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|  | | | | Apple, Intel Tire Of Chips, Buy Lips? | | | | | found on Crikey
written by nairda3 and eewittme, edited by John (Plastic) [ read unedited ]
posted Fri 11 Apr 6:05am | | | | |
 | nairda3 writes us with a real good scoop if this deal turns out to be real: "Crikey.com.au recently reported that it 'doesn't break many global stories but here's one we got from a well-connected music industry insider in LA:
The world's largest chipmaker, wants to diversify into the copyright business and is negotiating to buy Warner/Chappell Music, the music publishing business of AOL-Time Warner, in a $US2 billion all cash deal to be announced in three weeks. The sale of Warner/Chappell, the second biggest music publishing company in the world by market share (to EMI Music Publishing), would represent one of the largest efforts to alleviate AOL-Time Warner's worrying $45 billion debt problem.
"If true, the acquisition would be the first effort by a large tech company to invest in the business of protecting content copyrights, following the recent agreement between major tech firms and Congress that they would self-regulate copyrights with customer hardware. The acquisition would leave Murdoch's News Corp one step closer to becoming the world's largest media company. Without their copyright business, AOL Time Warner could possibly merge its recorded music division with EMI and avoid the anti-trust concerns that it once experienced. The Inquirer and Guardian both quote Crikey on this one and eventually the truth of the matter will emerge. Ultimately, this rumour could likely become fact in view that Intel may now need content to leverage its just announced Trusted Platform Module. This platform seems to be build upon the new Trusted Computing Group's open standards that involve the tech industry's largest players. This group will perhaps end in failure as did the very similar SDMI initiative.
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| | | "What will possibly submerge is Intel's shareholder value when their encryption is inevitably cracked by unemployed (non-Indian) software engineers tinkering with their Intel chips and relive the open-season days of Napster. An alternative is Sun chief scientist Bill Joy's idea of having record labels 'ship me a box with all their music in it, and then I could license what I wanted from them.' Like Cringely's idea, mine is for free content no matter what its delivery and providing an efficient way for optional payments."
eewittme writes in with a similar story: "The Los Angeles Times is reporting that Apple Corp. may spend as much as $6 billion to acquire Universal from its flagging parent, Vivendi Universal. If completed, the deal would instantly make Steve Jobs the world's biggest music mogul, as well as completely reshape the record industry almost instantly. Visions of a Def Jam parent-owning Jobs wearing a fur coat and chatting on his cellphone as he drives his fly honeys around Cupertino in his Escalade are already dancing in my head. Universal's roster includes U2, 50 Cent, Shania Twain and Luciano Pavarotti. Can Ellen Feiss be far behind? The Times report says the deal's been in the exploration phase for a while, but a sale could come by April 29. All of this, the Times reports, would dovetail nicely with Apple's plans to roll out a new fee-for-song music download service, for which Jobs has already secured deals with four of the Big Five."
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[ more plastic... ] |
| | | | | | | 1. Re: The Beatles? | | | | by SacredGroundChuck |  | | | at Fri 11 Apr 6:31am | score of 2 interesting | | | | | | |
In the '80s, Apple got sued by the Beatles since the Fab Four thought the computer maker could be confused with Apple Corps. Part of the suit stipulated that Apple would never get into the recording business.
Legend has it this is where the Apple sound "sosumi" (say it slow) comes from when Apple began including microphones with its computers.
I hear Ringo Starr needs money really bad, and Yoko never met a buck she didn't like. Will there be another turf fight over the name Apple and what it can do? Or are the Fab Two (plus one) too busy/don't care/think they lost?
Either this is a bad idea (anything that dilutes Steve Jobs' attention even more than Apple and Pixar (where he flexes his muscles less) will get crappy computers as a result) or a brilliant idea (anything that distracts Jobs from making more Cubes). The download service I can see, but I wonder about owning Universal, which seems to crap up any company that owns it.
"Did you know that the human brain is the only computer in the universe made of meat?"
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| | | | | | 2. Re: The Beatles? | | | | by David Flores |  | | | at Fri 11 Apr 6:49am | score of 1 | | in reply to comment 1 | | | | | |
I don't think it will be a problem as long as Apple doesn't change the corporate names of the companies that it buys.
