Wednesday, March 22, 2006

France and iTunes

The French National Assembly has voted in favour of legislation that will require companies like itunes to open their standards, allowing other music players to play itunes music, and allowing other providers to make music available in ipod format.

The Financial Times published an editorial today condemning the legislation. FT argues that it is the business of market competition, not government, to decide whether open standards are used - that, if consumers want open standards, they will buy from companies that have open standards.

For consumers, the issue of open standards is only one of a number of factors considered in purchasing decisions. Consumers cannot be relied upon to put their purchasing power behind open standards and competition; that is how monopolies happen. Consumers will likely prefer open standards and competition, but that is no guarantee that companies offering open standards will be able to offer a product that is, in the balance of all factors consumers consider, the most competetive.

Governments are able to make longer-term structural decisions about markets and competition that are not considered by consumers visiting itunes to buy the latest hit.

One of the likely results of open standards in content provision is more competition. One of the effects of competition in content provision could be lower prices for content. Lower prices could lead to consumers placing a lower value on content. The Financial Times itself is a content provider. Just an observation.

No comments:

Post a Comment