Apple is again in the crosshairs of Norway's Consumer Council over FairPlay DRM and music player compatibility. The company recently met with Norwegian officials in February, and it agreed that it wants to sell DRM-free music and that it shares Consumer Ombudsman Bjørn Erik Thon's goal of interoperable systems. But, says Thon, "iTunes [sic] has now had two years to meet our demands regarding interoperability. No progress has been reported by iTunes since our meeting in February." Thon today announced that Apple has until November to comply with the Consumer Council's demands or face official sanctions.
Over two years ago, Apple got into hot water with the Norwegian government over iTunes Store DRM. The problem is that the terms of service for the iTunes Store covering DRM-managed content prohibit compromising Apple's copy protection, and this runs afoul of Norway's Marketing Control Act. Since then, Apple began selling at least some music in a DRM-free iTunes Plus format, including music from EMI and many independent labels. That move gained Apple some respect from the Norwegian Consumer Council's senior advisor, but since then no other major labels have agreed to sell music in the iTunes Plus format.
Under Norwegian law, users who buy digital media are allowed to use the media with whichever device they choose. However, Apple doesn't license FairPlay to any other device manufacturers, and so far Apple hasn't licensed Microsoft's WMP-DRM to play songs encoded in Windows Media formats. So, Thon plans to demand that Apple make FairPlay-protected content playable on other portable music players.
Steve Jobs made his position on the matter known last year with his open letter entitled "Thoughts on Music." Apple wants to sell DRM-free music, but it's up to the record labels to agree to sell the music in this format, and so far only EMI and a group of independent labels have done so. Apple has also revised the iTunes Store's terms of use to include information on burning CD's to remove the FairPlay protection, but Thon says that all of this is not enough.
Norway tells Apple enough is enough: Make iTunes content work with other players, or face the consequences.
The predicament that faces Apple in the Norwegian market is complex, since both sides have fair points in the dispute. There are a number of ways to get DRM-free tracks to play on iPods: ripping your own CDs, buying iTunes Plus tracks, and buying music from stores like eMusic and the Amazon MP3 store (which, oddly enough, has DRM-free mp3s licensed from all major labels). Steve Jobs claims the company cannot license FairPlay without potentially compromising the licensing agreements that Apple has made with the record labels. And there is no mention of Microsoft's MSN Music (which may or may not "play for sure") or its Zune-only Zune Store. Nor is there any focus on movies or other video content.
What, exactly, Apple could do to appease all parties in the matter isn't clear at this time. But this case, according to Thon, will be a "test case" for the Consumer Council. Norwegian law allows the council to order companies to change practices it deems unfair, and it can issue fines if companies do not comply. Ultimately, Apple may have to shut down the Norwegian iTunes Store, or remove all DRM-protected content. Although Norway is not a member of the EU, its actions could have a serious domino effect there as Finland, Denmark, France, Germany, and the Netherlands, are all supporting Norway's actions.
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