If Apple tried to change the name of Universal Music to Apple Music, then they most certainly could get sued by Apple Records, the Beatles' publishers.
At any rate, Apple has produced music capable machines since the Apple II. I believe that court cases have already established that there is no real danger of confusion between Apple Computer and Apple Records on this point.
GAFB and GAFB2
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| | | | | | 3. Ugh | | | | by 0tim0 | | | | at Fri 11 Apr 7:15am | score of 1 | | | | | | |
As an Apple shareholder. And as someone who was planning to buy his first Mac soon. I sure hope this doesn't happen. I would vote my meager shares against this one.
Crimniny, Apple has great technology, but they're lagging waaaay behind in market share. I thought their cash reserves and the new IBM PowerPC chip would keep them in the game long enough to get some traction. But now they want to blow those cash reserves — on a music company?! This is not the direction I'd hoped they were going.
All I can say is: Ugh.
Does anyone see a good business strategy I'm missing here?
--t
"Men are apt to mistake the strength of their feeling for the strength of their argument." -William E. Gladstone
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| | | | | | 4. Re: Ugh | | | | by dolohov | | | | at Fri 11 Apr 7:37am | score of 1.5 compelling | | in reply to comment 3 | | | | | |
Does anyone see a good business strategy I'm missing here?
Think of it this way: Apple sells the iPod, sales of which thrive according to the ability of its potential owners to get their hands on MP3 music. If Apple owns a large quantity of music — particularly good, hard-to-find music — then they can release it electronically. The music itself will (in theory) continue to generate easy revenue if distributed online, and greater (not to mention more legal) availability of MP3 music will push sales of the iPod. Sounds like a decent business strategy to me.
(This was probably mentioned in the LA Times article, but I don't have a registration there and don't want to register from work)
"Carthago delenda est" -- Cato (in the world's first .sig)
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| | | | | 6. Re: Ugh | | | | by rombuu | | | | at Fri 11 Apr 8:54am | score of 1 | | in reply to comment 4 | | | | | |
Let's see here... so Apple blows $6 Billion on a music company. Let's assume they make $50 on selling an iPod. Hey, they only have to sell 120,000,000 iPods above and beyond what they'd sell anyway before this even makes sense. Or basically, they have to get a little less than 1 in 2 Americans to buy an iPod — and then the might start making a profit on this deal. And that doesn't discount them having to keep the music compnay going, the fact Apple doesn't have any particular skills in that industry, etc.. etc...
I think its a dumb idea, and doubt it is ever going to happen anyway. Maybe I'm missing something though... (Although I do have to admit, I have a Nomad Jukebox — but I really really do want an iPod).
http://drlunch.com The site that helps you decide where to go to lunch!
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| | | | | 7. Re: Ugh | | | | by MiceHead | | | | at Fri 11 Apr 9:30am | score of 1 | | in reply to comment 6 | | | | | |
Let's see here... so Apple blows $6 Billion on a music company. Let's assume they make $50 on selling an iPod. Hey, they only have to sell 120,000,000 iPods above and beyond what they'd sell anyway before this even makes sense.
An unintended(?) side-effect of your argument is that music publishers will make no money. You're too pessimistic. I know at least two people who will buy a CD (possibly one each) within the next 12 months.
=MiceHead - The Stock Market for the Next 100 Years
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| | | | | 8. Re: Ugh | | | | by morphinex | | | | at Fri 11 Apr 9:42am | score of 1 | | in reply to comment 6 | | | | | |
I think it is a dumb idea also, but with the characters involved, that gives me every reason to believe that it will happen.
Steve Jobs is a gravely misguided little man who has had exactly one good idea in his entire life. His ratio of bad ideas to good ideas is so high that he is lucky to still be alive, and yet he is the head of a major American corporation.
This deal might go through simply based on the force of Jobs's will. There is no reasoning with Jobs: what Steve wants Steve wants. For the reasons you pointed out above, the merger of Apple and Universal is likely to bring nothing good to either partner, which is exactly why Jobs wants to do it. Jobs will do anything to cement his title as visionary, the more hairbrained the better.
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| | | | | 9. Re: Ugh | | | | by derch | | | | at Fri 11 Apr 10:47am | score of 2 compelling | | in reply to comment 8 | | | | | |
Disclaimer: I'm a Mac user, and I like Jobs.
