Apple Insider – Tuesday, November 28, 2006:

Following a successful campaign that garnered it a piece of each Zune media player Microsoft sells, an emboldened Universal Music Group may be turning its attention to Apple Computer’s iPod.

Speaking to a Reuters Media Summit on Tuesday, UMG chief executive Doug Morris said he may look to tailer a similar deal with Apple that would include a kick-back from iPod sales.

“It would be a nice idea,” he told attendees. “We have a negotiation coming up not too far. I don’t see why we wouldn’t do that… but maybe not in the same way.”

Morris added that it “was an amazingly interesting exercise,” to end up with a piece of technology in the case of Zune.

Earlier this year, UMG refused to license its music to Microsoft unless it could receive a percentage of each Zune sold, in addition to the standard music licensing fees for downloads and subscriptions.

These [digital music player] devices are just repositories for stolen music, and they all know it,” Morris was quoted as saying at the time. “So it’s time to get paid for it.

According to published reports, Microsoft ultimately agreed to hand over approximately $1 to UMG from the sale of each $250 Zune.

Apple and UMG are due to meet at the round table for a new phase of music licensing negotiations in early 2007.

I personally think this is a great idea and that deals should be worked out will all the labels. Because if we pay royalties for “stolen” music on our iPods, then we would have the right to put “stolen” music on them. If the RIAA tried to sue an iPod user, he’d have a perfect defense: “I paid my royalty when I bought my iPod!”

Now if this royalty does not entitle iPod users to fill up their iPods with “stolen” music, then I have to ask: Exactly what does Universal want to be paid for?!

  1. Arbo Cide says:

    Isn’t this how Microsoft licenses Windows?

  2. forrest says:

    UMG just wants its cake and eat it too…

    The labels will continue to try to get every penny they can with litigation…

  3. Lauren the Ghoti says:

    Once again, effing lawyers.

    Your iPod ‘pirate royalty’ theory there is very nice, SN. Letting their overreaching greed blind them to the fact that they’re handing pirates a ready-made defense – priceless. An object lesson in the Law of Unintended Consequences, as it were.

    Riddle: You’re stuck in an elevator with Moqtada al-Sadr, Osama bin Laden and an entertainment lawyer. You have a gun, but only two bullets. What do you do?

    A: Shoot the lawyer twice, to make sure he’s dead.

  4. Pfkad says:

    The music industry has been spoiled by compliant media player manufacturers and a public all too willing to roll over. Their insatiable avarice will continue unabated until every tune ever produced will have its own encryption that will require the listener to pay a fee each time the tune is played. Every device will have a little button that, when pressed, will transfer a few cents from our bank accounts to the RIAA coffers. When the transfer is completed the tune will commence playing.

    Note to RIAA: This idea is my intellectual property. I expect heavy royalties.

  5. gquaglia says:

    If I was Jobs I would tell Universal to go scratch. What are they going to do, pull their music from the most popular download and player combo on the market. With the Zune they had leverage, with Apple they don’t. Apple isn’t going to bend over and spread like M$ did, they don’t need to.

  6. SN says:

    #5 “If I was Jobs I would tell Universal to go scratch…”

    I agree with you, but Jobs does not have a lot of leverage. The music industry still makes most of its money on CDs (remember those?!) And in fact the music industry makes more money selling/leasing ring tones than it gets from iTunes.

    ITunes is a total success, it totally dominates its market, but it’s still just a drop in the bucket in the eyes of the music industry.

  7. Roger M says:

    It just proves the UMG are crooks, and they have lawyers to legalize their crookism……
    It’s a pity M$ felt the urge to give in for blackmail just in order to get a foot inside the market.
    It’s like MADD demanding a fee from alcohol sales, or even car sales.

  8. Nick says:

    The music industry (appropriate term: these are *not* musicians and this *is* an industry manufacturing (very inferior) mass-market products) is hiding behind a moral fig leaf when it invokes the concept of “stolen music”. Really, “morality” is beside the point here. What’s moral is of absolutely no concern to the industry – except as an emotional lever to work on those who are deceived. Look at Sony’s rootkit: it used stolen code that had been filched and used in contravention of the license agreement the code had been distibuted under. The concept of ownership is neither here nor there to these people – or they wouldn’t have used stolen code – rather protecting what they see as *their* property no matter who else’s property rights are violated is what’s of concern.

    It’s no different to the Mob when they kill someone who moves into “their” drugs territory. It has nothing to do with morality: it is about power. What Universal deserves is the finger.

  9. Calin says:

    According to published reports, Microsoft ultimately agreed to hand over approximately $1 to UMG from the sale of each $250 Zune.

    So they’re gonna make what… 20 bucks?

  10. Mike says:

    Am I the only person who wonders why a musicians should expect to be perpetually paid for the relatively small amount of work that went into writing a song 20 years ago?

  11. SN says:

    #10 I agree. I personally think copyright should go back to a 15 year limit.

  12. Mucous says:

    #11 – I agree. You can indirectly blame Disney for most of this for their constant efforts to stretch copyright. Being an oldfart – the vast majority of the music I listen to is over 15 years old.

  13. funky says:

    #10, #11 I agree too but if only musicians _DID_ get the money. Artists make almost no money per song sold.

  14. JoaoPT says:

    the first Nirvana album lost some money, so the band was in debt and had to produce a second to the record company.
    Dunno if it’s true or not, but it’s close to what happens. Bands agree to some record deals because thay want the public awareness and expect to make money on live gigs. OTOH record companies are like casinos, no matter who looses, the public or the band, they always profit.
    Anyway, the most stuff in my mp3 player is podcasts, so i find this “tax” preposterous.

  15. dave says:

    you guys live in one screwed up country

  16. Grrr says:

    “just” repositories for stolen music?
    It’s possible to put only nonstolen music on ’em, or just nonstolen lectures… or self-written music tracks…
    In my opinion Morris comes off as clueless or (more likely) deceptive. The monopoly caving in and giving a cut from each sold Zune is yet another strong reason for me to avoid ever owning one.


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