European Commission Wary of Forcing Open Apple's iTunes

BRUSSELS, Belgium – European competition officials are wary about proposals to crack open Apple Computer's (AAPL) iTunes Web store to other music players, despite concerns shown by consumer advocates.

The French parliament is debating a new copyright bill that would require Apple to permit iTunes music to play on devices other than its iPod.

Scandinavian ombudsmen have said they may act, and others in the European Union are also contemplating doing so.

But Philip Lowe, director general of competition at the European Commission, said that although some member states believed there should be open access to all Web sites, he wanted to wait.

"We wouldn't at this stage regard this as an instance of major concern until we've seen further market developments," Lowe told reporters this week.

He said Apple had obtained its strong market position in open competition with many similar players, including some with their own Web sites.

PROTECTING FUTURE CONSUMERS?

One of the most outspoken government advocates on the issue is Norwegian consumer ombudsman Bjorn Erik Thon, who said he would act soon depending on how Apple responds to a letter the government had sent the company.

If Apple can require an iPod for songs via iTunes, then music, book and film companies might restrict their products to specific players too, he said.

"You will have a difficult situation for the consumer ... the consumer has to have four or five gadgets to have the availability of the content that he wants," Thon said in a telephone interview. "We want to look at the question before it is too late."

Thon cited Norwegian consumer law as saying contracts must be "fair and balanced," adding that the approach taken by Apple violated "basic consumer principles."

"We believe that it could be questioned [as] an infringement of rights. I have the right to use whatever I bought to what I want to use it for," he said.

Thon is waiting to see what Apple says when it replies to a letter from his department by a deadline this summer. He said his office was reviewing its options, but could bring charges against Apple in Norway's market court.

However, the question of using proprietary standards to exclude competitors is usually handled by antitrust enforcers. Even in Norway, a top antitrust enforcer is cautioning against hasty action.

"The market for legally downloadable music files is emerging," said Knut Eggum Johansen, director general of Norway's competition agency.

"This may be an argument for competition authorities to have a somewhat more hands-off approach," he said.

Johansen noted that many other firms produced portable music players, and music purchased via iTunes could be bought on CDs or other Web sites.