Original URL: http://www.theregister.co.uk/2004/09/08/apple_itunes_japan_hitch/

iTunes Japan hits 'inadequate DRM' hurdle

Local labels unhappy with potential pricing, too

By Tony Smith

Posted in Media, 8th September 2004 13:37 GMT

Apple's plan to open a Japanese version of its iTunes Music Store could be scuppered on local music companies' fears that its DRM technology, FairPlay, simply isn't restrictive enough.

Pricing is also an issue, it seems, with labels fearing the cannibalisation of CD sales, a report in Japan's Asahi Shimbun newspaper claims.

According to the report, ITMS Japan has met with opposition from a number of local music labels who claim that FairPlay is "inadequate" and are thus refusing to license their songs to Apple.

At issue is the Mac maker's insistence that consumer should be allowed to burn downloaded songs to CD, a facility offered by the US, UK, German and France versions of ITMS.

Existing Japanese digital music services do not support CD burning. They also charge from ¥200 ($1.83) a song - rather more than the Yen equivalent of the US store's $0.99 (¥108) download fee.

"If we go lower than [¥200], CD sales will suffer," an official of a major record company told the paper. Yet at the same time, the industry needs a price that will compete with low-cost CD rental companies, he admitted.

However, Apple Japan's marketing chief, Yoshiaki Sakito, told the Asahi Shimbun the clout of iPod will be sufficient to bring such waverers into line.

"The record companies won't be able to swim against the tide forever," he said. ®

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