I imagine Jobs is planning to license the iTMS and the iPod to more computer makers. If it's pre-installed and they're selling the iPod as well, that's a far better way to expand the market than to give the technology to your competitors and let them offer a competing service. Come on guys, business 101.

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Reconsider it! It is better to think about it, appologize and take it, then let the competition kill AAC. So where is AAC in Europe, rest of the World? Nowhere. Apple, with Real you could do some great things, do not let us down! Please reconsider this issue and partner up!

Apple sells iPods as fast as they can make them?

Why would opening it up to Real give them more sales. People can go to the iTunes store just as easily as the Real store?

The only benefit would be that AAC is used in another store. But I don't know how much of a benefit that would be for Apple?

1. I think Jobs is making a mistake regarding real

2. but he has done great things for apple the last few years

3. The iPod IS an open platform. Plays mp3 a standard. Anyone can rip an mp3

4. I own an iPod and I have NEVER downloaded a file from iTunes music store. Strictly CDs.

No reason at all to co-operate with these jokers....why would Apple prop up a competing music store? They're already squeaking out a small profit on their own.

These are just companies trying to latch onto the caché of the iPod...there is no compelling business reason for Apple to do a deal with anyone right now.

this is NOT as simple as "hey, we'll sell your content via our store and on our players." why should apple take its easy-to-operate 99cent model and integrate a subscription based service support??? i agree with jobs -- way more headache than it's worth.

Ok folks, here's why Apple didn't accept a deal with Real...

Real is fast discovering they are the odd man out. They have not been able to form a partnership with Microsoft, and at very best their relationship with MS is still awful. They're realizing Apple is the market leader and reaching at straws. On one side, you have MS threatening to come into the market. With their size and OS marketshare, they are going to be a substantial player. One the other side, you have Apple - the innovative company that started this whole thing. In the middle, you have companies like Real who are trying to figure out where they fit in.

Right now, Apple (and eventually MS) realize they can put others under. Apple has the resources, both financial and technical, to push their service and their player. Real DOES NOT have these same resources. They make a peice of software and make their money on content. Adding content, such as a music store, only helps bring in more money. But what do people do with this content??? Right now, nothing! That's Real's problem. Real NEEDS Apple cooperation, because they need access to Apple's iPod.

Could this help open sell more iPods? Perhaps. I wouldn't deny that. However, Apple already provides the best end user solution to their own products (in their opinion and in the minds of many users). But again, they have the opportunity to sink Real right now... and given Real's desperation to form an alliance, one would think this is happening.

Also, in the "real world" business deals don't happen this way. You do not anger another company's CEO or call their products poor. Then try to strick a business deal with them. READ THE EMAIL THAT WAS LEAKED! It was not as much a proposed deal, as it was a threat. Anyone who works in business would not propose an idea this way! You do not try to set up a meeting by telling another company, "This is when I could meet, it's your loss if you don't attend!" Honestly, if Real wanted to form a serious partnership, they would be willing to meet with Apple at 2 am on Christmas Day! Also, you would not have your spokesperson continue to say things like "Why doesn't Apple open up the iPod?" Again, these are threats.

I can't blame Steve or anyone else for not wanting to do business with Real. If this is how they choose to relate to other companies, you can imagine what type of "service" they would give to customers if they bought music.

I love what Steve Jobs has done for the company, but he is so damn arrogant. This one will come back and bite him in the a**. This leaves the door open for a RealNetwork/Microsoft deal and who can blame them. RealNetwork tried but Apple has a long history of making arrogant business decisions. Would I like to be proven wrong? Absolutely! But with Microsofts "iPod Killer", European music service launch, and being allied with just about everyone, perhaps soon to be allied with RealNetwork, Apple should be worried not smug about their current position.
I'm dissapointed.

Yes, if Real was using 'Scare Tactics' to do it, Jobs would tell 'em to get stuffed.

But ... promoting a 'non-Windows Media Player' format can be nothing but good I think.

There has to be 'more' to the story.

This is going to be the instance people point to when iPods only have 3% of the market, way behind the cheaper, more accessible copy-cats.

