A Federal District Court ruling against Apple in the eBook price-fixing case yesterday is likely to reverberate throughout the digital media business even as Justice Denise Cote's ruling is appealed by Apple, and even as the judge sought in her 160-page decision to limit the scope of the ruling.
According to Paul Sweeting, Content Licensing's Chief Contributing Editor, Apple used the same strategy to enter the music and book markets, and is seeking to do the same now with its Internet radio and streaming music services. Music licensing agencies ASCAP and BMI are already at loggerheads with online radio service Pandora and, notes Sweeting, the ruling against Apple in the eBooks case could provide Pandora the opening to argue that Apple and the music publishers engaged in a conspiracy to raise the price of music publishing performance rights to the detriment of Pandora.
The new ruling could also delay any effort by Apple to enter the subscription video streaming business – a move many analysts have regarded as inevitable – by making it harder for Apple to engage in simultaneous negotiations with TV rights owners. More generally, the ruling, if it stands, could leave rights owners leery of any appearance of negotiating en masse with potential licensees.
Content Licensing will offer a complete case analysis in its July 15 issue.