iLounge

In a rare move, Apple CEO Steve Jobs as written an open letter on Apple’s digital rights management (DRM) system used on the iPod and iTunes. In the letter, Jobs explains why Apple has implemented its FairPlay DRM technology, and explores three alternatives for the future—continue the current DRM scheme, license FairPlay or abolish DRM entirely. Jobs’ letter is in response to mounting pressure from European countries which say Apple is forcing limits on consumers. Jobs says that persuading the major record companies to allow iTunes and other stores to sell music DRM-free is the right move. He says Apple would embrace selling this open music “in a heartbeat.” A portion of the letter is below, but clicking through to read the entire letter is highly recommended.

Imagine a world where every online store sells DRM-free music encoded in open licensable formats. In such a world, any player can play music purchased from any store, and any store can sell music which is playable on all players. This is clearly the best alternative for consumers, and Apple would embrace it in a heartbeat. If the big four music companies would license Apple their music without the requirement that it be protected with a DRM, we would switch to selling only DRM-free music on our iTunes store. Every iPod ever made will play this DRM-free music. [...]

So if the music companies are selling over 90 percent of their music DRM-free, what benefits do they get from selling the remaining small percentage of their music encumbered with a DRM system? There appear to be none. If anything, the technical expertise and overhead required to create, operate and update a DRM system has limited the number of participants selling DRM protected music. If such requirements were removed, the music industry might experience an influx of new companies willing to invest in innovative new stores and players. This can only be seen as a positive by the music companies.

Much of the concern over DRM systems has arisen in European countries.  Perhaps those unhappy with the current situation should redirect their energies towards persuading the music companies to sell their music DRM-free.  For Europeans, two and a half of the big four music companies are located right in their backyard.  The largest, Universal, is 100% owned by Vivendi, a French company.  EMI is a British company, and Sony BMG is 50% owned by Bertelsmann, a German company.  Convincing them to license their music to Apple and others DRM-free will create a truly interoperable music marketplace.  Apple will embrace this wholeheartedly.

Prudential Securities research analyst Jesse Tortora believes the next iPod could “include a wider touch-screen, Wi-Fi and GPS.” He made these comments Monday in relation to a research note he released to clients and reported on by the International Business Times. Tortora speculates this overhauled iPod—especially as relates to the built-in GPS—will “position the iPod as the central hub for all digital content (music, movies, GPS) in automobiles.” Apple may also look to veer away from hard drive-based iPods, the research analyst speculated, by instead choosing “NAND flash as soon as late ‘07.”

Doug Kass of The Street.com says Google CEO Eric Schmidt could be a temporary replacement for Apple CEO Steve Jobs “should the options-backdating issues intensify at legal levels.”

Apple’s iTunes Store has now posted the extended highlights package from Super Bowl XLI, as well as full coverage of the game. Both are priced at $1.99 each.

Signaling it has no plans to give up its claim to the iPhone trademark, Cisco Systems this week paid for a full-page ad in the New York Times to promote its iPhone.

The Joy of Tech online comic has posted a humorous take on future iPhone accessories, including the Newton Shell Case, Inflatable iPhone Booth, and iPhone Stress Pills.

Using its clout as the world’s biggest seller of DVDs, Wal-Mart has launched an online movie download store with films from all six major Hollywood studios. The Wal-Mart Video Downloads store currently sells about 3,000 movies and TV shows from Walt Disney, Warner Brothers, Paramount, Sony, 20th Century Fox, Universal, Comedy Central, CW, FX, Logo, MTV and Nickelodeon. The Windows Media-based store only works with Microsoft Windows and videos are not compatible with the iPod. Download prices will be $12.88 to $19.88 on the day of the DVD release. Older movies will start at $7.50, while TV shows will sell for $1.96 an episode. Apple’s iTunes Store, which only offers movies from Walt Disney and Paramount, charges $12.99 for movies when pre-ordered and during the first week of sale, and $14.99 afterward.

Fastmac has expanded its “Just Say No To Crack” iPod LCD program to include service for iPod minis. The service, which offers same-day iPod LCD screen replacements, is already available for 4G and 5G iPods and iPod nanos. The program offers repair and replacement of scratched or cracked iPod LCD screens, either as a Do It Yourself (DIY) kit with tools and instructional videos, or via a same-day mail service. Fastmac uses only Apple original parts to “guarantee quality as well as fit and compatibility.” Prices start at $30.

