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  1.    #1  
    August 4, 2009
    Rivalry Between Apple and Palm Intensifies Over Access to iTunes
    By JENNA WORTHAM
    The Palm Pre has a large touch screen, slide-out keyboard and fast Web browsing. Palm also likes to point out that another selling point is the smartphone’s ability to link to iTunes, Apple’s music and media store.

    Trouble is, Apple wants to make sure the iPhone is the only cellphone that can do that. So it changed its software to block the Pre’s access to iTunes.

    Now Palm is calling foul and is trying to rally the consumer electronics industry to its defense. Palm says that Apple, which allows only its own devices to connect directly with iTunes software, is misusing the standards put in place to foster interoperability between computers and devices using a U.S.B. connection.

    Palm has filed a complaint with the U.S.B. Implementers Forum, an industry group established by technology companies that developed the technology that links computers to other electronic devices, claiming Apple is restraining trade. Predicting the outcome of this particular filing is tricky, said Mike Abramsky, an analyst with the investment firm RBC Capital Markets.

    “There isn’t much precedent for this case,” he said. “It’s breaking new ground. In my mind, ultimately the users are the arbiters in the outcome of these situations.”

    The forum declined to comment on when it would respond to Palm’s filing.

    Currently, Palm, which once again has the Pre synching with iTunes, accomplishes the feat by duping the iTunes software into recognizing the phone as an Apple music player, allowing it to synchronize and transfer files between the phone and a personal computer. The tactic has raised some eyebrows among those who think that Palm’s approach itself is a breach of the standards set by the U.S.B. governing board.

    But Palm says its strategy of masquerading as an iPod is acceptable because it is in response to Apple’s restriction. “We think we are consistent with our compliance,” said Douglas B. Luftman, an associate general counsel for Palm. “We’re not trying to appear to be anything we’re not — except for interoperability purposes with iTunes.”

    Other devices not made by Apple work with iTunes, but generally require an additional download or intermediary step to work. Palm’s strategy, which allows an effortless connection between the smartphone and iTunes, is a first for the industry.

    If anything, Palm’s sparring with Apple underscores “how critical the iTunes ecosystem has become for consumers,” said Michael Gartenberg, vice president for strategy and analysis at Interpret, a market research firm based in Los Angeles and New York. “ITunes is the center of gravity where consumers keep their content.”

    Palm is not the only company clashing with Apple over its hardware and software policies. Google and Apple are tussling over Apple’s refusal to allow certain Google applications on the phone. On Friday, the Federal Communications Commission said it was looking into those actions.

    For Palm and Apple, the iTunes battle is part of a bigger rivalry. The Palm Pre, introduced in June to glowing reviews, has been lauded as a worthy competitor to the iPhone. The competition is also set against Palm’s luring some of Apple’s senior executives. Jonathan J. Rubinstein, Palm’s chief executive, once oversaw iPod development at Apple, and Mike Bell, senior vice president for product development, is another Apple alumnus.

    “It’s possible Apple is worried that customers might start buying Palm phones instead of iPhones or iPods,” said J. Gerry Purdy, the chief analyst of mobile and wireless at the research firm Frost & Sullivan.

    Mr. Gartenberg, the analyst at Interpret, agreed. “Apple understands that seamless relationship between the iPod, the iPhone and iTunes,” he said. “It’s a big driver behind why consumers are buying their devices, and they’re going to try and protect that.”

    Tom Neumayr, a spokesman for Apple, said, “As we’ve said before, newer versions of iTunes software may no longer provide synching functionality with unsupported digital media players.”

    The stakes are especially high for Palm, which once dominated the smartphone market with its Treo handsets. The company, which has been steadily losing market share since 2007, is counting on the Pre to reverse its fortunes. Paul Coster, an analyst with J. P. Morgan who follows the company, estimated that Palm shipped close to 180,000 devices in its first two weeks and could reach as many as 2.5 million in the fiscal year ending in May 2010.

    For Pre owners, accessing iTunes is important, said Katie Mitic, senior vice president for product marketing at Palm. “We appreciate that many, many of our consumers use iTunes as their music or photo management system,” she said. “We just want to make it as easy as possible for them to use it on the Pre.”

