Europe vs. Apple: Facing the Music - by Dan Carlin
When Norway's consumer protection agency filed a complaint last June against Apple (AAPL), the Cupertino (Calif.)-based digital music and computing giant barely blinked. After all, with sales booming around the world, how much damage could a small band of critics in a nation of 4 million people wreak?
Plenty, it turns out. The Norwegian Consumer Ombudsman continued to develop its case, which alleges that the exclusive link between Apple's iPod and iTunes music store violates Norwegian consumer law by preventing iPod owners from playing songs bought from other online services or listening to iTunes songs on rival MP3 players. "We want to make it very clear in Norway that their business isn't fair to consumers," says Torgeir Waterhouse, a senior advisor to the Norwegian Consumer Council, who is leading the Apple investigation.
The risk facing Apple is that the European Commission, which made waves with its antitrust case against Microsoft and could strike again against Intel (INTC), might step into the battle. "If Apple becomes the major hub between the consumer and the music industry, one could argue there's a need for Europe-level intervention," says Stefan Bechtold, senior research fellow at the Max Planck Institute for Research on Collective Goods in Bonn, Germany.
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