iTunes drama: What exactly did Steve Jobs say to Sony?


You’d think that the music industry would be grateful for Apple, which, with the launch of the iTunes Store in 2003, pretty much saved its keister. Not so, according to the old gray lady! In the negotiations leading up to tiered pricing and the removal of DRM on iTunes, Steve Jobs and Sony’s music chairman, Rolf Schmidt-Holtz, got into a little bit of an argument over the phone, which the paper described as “tense.” (Knowing the New York Times, “tense” probably means some pretty salty language, like in a Tarentino film.) It seems the Sony man wasn’t satisfied with the timing of the new pricing structure, and made his opinion known to Jobs on Christmas Eve. Jobs, as is his wont, had none of it, and thoroughly laid into Mr. Sony.

Needless to say, Jobs got his way, and Sony’s DRM-free music launched with the rest of the major labels’.

Now, why did Apple let the companies get away with their tiered pricing scheme? One word: iPhone. Apple, rightly, saw cellphones as the future for music distribution, and wanted to ensure that iTunes+iPhone had a good start. (You’ll also note Nokia’s Comes With Music.) Get enough people using their iPhone to download off iTunes, of which Apple gets approximately 20 cents per 99-cent song, and you’re golden. Then, for better or worse, the music labels have to deal with Apple everywhere they turn.

(That the music industry desperately wants something like Amazon MP3 to take off shouldn’t surprise anyone.)

It’s like, iTunes is pretty much up there with Q-Tip, Kleenex and Xerox as being synonymous with its product. Digital music = iTunes.