Apple is urging iTunes users to hold off on upgrading their PC to Microsoft’s new Windows Vista operating system. “iTunes 7.0.2 may work with Windows Vista on many typical PCs. Apple recommends, however, that customers wait to upgrade Windows until after the next release of iTunes which will be available in the next few weeks,” Apple says in an online support document. Apple said it is preparing to address a number of iTunes compatibility issues in the next release of the software. The company last week released iTunes Repair Tool for Vista 1.0, a software update to fix some reported issues.

Apple Inc. and The Beatles’ Apple Corps said today that they have ended their ongoing trademark dispute and have entered into a new agreement over the use of the Apple name. Under the new agreement, which replaces one from 1991, Apple Inc. will own all of the trademarks related to “Apple” and will license certain trademarks back to Apple Corps. The companies said the terms of settlement are confidential. Apple Inc. won a trademark lawsuit brought on by Apple Corps last year, with a UK judge ruling that the company could continue using its logo on the iTunes Store.

“We love the Beatles, and it has been painful being at odds with them over these trademarks,” said Apple CEO Steve Jobs. “It feels great to resolve this in a positive manner, and in a way that should remove the potential of further disagreements in the future.” Neil Aspinall, manager of Apple Corps said, “It is great to put this dispute behind us and move on. The years ahead are going to be very exciting times for us. We wish Apple Inc. every success and look forward to many years of peaceful co-operation with them.”

Update: We’ve posted an Editorial discussing the potential impact of the new agreement.

In addition to releasing new colors for the second-generation iPod shuffle, Apple has quietly updated two additional iPod products: the iPod 5G- and nano-compatible iPod Radio Remote, and the iPod AV Connection Kit. Released in January of 2006, the original iPod Radio Remote included a shortened pair of Apple’s classic iPod Earphones, and a combination remote control and FM radio tuner, the latter part highly similar in design to the second iPod shuffle. The updated Radio Remote (shown) now includes Apple’s latest iPod Earphones, which can be seen through the front of its clear plastic package. Apple’s iPod AV Connection kit retains the same major pieces as its predecessor - a Universal Dock, iPod AV Cable, iPod Dock Connector to USB Cable, Apple Remote, and USB Power Adapter - but updates the USB Power Adapter with the later, smaller September 2006 component. iLounge checks show inconsistent in-store availability of the Radio Remote and AV Connection Kit - some third-party retailers and Apple Stores have the updated accessories, while others do not. Thanks to iLounger TheWho61 for the tip.

Apple recently filed for a patent for a hot unpluggable iPod. “The filing lays out improved techniques for rendering a peripheral—such as an iPod or iPhone—removable from a host computer without the user first having to perform preparatory unmounting actions through software.”

iConcertCal is a new iTunes plug-in that “monitors your music library and generates a personalized calendar of upcoming concerts in your city.” The plug-in is available for both Windows and Mac OS X.

A senior Microsoft executive in charge of the new Zune digital media player is leaving the company. Microsoft said Bryan Lee, corporate vice president at Microsoft’s entertainment and devices division, is leaving the company to “pursue personal interests.”

Game developer Red 5 Studios is sending out customized iPods to potential new employees. “They are on some sort of recruiting blitz, trying to nab devs from elsewhere. Included with the iPod is a personal web link tailored to the recruit, with details about the job they are hoping the recruit would be interested and background on the company.” [via Airbag]

In a sign that Sony has surrendered to the overwhelming popularity of the iPod, the company has introduced its first iPod-specific audio system. The Sony iPod Audio Docking Station CPF-IP001 ($250) is a compact unit for all dockable iPods. The system’s S-Master amplifier and external subwoofer “provide superior sound while the compact and lightweight design allows you to place this docking station in virtually any room of your home,” according to Sony. The system also comes with a wireless remote and a line input for use with other devices. [via TUAW]

Disney CEO Bob Iger said yesterday that his company has now sold more than 1.3 million full-length movies on Apple’s iTunes Store. In an interview with the Financial Times, Iger said digital distribution was “creating more consumption of media” and dismissed fears that online movie sales would cannibalize DVD sales. “The message that we deliver to our traditional [retail] partners is that the pie is getting bigger,” Iger said. Disney began selling movies on iTunes in October.

Apple late Thursday posted iTunes Repair Tool for Vista 1.0, a software update that fixes iTunes issues reported by new Windows Vista users. According to widespread reports, music purchased from the iTunes Store could not be played in iTunes on the new Microsoft operating system released this week. Users reported that they received a message saying their computer was not authorized to play the purchased tracks. “The iTunes Repair Tool for Vista 1.0 will repair permissions for important files required by iTunes to play your iTunes Store purchases,” Apple states in the brief release notes.