    Of course, the Pre also has software restrictions on synching with the Zune, the portable media player that is Microsoft’s answer to the iPod, but since it has few users, Palm is not fighting for access there. “The Zune has a much smaller market share,” Mr. Gartenberg said. “There are fewer people using it to control their media, so there are very few other vendor devices who are saying they want to hook into the Zune software.”

    Palm’s tiff with Apple also has some people wondering why Apple even bothers. Mr. Purdy, the analyst, described Apple’s decision to thwart Palm’s working with iTunes as “shooting themselves in the foot.”

    “All this means is that Palm’s customers would be able to purchase music through iTunes,” Mr. Purdy said. “This would offer an opportunity for increased revenue for Apple.”

    Tim Wu, a professor at Columbia who specializes in telecommunications law, copyright and international trade, said, “There’s something very unseemly about what Apple is doing.” He added, “It’s very counter to the ideals of openness, which is a concept Apple pioneered in computing.” In 2007, Steven P. Jobs, Apple’s chief executive, issued a call to the music industry for openness, titled “Thoughts on Music.”

    As for Palm, Mr. Wu said, “It sounds like an uphill battle, in terms of trying to stop Apple from doing this.”

    But Palm may have a shot. “The history suggests that openness wins,” said Mr. Wu, citing examples like AT&T’s attempts to restrict the devices attached to its phone lines and Apple’s early attempts to sell printers that worked only with Macs.

    It was not immediately clear how long Palm planned to battle future software patches from Apple that disable the smartphone’s compatibility with iTunes. The company did not say whether it would pursue lawsuits or enlist government aid on restraint of trade grounds.

    “This is a classic technology cat-and-mouse game,” Mr. Gartenberg said. “It often comes down to which side tires first.”
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  2. #2  
    I enjoy seeing Palm tackling Apple head-on like this. Not only does this give Palm some good press, but it also reveals the monopolistic nature of (new) Apple. I hope they continue as far as they can with this.

    I agree with how Michael Gartenburg states “how critical the iTunes ecosystem has become for consumers." iTunes has been proven time and time again on how influential it is in the media industry. He states how “Apple understands the seamless relationship between the iPod, the iPhone and iTunes" but, why should Apple refuse to allow other potential customers from this childish game.

    I generally don't like to rant about things over the internet, but over the past year Apple has become the very thing they hate. They are gradually going to crumble unless they straighten up.

    Good article btw.
  3. #3  
    Good post. I've said this in other threads, but I suspect Apple is playing right into Palm's plan. There is no downside for Palm here, and the press along the way (of which there will be more than they could ever want) will portray Apple as the big bad guy, and Palm as the innocent underdog. If Apple had left it alone, the whole thing would have fizzled. I would bet that Palm has all their plays already planned out, including software, legal, and marketing moves.

    It's truly genius, and Rubinstein deserves whatever they're paying him.
  4. Kedar's Avatar
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    #4  
    Good post.
    Article's pretty informative.
  5. OleSalt's Avatar
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    #5  
    Palm’s tiff with Apple also has some people wondering why Apple even bothers. Mr. Purdy, the analyst, described Apple’s decision to thwart Palm’s working with iTunes as “shooting themselves in the foot.”

    “All this means is that Palm’s customers would be able to purchase music through iTunes,” Mr. Purdy said. “This would offer an opportunity for increased revenue for Apple.”
    I would think Apple would welcome the additional customers and revenue! I really think they are missing the boat on this one....... Thousands of Pre owners buying iTunes instead of Amazon......
  6. #6  
    Always nice to see the phone you purchased on launch day get a nice write up like this.

    I have had, and still have, plenty of issues with the Pre but I don't regret buying it (or keeping it) one bit. Regular mentions in the NY Times reinforce that feeling.

    I use iTunes too.
  7. #7  
    I have a Zune, and would love Zune functionality. However, that being said, I realize most people don't notice how great the Zune (hardware and software) is, thanks to the almighty ipod.

    If having itunes sync will help the Pre, then I say go for it! I have never been a fan of apple, and don't plan on becoming one anytime soon, so I love to see anyone, stick it to them-so to speak. Especially when its a product I own!
  8. #8  
    I too wish it would sync with Zune! From sync'ing to the UI, Zune runs circles around iTunes. People just don't know any better because the Zune just doesn't sell as well.
  9. #9  
    Quote Originally Posted by OleSalt View Post
    I would think Apple would welcome the additional customers and revenue! I really think they are missing the boat on this one....... Thousands of Pre owners buying iTunes instead of Amazon......
    But on the other hand Apple loses thousands that might buy the iphone instead for seamless itunes integration.

