed they contacted Google before publishing their report but did not receive a response from the company. This is not the first time that PI has tackled Google over privacy issues. In 2004 they filed complaints in 16 different countries against Google’s Gmail service claiming among other things:

• Inadequacy, unfairness and lack of safeguards or redress in the Gmail Terms of Use.
• An absence of contractual commitment to the security of data.
• Breaches of law concerning the interception and scanning of emails

Prior to issuing the current report there seemed to be some “cloak and dagger” activity going on behind the scenes. Google had apparently tried to show that there was bias towards Microsoft, and presumably against Google, at Privacy International which prompted PI to publish an open letter to Google denying this saying they were “a fiercely independent organization that has never shown fear nor favour.”

As stated in a previous article Is Google Big Brother? there are serious privacy concerns that need to be addressed by Google. The report by Privacy International highlights this. Google has detailed personal information on millions of people who use their various services. How is this data being used? Is it safe and secure? Who has access to it? If there are inaccuracies, how would I know? How long is it kept for? It is not comforting to learn that privacy is not a top priority at Google.

Another aspect to Google brought out in the report is that it tried to undermine the integrity of PI, claiming favoritism towards Microsoft. Instead of dealing with the facts in the report it tried to marginalize the source. Is this the kind of behavior that we can expect from a company whose motto is: Don’t Be Evil? Is this the way to deal with criticism? Have others been silenced? There is a saying: “Power corrupts…..” Let’s hope we are not at the stage that we have to start wondering: “What is Google up to?”

 

 

LOOK! NO WIRES!

Remember when the first remote controls came out for TV sets? They were wired remote controls. You had to connect them to your TV and somehow hide the wires so that no-one tripped over them. But they were great, they freed us from having to get up every time you wanted to change a channel. Next came infra-red remotes and this was just the best thing that ever happened to TV! Now we could really become couch potatoes! and no wires! The same thing happened with telephones. The first models were wired to a plug in the wall and you could only go so far while talking on the phone. Cordless phones set us free to roam the entire house and still talk. But it was the cellular phone that gave us real freedom. You could take it anywhere with you and still make and receive calls. The same thing happened with computers. WI-FI gave us the freedom to take our laptops with us everywhere.

The next revolution in wireless technology could be right in your own home. Scientists at Massachusetts Institute of Technology (MIT) have developed a way to wirelessly beam electricity through an entire house. No more plugs! In the first successful trial of its kind, the team was able to illuminate a 60-watt light bulb 7ft away.

The inspiration for this project came from the lead researcher, Dr Marin Soljacic, who after many nights of forgetting to charge his cell phone came up with the idea that it would be great if the phone would just charge itself. In order to make this happen it would be necessary to find a way to transmit electricity wirelessly. The end result of this “idea” was an invention the team called ‘WiTricity’, which involves filling a room with a ‘non-radiative’ electromagnetic field. Most objects in the room – such as people, desks and carpets – would be unaffected by the electromagnetic field. But any objects designed to resonate with the electromagnetic field would absorb the energy.

The scientists say the technique works only over distances of up to 9ft. However, they believe it could be used to charge up a battery within a few yards of the power source connected to a receiving coil. Placing one source in each room could provide enough power for an entire house. The receiver and transmitter would not have to be in view of each other.

Professor Peter Fisher, another of the researchers, said: “As long as the laptop is in a room equipped with a source of wireless power, it would charge automatically without having to be plugged in. In fact, it would not even need a battery to operate inside such a room.”

The researchers believe there is little to worry about on safety grounds, saying that magnetic fields interact weakly with living organisms and are unlikely to have any serious side effects.

 

 

Is Google Big Brother?

 

For a company that didn’t exist 10 years ago Google has come a long way. It is the most pervasive entity on the Internet. If you have ever used a computer, Google knows something about you. It has even coined a phrase that everyone understands: “To google”. If you want to find out something about a particular topic, all you have to do is google it, meaning of course to search for it online. Google is a search engine, Google provides a host of services including email, video sharing, book searching, mapping and many business and consumer tools but most importantly Google is an advertising company. Advertising is how Google makes its money. Google has perfected the art of delivering the right ads to the right people at the right time. That is the power of Google.