Steve Jobs is absolutel the biggest idiot walking around on the face of this planet today. HE IS REPEATING HISTORY AGAIN!!!! The very thing that has RELEGATED THE MACINTOSH TO NICHE STATUS is the fact that STEVE IS TOTALLY ARROGANT -- never opening up the Macintosh OS to other developers! AND NOW -- HE'S DOING IT ALL OVER AGAIN!! You think the other companies are gonna sit idly by and allow this to happen? Customers will want to purchase music from ANY ONLINE SERVICE and transfer those songs to their iPod. This is going to COME BACK AND BITE STEVE'S BUTT IN THE END. This is going to be a miserable FAILURE for Apple, yet again. I can't believe that Steve hasn't learned from 20 years of mistakes.

... I think they're comfortable with a extremely small market share that they're planning to reduce their MP3 player marketshare over the next 3 years so they're at a comfortable 1.7%.

By then, the Microsoft Underestimated Digital Device (MUDD) with WMP v11 will have the market.

I mean, does anyone know if there's anything churning with Quicktime 7? They sure seem to have slipped over the years with Quicktime Conferencing, Quicktime TV, etc.

Sometimes wish I knew what actually goes on behind the scenes as it's so simple for us armchair execs!! ;-)

This is not history repeating. I know everyone is worried, but this is not the same. Apple simply decided not to work with this particular company. Real is an inferior company. Who knows, Apple may look at opening up more to others services, but now is not the time and this was not the right opportunity. Given the comments by Real, both in the email and press, I can't imagine why anyone would want to work with them.

The partnership with HP makes much more sense than this would've.

QuickTime was a great product once. Then came real and MS. Apple is the niche player here.

Maybe licencing just FairPlay would be nice.

But I think SJ is not stuipid. They have their reasons (maybe we will know end of the month when ITMS has anniversary).

And I don't care so much.

very, very, very dumb. I can't believe they are repeating history again...to a T. Greed drives these decisions. They don't realize that the iTunes music store is just no. 1 temporarily. It will be very hard to hold on to that lead with the current mentality. Over the long run they would have made much more money with the licensing fees. Just look at IBM's cash cow. Apple will always be relegated to the niche. I still love their products though.

"That attitude is precisely what is causing headaches for OS X's Safari users... if you aren't using Explorer, tough luck."

I don't think the attitude is to blame for Sarari problems.. We have a perfectly standard-compliant browser that have problems accessing badly coded/non standard website. I don't recall seeing < marquee > or JScript in the HTML specs, though..

Apple's file format is based on a standard formed by Dolby, sony, etc and is called MPEG-4 (in fact it's the reverse, MPEG-4 is based on QT, but they didn't choose this for nothing). Now people prefer to use a ultra-proprietary and inferior format and accuse Apple because they want to use their superior (standard) format.

http://www.apple.com/mpeg4
http://www.apple.com/mpeg4/aac/

You guys keep saying how Apple is making a mistake, Steve is arrogant, and this will help the iPod sales. How does that work exactly? Giving Fairplay AAC to Real doesn't open up any new markets. It might take market share away from iTMS, which will give Apple less leverage to make deals with record labels, which will hurt Apple and the iPod in the long run. It'll just cause more problems for Apple. As another poster had said, it's about the user experience as well. The Real experience is lame. What do you think the Real experience will be like for buying online music? If it's as lame as it is historically, Apple will be taking the blame b/c their iPod "won't work."

For the uninformed: AAC is not something Apple thought up one day. In fact it has little to do with apple. AAC is used by alot of people. What other companies want opened up is the fairplay format required for the ipod to understand the DRM.

Apple seem to want to go as far as they can with the music store, but my guess is they will be ready to support other devices at the drop of a hat. But think about it. The iPod is the most popular mp3 player there is at the moment. Its expensive, but everyone still wants it. I see no reason for this to change. So now lets think about the only other factor affecting peoples decision about what mp3 player to get: the music store. Apple's store is unarguably the best for the user, easy to navigate and itunes makes it all so simple. Song prices are the same as everywhere else EXCEPT for companies such as walmart who intend to take huge losses at first, increasing the prices to the typical $0.99 when they have wiped out the competition. There is no compelling reason to use any store besides the apple store. The AAC files sound good for compressed audio, certainly of a better quality than 160kbs WMA files.

Frankly I don't understand why people use a music store. A CD costs almost the exact same amount now and can be downloaded to itunes/ipod as aiff and it will lose no quality. The music store is low quality music, with no physical proof its yours, no backup if your computer dies. With a CD you get high quality audio, you get a physical CD and case to stroke at your discretion, you can use it/ copy to unlimited numbers of devices you own at the highest quality, your rights never have a chance of being compromised unless you do something illegal, you never have to worry about losing your music the list goes on and on.