    In a short time as OS's mature, the biggest differentiation Apple has going for them is Itunes (moreso the store). 1000's of apps, web browsing, etc will be pretty much standard features.

    Palm says that many many people use itunes. Welp, its because they bought ipods or iphones and they must use itunes with them. Many many people also use other phones, but you're selling a new OS and a new way of doing things. Why would you think people want all this newness but would prefer old itunes that sell video and apps only playable on a competitor's device?

    Itunes is basically a bloat of software that offers portals to purchase apps & media as well as syncing playlists.

    Sync software isn't too difficult. Amazon & others also have stores for media. Palm has an app catalog. The pieces are out there. Tie it all together Palm and offer new ways of doing things like wifi syncing, etc. Make it seamless. Itunes is so popular because noone has really challenged them.

    The more Pre's and other web OS devices that are sold, the more popular your version of itunes will become.
  10. gbp
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    #10  
    yup
    Creating a new software that competes with iTunes is the way to go for PALM.

    But they might have thought about existing iTunes users, so gave the option. In fairness there are about million iTunes users out there who have organized their music and just want to copy to Pre.
  11. #11  
    First I need to say that I really don't care since I'm not a member of the Apple cult or a user of iTunes. In fact the emotional Apple-hating side of me is actually applauding Palm's move. However...

    The thing that bothers me is that for Palm to trick iTunes into thinking that the Pre is an iPod, Palm must change the vendor ID field of the USB protocol by passing a fake ID. Palm's claim is that Apple is misusing the data in this field to restrict which devices may connect to iTunes. However, by their own reasoning Palm itself is also misusing the field to gain access to iTunes.

    In the world of Logic and ontology this is known as the fallacy of Two Wrongs Don't Make a Right. It's irrelevant to reason that Apple misuse of the vendor ID is justification for Palm's doing the same. Regardless, Palm is also misusing the vendor ID. It would have been more prudent of Palm to simply file the complaint without also committing the violation.

    On the other hand, Palm may be able to support this move with the argument that their users expect iTunes compatability given that Palm has been advertising it. However I still stand by the reasoning above since it's quite questionable weather Palm had any right to iTunes compatability in the first place.
  12. #12  
    [QUOTE=gbp;1803193]yup
    Creating a new software that competes with iTunes is the way to go for PALM.QUOTE]

    I dont agree at all. iTunes is a massive undertaking that would take incredible resources to go head to head with. It is not Palm's expertise- which is exactly why they are taking this to USB oversight committe.
    Last edited by Les Anderson; 08/04/2009 at 11:00 AM.
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  13. ION-q's Avatar
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    #13  
    Apple taking a page out of Microsoft's playbook is NOT smart.
  14.    #14  
    HERE IS ANOTHER PHONE ATTEMPTING TO TAP INTO ITUNES:

    INQ unveils handsets with Twitter and iTunes sync built inMobile phone maker INQ is releasing two new handsets boasting support for Twitter and iTunes compatibility, thanks to a deal with one of the internet's best-known hackers
    Buzz up!
    Digg it
    Richard Wray guardian.co.uk, Tuesday 4 August 2009 00.01 BST larger | smaller Article history
    INQ's new Mini and Chat handsets

    Mobile phone maker INQ is to follow its first award-winning eponymous mobile phone with two new handsets for the Christmas market.

    In addition to features the company hopes will appeal to buyers, the new phones will allow users to sync their phones with their iTunes or Windows music players through a deal with San Francisco-based startup DoubleTwist, founded by one of the internet's best-known hackers.

    INQ's two new 3G phones - the INQ Chat, which has a full keyboard, and INQ Mini - are aimed at the mass market and both allow users to access a host of applications including Twitter, Facebook and Skype as well as instant messaging and email from Hotmail, Yahoo and Google.

    The original INQ1 has won several awards for bringing internet applications to the mass mobile market since its release last year, but the new devices go further: allowing users to upload music and videos direct from iTunes.

    It uses technology developed by DoubleTwist, which is backed by Index Ventures and NorthZone Ventures - two venture firms whose records boast close links with Skype, Last.fm and streaming music service Spotify.