Birth of a Giant

Google was co-founded by Larry Page and Sergey Brin while they were students at Stanford University, and the company was first incorporated as a privately held company on September 7, 1998. Google’s initial public offering (IPO) took place on August 19, 2004, raising $1.67 billion, making it worth $23 billion. At that time each share was worth $85. Today each share is worth about $500. Both Larry Page and Sergey Brin are worth more than $16 billion each. On March 30, 2006, less than two years after its IPO Google was added to the S&P 500 index.

 

Growth by Acquisition

Google now employs more than 12,000 people with an annual revenue in 2006 of more than $10 billion. For more financial information and statistics click here. Since Sept 2001 it has acquired more than 40 companies, most of them for undisclosed sums. There are however some notable purchases on record.

• April 2003 – Applied Semantics – Advertising technology – $102 million
• Jan. 2006 – dMarc Broadcasting – Radio advertising – $102 million
• Nov. 2006 – uTube – Video sharing – $1.65 billion
• Dec. 2006 – Endoxon – Mapping technology – $28 million
• Feb 2007 – Adscape – Video game advertising – $23 million

The proposed purchase of DoubleClick an online advertising company for $3.1 billion has not yet been approved. The recent acquisition of FeedBurner for an estimated $100 million also puts Google in the RSS feed business.

Is Google Big Brother?

“Big Brother” — any omnipresent, seemingly benevolent figure representing oppressive control over individual(s) exerted by an authoritarian power……. from wikipedia

Google’s motto is “Don’t be Evil” but its ubiquitous presence on the Internet is near monopolistic and history has shown that monopolies, whether government-sponsored or private enterprise do not have a good track record. The fact of the matter is that we “trust” Google and Google knows an awful lot about us. It has just recently offered a new service that brings this into focus called “Web History”. Below is part of the promo for this new service.

Follow interesting trends in your web activity.

Which sites do you visit frequently? How many searches did you do between 10 a.m. and 2 p.m.? Web History can tell you about these and other interesting trends on your web activity. Want to learn more? Try the Web History Help page.

This proves, and Google readily admits, that your every search and web page visit has been recorded and stored on their system for future use. As of December 2006, Google is the most used search engine on the web with a 50.8% market share, ahead of Yahoo! (23.6%) and Windows Live Search (8.4%). Google indexes billions of Web pages, so that users can search for the information they desire, through the use of keywords and operators.

Although Google has a clearly defined privacy policy, have you ever read it? Do you know what kind of personal information is collected about you, how it is used and what your options are? Take a look at some of the highlights here. Some of it may surprise you.

 

 

DRM-Free Music comes to iTUNES

Apple has released a new version of iTunes (7.2), its popular online music store called iTunes Plus. The big news here is that the new version now sells DRM-Free music. DRM or Digital Rights Management (better known as copy protection) is the software that is embedded into downloaded music which restricts how and where the music can be played. For instance music previously purchased from the iTunes music store could only be played on an iPod or an authorized computer. It could not be played on any other music player and could not be transferred to your friend’s computer or a file sharing service because it would have to be “authorized” by you each time to be played. Apple has now removed this copy protection from a limited number of songs, those sold by the EMI group, and has urged others to follow suit. See the Apple announcement for complete details.

The new DRM-Free music vs the old DRM music:

• Will cost more – $1.29 vs $0.99
• Will be higher quality – 256 kbps vs 126 kbps
• Will be upgradeable for $0.30 each or $3.00 per album from the old music

iTunes Plus is launching with EMI’s digital catalog of outstanding recordings, including singles and albums from Coldplay, The Rolling Stones, Norah Jones, Frank Sinatra, Joss Stone, Pink Floyd, John Coltrane and more than a dozen of Paul McCartney’s classic albums available on iTunes for the first time. London-based EMI, is the world’s third-largest music company by sales. Barney Wragg, the global head of digital music at EMI, said the iTunes Plus launch capped six months of work to convert most all of the company’s digital catalog into a DRM-free format.

“Our customers told us two things deterred them from buying digital,” Wragg said. “They weren’t 100 percent confident that the songs they’d purchase could play on their devices, and they wanted something closer to CD quality.”

 

“We definitely think it’s the right thing to do,” Eddy Cue, Apple’s vice president of iTunes, said. “In this case, EMI’s a leader and we think others will follow.”