The truth is that music stores are tiny, insignificant even. For the standard computer user, perhaps low quality highly restricted audio for the same price as it is in the shops is acceptable, The conveinience will obviously appeal. However, true audiophiles will know that you can't beat a CD....or maybe an LP....much warmer sound than the sterile CD.

Oh! and another thing. Don't think the apple store is number one. There are over 60 european music stores, and they are all very close to, or exceeding sales of apples music store. America is NOT the world. Europe is much larger and a better market for things such as this. Mobile phone companies realised this too, and we (europe) recieved all the mobile phone tech in advance of the US. Apples biggest mistake is not offering the iPod mini now. America may be big, but europe is bigger and the demand is unbelievable. Think 909% increase of sales is good? at the moment, ipod prices are twice what they are in the US for most countries in europe (due to the poor performance of the dollar). In europe apple could have expected twice the increase at least (1818%) and thats at the very least. Apple hav

This will only work until someone -- using Microsoft technology, no doubt -- comes out with an MP3 player almost as good as the iPod but at one fourth the cost. Then the iPod will be marginalized along with the rest of Apple. But I got mine!

Let's imagine a different scenario.

Say McDonalds has a special sauce for it's hamburgers. Say everybody loves those hamburgers. Everybody eats those hamburgers.

Now along comes Burger King, and they have this thing called the Whooper. Some people like it, but most people still eat the McDonalds hamburgers.

So Burger King calls up Apple...er...I mean McDonalds and says "Yo, we need some of that secret sauce." McDonalds, of course, being in their right minds say "Go suck an egg."

And so ends our story of the music...I mean...burger market.

Oh...and it doesn't help any that McDonalds has the coolest toys that everyone wants. Mmmm....McPods...

"Frankly I don't understand why people use a music store. A CD costs almost the exact same amount now and can be downloaded to itunes/ipod as aiff and it will lose no quality. The music store is low quality music, with no physical proof its yours, no backup if your computer dies. With a CD you get high quality audio, you get a physical CD and case to stroke at your discretion, you can use it/ copy to unlimited numbers of devices you own at the highest quality, your rights never have a chance of being compromised unless you do something illegal, you never have to worry about losing your music the list goes on and on."

You are right, there are some downfalls to online music stores. And looking at whole albums, a physical CD is better than buying donwloaded music. But, the reason, and many other people, use a online music store is because we don't want to pay for the whole CD. We want one or two songs, and that's all we want to pay for. I still by CDs of artists who make good entire albums. But I use iTMS to supliment that with a song here and there that I like but I don't want to pay for an entire CDs of songs for.

"The truth is that music stores are tiny, insignificant even. For the standard computer user, perhaps low quality highly restricted audio for the same price as it is in the shops is acceptable, The conveinience will obviously appeal. However, true audiophiles will know that you can't beat a CD....or maybe an LP....much warmer sound than the sterile CD."
Most people can't tell the different b/w CD quality and music store quality. And even if they notice a small different, they don't care.

Do you first choose your music store, and then see what player works with that? Or do you choose the player you like and then shop at whatever store supports it?

The latter is more likely. Licensing FairPlay to Real will only take song sales away from Apple. People aren't sitting home saying "Gee, I'd buy an iPod if it only worked with Real's online music store!" But I'll bet there are more that would say "Yeah, I'd consider buying music from Real if it worked with my iPod." How is that good for Apple?

DOES THIS SEEM FAMILIAR TO ANYONE?

Apple with proprietary hardware and software, refusing to open it up and thus losing market share?

Same exact thing as what happened to the Mac.

Does Apple think they are going to own the #1 spot forever? How short-sighted. These other companies are going to continue to work on standards and will use other methods of digital rights management until a clear standard emerges. Then Apple once again gets delegated to the land of 5% market share and less.

Sheesh.

for not licensing the Mac OS. Not Jobs. Get your history right boys. Also, upon Steve's return to Apple, he pulled out of licensing because it was already too late and Apple was losing money on the crappy delas of the Amelio-age.

