Apple to Split into Apple Computer & Apple Electronics

Is Sony two or more companies? They do computers, consumer electronics, music, films etc. Are their electronics and computers two separate companies?

When you go to their site, it says “Welcome to the world of Sony: Music. Movies. TV. Games. Electronics”

I think if Sony can do it all as one business, so can Apple.

Apple is already heading towards a showdown over anti-competitive practices w.r.t. iTMS & the iPod. Class action lawsuits, Attorneys General getting interested, countries other than France passing similar laws- it will get interesting.

The iTMS and iPod are not a monopoly just because they’ve done so well.

That’s right.  They’re a monopoly because they own 80% of the portable music market and used that advantage to lock out the ability of other manufacturers to compete.

Consumers still have the option of purchasing CDs and copying them to their iPod.

Consumers still have the option of using a Mac or Linux.  Does that mean that Microsoft isn’t a monopoly either?

The iPod is just a compliment to the computer. They feed off each other. You can’t cut the line between them.

This is exactly the argument that Microsoft used for including IE in the OS.  And I don’t disagree.  But that doesn’t mean that either company isn’t a defacto monopoly or that they’re using that monopoly to make it more difficult for competition to get a foot hold.

I honestly don’t think it’s quite fair of you to vilify Apple for using their advantage “to lock out the ability of other manufacturers to compete”. It’s not surprising that Apple’s protective of their DRM: firstly it’s going to be necessary to have some kind of drm to get content, and secondly they’re hardly going to use microsoft’s “open” [scoff] alternative.

What Apple *should* do is work to develop a standardised non-proprietary drm supported across tech and content industries. (Not least because it would royally screw microsoft!) But we can’t expect miracles, unfortunately.

Note that the ITMS doesn’t make money, but operates at or close to break-even. It exists entirely... let me reiterate: ENTIRELY... to sell iPods.

(And to secure a strong media-delivery position for future platforms.)

If the government couldn’t split up Microsoft, there’s no way they’re going to be able to split up Apple.

Also:
“What [Apple] really sell is an experience. They package up the whole deal and from start to finish they are there, and they make sure everything goes smoothly.”

So then, doesn’t it make sense to have one company doing all the work, so that the pieces can fit together as smoothly as possible?

Two companies are never going to be able to make as integrated an experience as one company.

Even look at PalmOne and Palm, or whatever they’re called now.

I didn’t say it was wrong. I was trying to get across that it’s the only way we can reasonably expect apple to behave.

The interesting point that you and Beeb appear to subscribe to is this:
You just don’t happen to define their refusal to do so despite an 80% marketshare as unfair or monopolistic; I do.

In other words, the fact that the marketshare is so high:
1. makes Apple a ‘monopoly’
2. means that they should open their DRM

Now I’m no expert but I don’t think that having high marketshare qualifies as a “monopoly” in the sense that we mean it.

That is, apple does have a “monopoly” because no-one else can really get a look-in. But the question we really ask when we say “is apple an unfair monopoly” is: have apple obtained their lead by monopolistic competition.

From wikipedia:
Industries which are dominated by a single firm may allow the firm to act as a near-monopoly or “de facto monopoly”, a practice known in economics as monopolistic competition. Common historical examples arguably include corporations such as Microsoft and Standard Oil”. Practices which these entities may be accused of include dumping products below cost to harm competitors, creating tying arrangements between their products, and other practices regulated under antitrust law.”

I don’t think apple should open their drm just because they have a high market share. I think they should open their drm because:
1. It creates a tying arrangement to ipod.
2. It is probably true to say that they have obtained their monopoly by monopolistic competition.
3. It will only benefit them in the long-term to have an open DRM since when their monopoly is eventually broken up, production will swap to other companies who will otherwise all be using microsoft’s version.

On the other hand, I did read this article only an hour ago:
http://daringfireball.net/2006/03/ipod_juggernaut

When was the last time Apple moved out a division in a separate company? Newton Inc.? Didn’t work so well,

Apple is about the whole thing, the whole experience, start to finish. All its products are tightly integrated, which contributes highly to their excellence. There is little logical reason to split up the company. Jobs also seems able to run more than one high profile & profit company simultaneously, and he doesn’t seem to lack any focus as it is.

As for the monopoly thing - pfff! There are countless PMPs out there, working with countless musicstores. You have plenty of options. I am sure though that the US or European legal system will in some way allow for someone to jammer his way through so he is finally granted the privilege of using DRMd low-fidelity downloads on his niche DAP instead of just frick’n ordering the CD or DVD from Amazon offering perfect quality for possibly even less money. Because that’s justice.