Before you get too happy about the possibilities this new DRM-Free music is not a license to spread unlimited copies of your music all over the place. Apple will embedded inside each music file your full name and e-mail account. This information will be included in any copies made, allowing for a trail back to the original owner.

Earlier this year, Apple CEO Steve Jobs called on the world’s four major record companies to start selling songs online without copy-protection software. He expects that more than half of the 5 million tunes sold by Apple will be DRM-Free by the end of the year.

One minor drawback is that the music sold on iTunes is in the AAC format which some players don’t recognize, this would mean that some users may have to convert their music to the MP3 format which is universally accepted.

 

 

Apple Wants DRM-Free Music

In a surprising move Steve Jobs the CEO of Apple Inc. suggested that DRM (copy protection software) should be removed from music sold online. He said that ditching DRM is “clearly the best alternative for consumers, and Apple would embrace it in a heartbeat”. He is joined in this sentiment by Dave Goldberg, the music manager at Yahoo! who has repeatedly called for the removal of DRM. Real’s Rob Glaser said that “DRM-free purchases is an idea in ascendance and whose time has come.”

The EFF(Electronic Freedom Foundation) an online consumer advocacy group “agreed wholeheartedly with Jobs” and even went one step further in suggesting that Apple remove the DRM on the independent label content in the iTunes Store:

We agree wholeheartedly with Jobs, since EFF has been making exactly the same points for several years now. As a first step in putting his music store where his mouth is, we urge him to take immediate steps to remove the DRM on the independent label content in the iTunes Store. Why wait for the major record labels? Many independent labels and artists already recognize that DRM is a dumb idea for digital music, as demonstrated by the availability of their music on eMusic. Apple should let them make that music available without DRM in the iTunes Store now.There are also bigger lessons here for policymakers. The harm done by DRM could be reduced by reforming the DMCA to allow the evasion of DRM for lawful purposes. Moreover, Jobs’ remarks are another reason for policymakers to reject proposed government DRM mandates, which would only serve to further harm innovation, consumers, and artists. Clearly what’s needed in the digital music world is less, not more, DRM.

This has put Steve Jobs squarely in the camp of those opposing the RIAA (Recording Industry Association of America) which uses DRM to protect its music from piracy. In response to the challenge by Jobs the Association fired back saying that Apple should open up its anti-piracy technology to its competitors:

Doing so, argued Mitch Bainwol, chairman and chief executive of the Recording Industry Association of America, would eliminate technology hurdles that prevent music fans from buying songs at Apple’s iTunes Music Store and playing them on devices other than the iPod.

“We have no doubt that a technology company as sophisticated and smart as Apple could work with the music community to make that happen,” Bainwol said in a statement.

The major record labels – Universal Music Group, EMI Music, Sony BMG Music Entertainment and Warner Music Group – control some 70 percent of the music market and have maintained that DRM safeguards are needed to stave off rampant piracy.

Most industry analysts agree that DRM is hurting digital music:

“Clearly, DRM is not working,” said Ted Schadler, an analyst at Forrester Research. “It sends a message to the customer that ‘we don’t trust you.”‘

Phil Leigh, senior analyst at Inside Digital Media, suggested removing copy restraints would give the labels’ music more exposure.

“Digital music has entered the mainstream,” Leigh said. “The restrictions (the labels) require Apple and others to carry are preventing the market from developing to its full potential – it’s retarding the growth.”

Some however question the motives behind Jobs’ statement. The iTunes store which sells music only for iPod users, because its built in DRM prevents other music players from playing those songs, has come under criticism in many European countries. They have been pressuring Apple to open up its iTunes store to manufacturers of other digital music players. Apple has so far resisted this. Steve Jobs could be trying to deflect the sentiment that Apple is engaging in monopolistic and anti-competitive behavior.

Columnist John C. Dvorak says: Jobs is no idiot and after already proving that selling music online is a money-maker you’d think the big labels would pay some attention to him when he tells them to get off this DRM nonsense. He argues that the music industry is strangling itself.

According to Boldrin and David K. Levine, both professors of economics in Arts and Sciences at Washington University in St. Louis:

“Imposing copyright protection and anti-piracy restrictions, such as the DRM software, on this flourishing economic activity is a costly, silly and eventually useless tentative to block economic progress. To preserve the old rents of a few incompetent people who cannot, or are not willing to, adapt to the new ways of doing business is not the goal of a good property right legislation.