There hasn’t been much mentioned about consumer harm as of yet, and so the remainder of this paper will focus on whether the DRM software model that Apple has created harms the consumer’s rights. Apple’s ability to gain access to the music industry’s catalogue of music came when they demonstrated the strength of their DRM technology. The technology limits the amount of sharing and general distribution of the music files in order to preserve the copyright. However, in doing so, it tends to curb the consumer’s expected ability to use the music.

Is Apple’s DRM software fair? First, what does fair mean in this context? The question is whether the restrictions do a good enough job protecting the musician while allowing the consumer to use the product that they have purchased. The simple answer is yes. The extensibility of the DRM software includes unlimited CD burns, unlimited devices, and five computers. This is a significant amount of liberty given to the consumer considering the strength of the DMCA. One of the problems facing the distribution of digital music is that because the initial onslaught was completely illegal the expectation is that music should be distributed as freely as desired at the least price possible. This was never true of music before, and won’t be in any business model pushed forward by the music industry. Therefore, part of the challenge is teaching proper usage of digital media to a consumer base who has quickly gotten used to its mischievous ways. Through its DRM technology, Apple is helping create a better consumer.

By providing quality MP3s, allowing a quite liberal degree of sharing, and offering an extensive music library, Apple has shown that the market for legal digital media distribution is quite strong. The iTunes Music Store has taken advantage of the “Long Tail of Software” , which claims that without traditional infrastructure needs the Internet can offer a greater range of retail products than conventional retail stores. Apple claims that every song in their music library has been sold at least once. This is a much greater distribution of product sales than the traditional retail store, which gets 80% of its revenue from 20% of its inventory. Why are there consumers when finding the content online for free is also an option? The answer is usually time and quality. The time invested in finding the version at the quality desired is worth much more than the $0.99 to buy it immediately. As a result, these two factors have created a consumer experience that in fact benefits from the iTunes Music Store model.

Overall, I would argue that the iTunes Music Store has helped show that the next evolution of the music industry is sustainable. As a result, it has created an efficient business in digital media distribution. However, it has tied-in the sale of its hardware with the installation and configuration of its software model, and I think I have showed that enough circumstances exist to warrant an anti-competitive query into these business practices. I’m not sure what the result of breaking up this relationship would be on the consumer, but I think if it’s done properly, then it will in fact create a more competitive industry for digital media distribution.


  • DMCA Up for Review – O’Reilly Mac Devcenter Blog. December 10, 2002.
  • iTunes 2005 revenue could equal 5 percent of U.S. music sales: Call it a powerhouse. January 24, 2005.
  • Q&A: Jobs on iPod’s Cultural Impact. October 16, 2006.
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  • iPod market share falls – to 87%.,1759,1712064,00.asp. November 4, 2004.
  • Zune: First Full Review. November 3, 2006.
  • iPod. October 18, 2006.
  • The “efficiency defense” in the US American merger policy. April 8, 2003.
  • The Long Tail.