I disagree with your characterization of Jobs as "a gravely misguided little man who has had exactly one good idea in his entire life." I don't want to get into a long flame war of why he is or isn't, but I would like to point out that beside his "one good idea" (assuming you meant the original Apple or the Mac), he rescued Apple from itself, pushed the development of OS X (further rescuing Apple), and had the good sense to buy Pixar in 1986.
He may have a giant ego, a Hellish temper, and be a vegan, but give him credit for having more than one good idea.
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| | | | | 10. Re: Ugh | | | | by morphinex | | | | at Fri 11 Apr 11:35am | score of 1 | | in reply to comment 9 | | | | | |
I used to be a Mac user, and I used to think Jobs was great.
I disagree that Jobs rescued Apple from itself. I did indeed credit him with one good idea, the original Mac, and what rescued Apple was that same idea, except in teal: the iMac.
As for the development of OS X, I happen to think this was a horrible idea, and is one of the reasons I switched from the MacOS to Windows. OS X looks, feels, and acts just like windows (or at least, not like the MacOS), and it requires a $1500 machine to run it. I built a $650 PC that runs windows just fine. Why should I pay $1500 for an Apple that doesn't run the MacOS? Also remember that Jobs made a ton of money when he forced Apple to buy NeXT, which happened to be another one of his bad ideas (and NeXT is where the Cube idea germinated).
By all accounts, Jobs almost ruined Pixar. It was a success despite his involvement, not because of it. He terrorized and alienated the employees, and then took all the credit when the company succeeded.
Reading a number of biographies of Jobs is what convinced me that he is a wart not only on the computer industry, but on humanity itself. If you'd like the titles, send me a message and I can dig them up for you.
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| | | | | 16. Re: Ugh | | | | by Bocephus | | | | at Sun 13 Apr 10:21am | score of 1 | | in reply to comment 7 | | | | | |
An unintended(?) side-effect of your argument is that music publishers will make no money.
This is a very realistic assumption as far as Universal is concerned. Content creation is an unbelievably shitty business.
insert Fight Club quote here to demonstrate Freethinking and Nonconformity
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| | | | | 13. Maybe not so crazy | | | | by bigdumbjerk | | | | at Fri 11 Apr 2:52pm | score of 1.5 astute | | in reply to comment 3 | | | | | |
If Apple acquires Universal then they acquire a very influential seat at the table that decides the future of music distribution. i.e. they can influence copy protection schemes, digital rights management, etc.
As a company that has tried to differentiate itself from the mainstream (i.e. Microsoft) they seem to have tried to market themselves as being a bit more friendly to the notion of fair-use. Considering that they have a small portion of the overall market of PCs it is very much in their interest to try and prevent Microsoft achieving a lockdown on drm. (Only trusted — i.e. Palladium — operating systems will be able to play medai because all others may enable piracy.)
So, since Apple doesn't have much hope of influencing drm (and such things) through its market share of the PC industry, they must go to the source of the movement to lock-down content.
Whether this strategy would work for Apple is a different matter. Whether this would actually result in less erosion of end-user fair use rights is subject to debate. (How benevolent is Apple, really?)
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| | | | | | 11. on a related note.... | | | | by postbear | | | | at Fri 11 Apr 1:33pm | score of 1 | | | | | | |
screw the big five.
and no, i'm not going to launch into a rant about the inferior quality of the product foisted upon us by globocorp's mcmusic division, as tempting as that might be. i guess the best model for the music business in the modern world is rather more hands-on, personal and cooperative than the methods of the multinationals.
go indies.
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| | | | | | 12. Def Jam parent-owning Jobs wearing a fur coat | | | | by Pravda | | | | at Fri 11 Apr 2:44pm | score of 1 | | | | | | |
That is a GREAT thought for a friday afternoon!
I think that this has less to do with business sense and more with Jobs' ego.
Let's look at what he's done:
1. Apple — one of the most successful tech companies in the Valley in the 80s.
2. Next — failure.
3. Pixar — Fantastically successful boutique movie house (although he didn't have much to do with them, admittedly).
4. Apple — rescued the company (with a little help from Microsoft), but what has he done with them lately? Apple's been pretty stagnant (in terms of market share and any significant products — the Cube was a flop, and the G4s haven't been updated in years. There are the TiBooks, but for all the congratulatory masturbating that Mac people have been doing about them, there's nothing revolutionary about them.)
