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Martian · 07-06-2006, 07:21 PM

Apple has less to lose. France is one market in one region. I don't know how sales break down because I'm too lazy to do the necessary research. I can take a pretty good guess though that Apple makes the bulk of it's sales in the North American and Asian market. Losing one European country isn't going to hurt them too much.

France, on the other hand, isn't going to be so willing to lose Apple. Consider that all of Apple's hardware is imported, which means if Apple bails, they lose all the tariffs and tax revenues, along with a hit to their IT market. Imagine all the Apple specialists over there who'd be forced to go to Germany, Spain or Belgium for work. These are people who are no longer working and being taxed in France now. Granted, I can't imagine that would end up being too big a piece of the nation's revenue or IT market, but it's obviously enough to make the folks at the top back down.

Negotiations like this, be they on a one-to-one or international level, always follow one simple rule. The party who's willing to walk away is the one who'll win. It looks like in this case Apple was and France wasn't.

It makes sense for Apple to want to maintain market share with the iPod. Really, how many people in the grand scheme of things pay for songs? Your average, morally ambiguous consumer will generally take the cheaper option if quality isn't a major concern and with alternatives like the bittorrent or soulseek network flourishing it really isn't right now. Soft sales, therefore, become a capped market. The only people who are going to pay for copies of songs (especially for songs that are under DRM restrictions, when the free alternatives are not) are going to be those who can't afford or are not willing to be involved with shady activities. The rest of the world isn't as likely to care. Hardware, therefore, is where Apple will make it's sales. And by forcing the iPod, which is by far the dominant player at the moment, to be used exclusively with iTunes, Apple can control both sides of the equation. Giving away their proprietary controls uncouples one from the other and effectively destroys Apple's ability to control the market. For the end user, that'd probably be a good thing, but Apple is only really concerned about the end user when it affects their bottom line.

Again, such is capitalism. The worst form of market, except for every other that's been tried.

07-06-2006, 07:21 PM	#4 (permalink)
Martian Young Crumudgeon Location: Canada	Apple has less to lose. France is one market in one region. I don't know how sales break down because I'm too lazy to do the necessary research. I can take a pretty good guess though that Apple makes the bulk of it's sales in the North American and Asian market. Losing one European country isn't going to hurt them too much. France, on the other hand, isn't going to be so willing to lose Apple. Consider that all of Apple's hardware is imported, which means if Apple bails, they lose all the tariffs and tax revenues, along with a hit to their IT market. Imagine all the Apple specialists over there who'd be forced to go to Germany, Spain or Belgium for work. These are people who are no longer working and being taxed in France now. Granted, I can't imagine that would end up being too big a piece of the nation's revenue or IT market, but it's obviously enough to make the folks at the top back down. Negotiations like this, be they on a one-to-one or international level, always follow one simple rule. The party who's willing to walk away is the one who'll win. It looks like in this case Apple was and France wasn't. It makes sense for Apple to want to maintain market share with the iPod. Really, how many people in the grand scheme of things pay for songs? Your average, morally ambiguous consumer will generally take the cheaper option if quality isn't a major concern and with alternatives like the bittorrent or soulseek network flourishing it really isn't right now. Soft sales, therefore, become a capped market. The only people who are going to pay for copies of songs (especially for songs that are under DRM restrictions, when the free alternatives are not) are going to be those who can't afford or are not willing to be involved with shady activities. The rest of the world isn't as likely to care. Hardware, therefore, is where Apple will make it's sales. And by forcing the iPod, which is by far the dominant player at the moment, to be used exclusively with iTunes, Apple can control both sides of the equation. Giving away their proprietary controls uncouples one from the other and effectively destroys Apple's ability to control the market. For the end user, that'd probably be a good thing, but Apple is only really concerned about the end user when it affects their bottom line. Again, such is capitalism. The worst form of market, except for every other that's been tried. __________________ I wake up in the morning more tired than before I slept I get through cryin' and I'm sadder than before I wept I get through thinkin' now, and the thoughts have left my head I get through speakin' and I can't remember, not a word that I said - Ben Harper, Show Me A Little Shame