V-Moda today unveiled new colors of its VIBE noise-isolating earphones. One of interest to iPod owners is the new Red Roxx model. The red earphones are designed to pair with the iPod nano (PRODUCT) RED Special Edition and will be available exclusively from the online Apple Store, Apple retail stores, and at V-Moda’s website throughout February. These earphones, V-Moda claims, provide “a precise balance of rich bass, warm mids and unprecedented clarity… and are fashionable accessories.” The Red Roxx earphones are priced at $101.

Nike is offering a new cold weather cap designed to hold and control an iPod nano. “Move, groove, and stay warm in the Nike Men’s Soft Shell Therma-FIT Hatphones Cap,” says the company. “This cozy, comfortable skullcap features full functional Nano click wheel controls through a power mesh window in back so you can keep moving while mixing up your music.” It’s unclear whether the cap will hold a nano with a Nike+iPod Sport Kit adapter attached. The Nike Hatphones Cap sells for $60 and is available in black, grey, blue and red.

Vaja has introduced its latest iPod case—the Caddie case for fifth-generation iPods. Made of high quality Argentine leather, the Caddie case (from $110) is available in several different colors and can be customized with an embossed name or logo. The Caddie case features a screen protector, access to all controls and ports, and comes with a matching Caddie leather bag for storing the case and iPod.

In a joint statement from Apple and Cisco, the companies said today that negotiations over the iPhone trademark had resumed, and that legal proceedings will be delayed until Apple can respond to Cisco’s lawsuit. “Apple and Cisco have agreed to extend the time for Apple to respond to the lawsuit to allow for discussions between the companies with the aim of reaching agreement on trademark rights and interoperability,” the brief statement reads. As previously reported, Cisco, which claims to own the iPhone trademark, sued Apple last month for calling its new mobile phone the iPhone. Apple and Cisco had reportedly been in licensing talks, but Apple had ended them without reaching an agreement. Apple recently called Cisco’s lawsuit “silly.”

The San Jose Business Journal reports: “Apple has been ordered to pay the legal fees of online journalists after an unsuccessful attempt by the company to make them reveal sources of information used in stories. Apple will have to pay more than $750,000 to lawyers who defended the journalists.”

According to a survey by ChangeWave Alliance on trends for the digital living room, the Apple TV has the best chance of mass market acceptance among media centers. “Apple has shown the ability both to innovate and simplify its designs to consumers,” said one respondent. “iPod is opening channels to Apple in a big way.” Another said, “They understand the biggest impediment to adoption is that people hate complexity, they just want to plug in and play.”

The Secret Diary of Steve Jobs, a humorous blog written by “Apple CEO Steve Jobs,” appears to be shutting down. “Well my friggin lawyers are advising me that I will have to shut down this scandalous old blog,” writes Fake Steve. “Details not worth going into here. Someday I’ll be able to explain. Maybe I’ll write a book or something.”

Creative Technology this week reported second-quarter net income of $92.2 million, largely due to a licensing payment from Apple. “The big jump in net income during the second quarter came largely from a US$100 million licensing payment received from Apple. That payment contributed $82 million in net income, Creative said. Excluding the Apple payment and investment gains, Creative’s net income for the second quarter was $9.9 million.”

Malachi and Company has introduced a new generation of iPod-ready fitness shirts under the name SyncWear (previously PodWear). The $34 shirts, made from a lightweight polyester material, sport two side-by-side inner pockets; one to hold an iPod nano (or similar flash MP3 player) and the other to hold items like a gym card. Cord management is handled by two fabric loops, one on the right side between the pocket and armpit and one near the right collarbone area.

The National Football League has announced that it will make highlights from this year’s Super Bowl available for purchase the following day at the iTunes Store. The Super Bowl highlights video will be sold along with a 90-minute video of the NFL’s coverage of the Super Bowl. Both videos will be sold for $1.99. “It’s another way for fans to relive the Super Bowl before they get to the water cooler,” said Brian Rolapp, the NFL’s vice president for media strategy. Video highlights from the NFL’s regular season and playoff games have been available from iTunes since September.

Apple plans to launch iTunes Store video sales this spring in Europe, according to Luxembourg’s economy minister. “Apple is going to extend its electronic retail activities in Luxembourg by launching this coming spring its iTunes video platform for the sale of videos in Europe,” said Luxembourg economy minister Jeannot Krecke. “It will provide full-length television series in various European countries.” Krecke said Apple has been in discussions “for several months” with Luxembourg authorities. Apple reportedly chose the small country because VAT is low for online services by European standards. Other U.S. companies, such as Amazon and AOL, have also set up their European operations in Luxembourg. Apple has been selling video content in the U.S. since October 2005. [Thanks, MacGeneration.]