This has NOTHNG to do with Steve Job's ego. This is about BUSINESS and the future of the iPod and the iTunes Music Store. Do you not think that Apple had already thought this through. Do you not think they already have a strategy? Maybe it has something to do with the launch of the Euro-ITMS. Anyone that spews the "Steve Jobs ego is getting in the way, blah, blah, blah" is just ignorant to the fact that turning down Real came down to a "business-related" decision and not an "ego-related" one. Steve is surrounded by some of the most intelligent people in the industry. More than likely he did not make this decision on his own.

Licensing Apple's FairPlay DRM would only cannibalize sales at the ITMS. Especially on Windows side of things. They are starting to make money so why would they cut into their own profits? As long as Apple continues to innovate they will stay ahead of the WMA. Does anyone really buy from BuyMusic? Come on people. Get your heads out of your asses.

Music stores are about convenience for people that do not need the actual CD. The human ear for the most part cannot tell the difference between a CD and a standard Apple AAC. Quality is determined by the source and it's not like Apple is downloading MP3s off of Kazaa and re-ripping them into AAC files. So unless you're going to spend a shitload of money on the most highest of high end audio equipment, no one knows the difference. Also, some people have no need for the plastic case, the printed inserts, or even the drive out to Best Buy, etc. Sure, there are some CDs people will buy. Especially from their favorite bands, but until the overall quality of the content being released on CDs improves, the public will be more drawn to use a music store to buy just the tracks they have heard or like.

The real point here is that RealNetwork is desperate and their only way in is to stick up with a big guy, as far as Apple is concerned that means there's one less competitor to beat. While licensing fairplay ***might*** sell more iPods it just means that Apple no longer sell as many songs as they could because iPod users at the moment can only buy from Apple, so while they may see an increase in iPod sales, which is doubtful as I think iPod users don't actually mind buying from Apple (heck, they bought their MP3 player from the same place, duh), Apple will definetly see a loss in download sales. As the Merovingian in The Matrix said: "if you want to make a deal you've got to have something I want". So, Mister Glaser, what do you have that Apple wants???

apple is concerned about what? ease of use and image... now what's real like? on the windows side, it's all ads. ads, ads, ads. How hard is it to download the free RealPlayer (not some goldpass or whatever it's called)? How hard? Does apple want that kind of image with their iPod and music store? Now if Real had a good image... i don't think apple would partner with them anyway, but that's not the case so i can't say...

on Apple's part to not deal with Real, at this time. Why make a decision that would affect the future of the wildly successful iPod and iTMS when:

* Currently, Apple is already selling as many iPods as it can make.
* Currently, Apple has the #1 music player (by far) and the #1 music download service AND its marketshare is INCREASING.
* Real offers nothing of compelling value from its music service that is not already available to iTMS users.

The time to make decisions about licensing FairPlay (or even iPod technology) is when Apple's marketshare has reach an equilibrium point. Whether it's going to be at 40%, 60%, or 98%, THAT is when to assess the situation and determine the future for licensing. The terms Apple can dictate at 40% is a lot different than at 80%. The situation at that time should dictate the right decision, not now.

And please don't make lame comparisons with how Microsoft came to dominate because Apple failed to open the Mac OS. IBM was the big loser because it DID make the PC-compatible design "open." Microsoft took advantage of that and became dominant because it kept Windows "closed." Apple has the potential to be Microsoft of music downloads and players.

So I'm not saying Apple should never license its music-related technology. I'm saying NOW is surely not the time to make such decisions. Stay the course as long as Apple's marketshare numbers are trending up. When they level off, then make smart decisions based on the situation at that time.

ipod23 said it best. Apple does not need Real. There is nothing to be gained for Apple to have an agreement with Real.

> DOES THIS SEEM FAMILIAR TO ANYONE? Apple with proprietary hardware and software, refusing to open it up and thus losing market share? Same exact thing as what happened to the Mac.

:) No. Apple is currently GAINING marketshare with iPod/iTMS. You can't lose marketshare until you stop gaining marketshare. Stop the paranoia.

And not "exactly same thing as Mac." The Mac OS never had the dominance that iPod and iTMS enjoy (not even close). Apple will form partnerships for iPod and iTMS (as with HP and AOL), but it can afford to pick and choose. The folks who are berating Apple are playing into the hands of Microsoft and Glasser (Real). Apple has nothing to gain by working with Real. iTMS is the most popular service. iPod is the most popular player. There is no reason a user of Real's music service would not simply switch to iTMS if they wanted an iPod. If they don't want an iPod, having Real offer it is not going to change their mind.