I'm thinking he's looking for the next big gratifying thing. Just like CEOs of more traditional companies get addicted to making deals — taking over, merging, etc, he's addicted to risk.
For Intel or Apple, this is a Very Bad Idea. Intel is terrible at making sidebusinesses work — witness their MP3 player or software division (that did server software). They make chips, they make chips better than anyone else in the world, and they do not need distractions like a music business.
Apple, well I don't know...they have a notoriously short attention span...
Seen in the subQ: "For once I have to +Pravda. Scary. - Anonymouse Savant"
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| | | | | | 15. Re: Def Jam parent-owning Jobs wearing a fur coat | | | | by keenduck | | | | at Sat 12 Apr 8:29am | score of 1 | | in reply to comment 12 | | | | | |
As others have mentioned upthread, OS X is a significant product. Maybe even revolutionary. You need only look at Safari to see the direction Apple seems to be heading toward. Leveraging open source to create their own software, minimizing work while still making excellent products.
I certainly think it's possible for Apple to make this work. By purchasing Universal, they are acquiring a deep catalog (including U2), most of which I doubt has been offered over the internet at the record companies' tentative attempts to remake their distribution channels.
I don't know how successfully this may work out, but I can say there have never been as many Apple products I want to own than at the present. Once this Dell laptop wears out, I'll go out for a TiBook. And I keep lustfully looking at iPods. Yes, I'll acknowledge I'm not buying anything at the moment, but even keeping the brand in my mind is a good deal for them.
As for Intel's MP3 player division, it's a pity they shut it down, because they were pretty decent. Compared to competitors at the time, they were well engineered and relatively cheap. I suspect it was a marketing problem more than anything.
You missed a good part ... What? ... She was masturbating ... Where?!
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| | | | | | | 19. Extension of the iLife | | | | by Theeggman98 | | | | at Sun 13 Apr 4:09pm | score of 1 | | | | | | |
I see this as an extension of the iLife theme apple has been pushing. If Apple buys Universal they will instantly have access to music that they can then distribute to their apple customers(through iTunes?). Maybe the next time you buy your mac you will also be buying a years worth of access to Universal music. With an option to pay some sort of a fee after that. Apple doesn't just want to sell you software and hardware they want to sell you their iLife. Personally I see this as a risk that could be worth taking.
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| | | | | | 20. This will gimp my karma... | | | | by I Love The RIAA | | | | at Sun 13 Apr 6:03pm | score of 1 | | | | | | |
Apple has only been good at two things in the last decade+. The first is developing fabulous revolutionary technology and watching their competition capitalize on it. The second is taking a phenomenal company and running it into the ground with nothing but arrogance. I don't see Apple changing much, and don't expect them to treat acquisitions any differently.
Intel used to be a stellar company. With information from close associates working at high levels in the company I've become leary of Intel- its lost the laid back work environment that made it popular, and is quickly becoming mired in beurocratic bullshit. Diversifying their market interests into politically charged companies will hardly help IMO.
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| | | | | | 21. Sorry to double post. | | | | by I Love The RIAA | | | | at Mon 14 Apr 12:50am | score of 1 | | | | | | |
I quite seriously couldn't go to sleep and I was thinking about this article. To save time:
"This merged entity would control songwriter catalogues that ranged from Bob Dylan to Lenono (John Lennon's songs) to JoBeTe (the entire Motown Song Catalogue) to Diane Warren (multi-million selling contemporary songwriter) to the Gershwins — a catalogue of over 2.4 million songs.
Intel's purchase would mark the first large scale effort of a tech company to buy into the entertainment copyright business, and follows the recent agreement between major technology firms and the US Congress that they would self-regulate the copyright of products on their hardware. In particular this relates to the downloading of music into computers and the rights of consumers to make copies of their products for personal use on handheld units and PDAs."
So Intel buys the company, they get the songs, and the right to protect the distribution. Perhaps this is a more sinister move than it seems...
Buy an Intel and get access to 2.4 million songs you won't find anywhere else, literally.
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