    DoubleTwist was co-founded by by Jon Lech Johansen, who is better known among the digerati by his alias DVD Jon after his success in cracking DVD copy protection technology in the late 1990s. For his part in breaking the code, Johansen was arrested and charged in Norway with circumventing a computer security system without permission, before being acquitted by a court in Oslo.

    Since then, Johansen has turned his attentions to Apple's FairPlay digital rights management software in order to allow iTunes tracks to be played on any device.

    "iTunes is pretty good at what it does, but from a consumer perspective it doesn't do everything," Johansen told the Guardian in an interview earlier this year.

    It is not clear, since Apple fiercely protects the link between the iPhone and iPod and its iTunes music player. Last month the Californian technology group released a new version of iTunes which effectively shut out rival handset manufacturer Palm after its Pre handset was able to sync with iTunes. In a game of cat and mouse, Palm has since updated its operating system so the device can again be synchronised with Apple's player.

    DoubleTwist, however, allows devices as diverse as the Sony PSP, BlackBerry and the HTC G1, which uses Google's new Android platform, to synchronise with music stored in iTunes without having to break into iTunes itself, so it is not as easily kept out as Palm.

    The two new phones from INQ, set up by Hutchison Whampoa, the Hong Kong-based owner of mobile network 3, both have Twitter built-in, meaning that users do not have to send or receive texts in order to keep up with the micro-blogging site, instead once they have logged-on it is 'always on' in the background, using the phone's data connection. On the INQ Chat, Twitter updates appear directly on its home screen.

    Both phones also operate as HSDPA modems, meaning they can be plugged into a PC or Mac for mobile internet access. The INQ Chat has a 3.2 megapixel camera while the INQ Mini has a 2 megapixel camera. Both can support up to 8GB of memory although it will be up to the operator shipping the phones to decide what size memory cards to include.

    "We build phones that focus specifically on what people want to do most on mobile, and deliver it at a price point that's easy for consumers and profitable for operators," explained INQ's chief executive Frank Meehan. "We have completely broken the vice grip hold that high end smartphones had on great mobile internet experiences, and made them available to everybody."
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    INQ unveils handsets with Twitter and iTunes sync built in
    This article was first published on guardian.co.uk at 00.01 BST on Tuesday 4 August 2009. It was last updated at 00.09 BST on Tuesday 4 August 2009. Most viewed on guardian.co.uk
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  15. #15  
    That was a ridiculously long post just to say Doubletwist isn't cheezy and cheap like Palm is when it comes to iTunes Syncing. Doubletwist and Mark/Space both sync with iTunes libraries and don't use Apple's proprietary software without permission/license. Palm could too, but apparently lacks the imagination to come up with its own solution.
  16. #16  
    Or maybe Palm wants to concentrate on what they are good at instead of writing media management software.

    Quote Originally Posted by Kupe View Post
    That was a ridiculously long post just to say Doubletwist isn't cheezy and cheap like Palm is when it comes to iTunes Syncing. Doubletwist and Mark/Space both sync with iTunes libraries and don't use Apple's proprietary software without permission/license. Palm could too, but apparently lacks the imagination to come up with its own solution.
  17. #17  
    Quote Originally Posted by Les Anderson View Post
    Or maybe Palm wants to concentrate on what they are good at instead of writing media management software.
    So Palm provides a media-capable phone with no media management software? Interesting. What software did Palm concentrate on that they are so good at that it stands out from the field? Please don't say the card interface since it only enables you to use the functional software. Calendar? Video camera? Desktop sync?
  18. #18  
    I would say their expertise is mobile phone operating systems like webos.

    Quote Originally Posted by Kupe View Post
    So Palm provides a media-capable phone with no media management software? Interesting. What software did Palm concentrate on that they are so good at that it stands out from the field? Please don't say the card interface since it only enables you to use the functional software. Calendar? Video camera? Desktop sync?
  19. #19  
    Quote Originally Posted by Les Anderson View Post
    I would say their expertise is mobile phone operating systems like webos.
    Whoop-de-do. An OS doesn't do anything except enable functional software (good and bad) to function. By your statement, if that's Palm's focus in the software department, then they're doomed in the mobile connected device market. You should have said Web Browser - at least that works pretty well. Email is good too, as is chat. None of those are really stand out, but they do make the Pre functional.

    You haven't fallen for a philosophy of form over function have you?

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