Welcome!

@CloudExpo Authors: Elizabeth White, Zakia Bouachraoui, Liz McMillan, Pat Romanski, Roger Strukhoff

Related Topics: Open Source Cloud, Java IoT, Linux Containers, Adobe Flex

Open Source Cloud: Article

RealNetworks Ambushes iPod/iTunes with Price War, Puts Gun to Apple's Head

RealNetworks Ambushes iPod/iTunes with Price War, Puts Gun to Apple's Head

RealNetworks, the company Apple won't talk to, put a gun to Apple's head Tuesday to force it to deal.

Since Apple won't negotiate, RealNetworks has set out to rustle its customers.

Real has already picked the lock on Apple's precious iPod, making it possible for the gizmo to play the songs that Real sells - which are no different and usually no differently priced than the songs that Apple sells - and freed iPod users from captivity to Apple's iTunes Music Store.

Now, in the name of giving people a choice, Real is selling its tunes at half price, 49 cents a pop - less than it costs Real to buy them - to stampede Apple's users into the Real corral. Most albums have been slashed to $4.99.

Real CEO Rob Glaser figures this so-called Freedom of Choice campaign, which could run through Labor Day weekend in early September, will be the biggest music sale ever, big enough to cost Real maybe a penny a share this quarter.

The widgetry making this little maneuver possible is a thing called RealPlayer 10.5 - the first RealNetworks products to include the controversial Harmony Technology that picks the lock on iPod.

RealPlayer plus Harmony means that people who use it to download tracks from the Real Music Store can play those tracks on a hundred portable devices, including all four generations of the iPod and the iPod mini.

Real trotted out the Harmony beta at the end of July to the protests of Apple, which branded Real a hacker and threatened it with Digital Millenium Act retribution and changes in its own iPod code that would make Harmony fail.

Tuesday Apple said nothing about taking Real to court but reiterated its threats to make iPod incompatible with Harmony.

Real describes Harmony as a DRM translation system, the first of its kind, supposedly developed in a clean room - a claim that may have stayed the hand of Apple's lawyers - that lets people transfer the music they bought from Real to just about any popular music player that uses Apple's cracked FairPlay protection technology, Microsoft's Windows Media Audio DRM or Real's own Helix DRM.

Glaser told the New York Times that he expects the cheap music push to make Apple realize that it should open up the iPod to tracks sold by competitive digital music services. Real won't make any money but Glaser is expecting to reap "residual benefits" and long-term "increase the odds the digital music world will operate the way the physical world will." He compares RealPlayer with Harmony to the way CDs and DVDs work.

The potentially massive giveaway has forced Real to revise its Q3 estimates and project a GAAP net loss of three cents-five cents a share. It previously figured it would only lose three cent-four cents a share.

The company still expects to reach profitability, excluding the cost of its antitrust litigation against Microsoft, by the end of this year.

Harmony will be available later this year in other Real music products, including its Rhapsody subscription service.

As part of the Freedom of Choice campaign, Real is launching a new Web-based community at www.freedomofmusicchoice.org to give consumers a place where they can air compatibility issues.

More Stories By Maureen O'Gara

Maureen O'Gara the most read technology reporter for the past 20 years, is the Cloud Computing and Virtualization News Desk editor of SYS-CON Media. She is the publisher of famous "Billygrams" and the editor-in-chief of "Client/Server News" for more than a decade. One of the most respected technology reporters in the business, Maureen can be reached by email at maureen(at)sys-con.com or paperboy(at)g2news.com, and by phone at 516 759-7025. Twitter: @MaureenOGara

Comments (5)

Share your thoughts on this story.

Add your comment
You must be signed in to add a comment. Sign-in | Register

In accordance with our Comment Policy, we encourage comments that are on topic, relevant and to-the-point. We will remove comments that include profanity, personal attacks, racial slurs, threats of violence, or other inappropriate material that violates our Terms and Conditions, and will block users who make repeated violations. We ask all readers to expect diversity of opinion and to treat one another with dignity and respect.


CloudEXPO Stories
The platform combines the strengths of Singtel's extensive, intelligent network capabilities with Microsoft's cloud expertise to create a unique solution that sets new standards for IoT applications," said Mr Diomedes Kastanis, Head of IoT at Singtel. "Our solution provides speed, transparency and flexibility, paving the way for a more pervasive use of IoT to accelerate enterprises' digitalisation efforts. AI-powered intelligent connectivity over Microsoft Azure will be the fastest connected path for IoT innovators to scale globally, and the smartest path to cross-device synergy in an instrumented, connected world.
There are many examples of disruption in consumer space – Uber disrupting the cab industry, Airbnb disrupting the hospitality industry and so on; but have you wondered who is disrupting support and operations? AISERA helps make businesses and customers successful by offering consumer-like user experience for support and operations. We have built the world’s first AI-driven IT / HR / Cloud / Customer Support and Operations solution.
ScaleMP is presenting at CloudEXPO 2019, held June 24-26 in Santa Clara, and we’d love to see you there. At the conference, we’ll demonstrate how ScaleMP is solving one of the most vexing challenges for cloud — memory cost and limit of scale — and how our innovative vSMP MemoryONE solution provides affordable larger server memory for the private and public cloud. Please visit us at Booth No. 519 to connect with our experts and learn more about vSMP MemoryONE and how it is already serving some of the world’s largest data centers. Click here to schedule a meeting with our experts and executives.
Darktrace is the world's leading AI company for cyber security. Created by mathematicians from the University of Cambridge, Darktrace's Enterprise Immune System is the first non-consumer application of machine learning to work at scale, across all network types, from physical, virtualized, and cloud, through to IoT and industrial control systems. Installed as a self-configuring cyber defense platform, Darktrace continuously learns what is ‘normal' for all devices and users, updating its understanding as the environment changes.
Codete accelerates their clients growth through technological expertise and experience. Codite team works with organizations to meet the challenges that digitalization presents. Their clients include digital start-ups as well as established enterprises in the IT industry. To stay competitive in a highly innovative IT industry, strong R&D departments and bold spin-off initiatives is a must. Codete Data Science and Software Architects teams help corporate clients to stay up to date with the modern business digitalization solutions. Achieve up to 50% early-stage technological process development cost cutdown with science and R&D-driven investment strategy with Codete's support.