Forbes Prints Insanely Self Serving Attack on iTunes by MediaNet CEO Alan McGlade
September 22nd, 2007
Daniel Eran Dilger
Forbes, best known to many readers as the soapbox Daniel Lyons used to promote–perhaps unwittingly–a pro-Microsoft agenda backing SCO and vilifying Linux and open source, has taken another opportunity to present outrageously false information serving the interests of Microsoft: an impassioned outcry of rage over the success of iTunes.
This time, rather than using a journalist Forbes gave its bullhorn to Alan McGlade, the CEO of MediaNet Digital. Although not identified as such by Forbes, his company supplies the music library behind MTV’s Urge, Yahoo, FYE, and the Zune Marketplace, all of which are Microsoft’s partner Windows Media DRM stores. I wonder if he has anything bad to say about Apple and its music business?
[Daniel Lyons: Fake Steve Jobs and the SCO Shill Who Hated Linux]
Tear Down This Wall!
In a rapturous plea to abandon Apple, McGlade complained that “In a flat, digital world, walls don’t need to be torn down. Thanks to online file sharing and social networking, people are able to go over, under and through walls.”
No doubt the company stocking Microsoft’s Windows Media stores would like nothing more than an open playing field where everyone could compete. Oh wait, companies already can. Stores like eMusic profitably sell MP3s online next to iTunes, and Apple has made no efforts to erect barriers to sales of open music on the iPod. Apple does stop DRM providers from using the iPod, and this incenses DRM providers like Real and Microsoft.
The other problem for companies selling egregious DRM is that customers hate their business models. People don’t want to pay to rent music, or they would be. They have had lots of opportunity to do so.
McGlade is bitter to have partnered with Microsoft–the most deviously anticompetitive and monopolistic company in technology and the biggest proponent of the most restrictive types of DRM–only to lose out in the music business to more permissive and liberal stores like Apple’s iTunes and the popular iPod, which will not support anti-consumer Windows Media DRM at all.
[Of Apple And Oranges - Forbes]
McGlade Cries Over His Own DRM Failure.
McGlade weeps out a portrait of his own failure, writing, “How is it then that one of the world’s most innovative technology companies has managed to erect its own exclusive, and so far impregnable, kingdom? A relatively small percentage of world music sales occur through digital downloads. But, those that do, happen mainly through iTunes, Apple’s online music store.
”It’s hard to remember any one company establishing such total control over a segment of our culture as Apple has on digital music. The iPod accounts for 70% of personal music player sales, while iTunes is estimated to direct more than three-quarters of all music downloads.“
Yes it is easy to forget about Microsoft when you are bound to the company’s teat. With some objective perspective, perhaps even McGlade could recognize that he bought into a deal that was ‘guaranteed to win’ because of Microsoft’s 97% monopoly hold over computers worldwide.
But he lost, and miserably so, as he points out. Now he wants the market to pay him without having to compete. McGlade expects the world to ‘correct’ his defeat because he is simply owned profits for offering DRM in partnership with Microsoft. Sorry McGlade, you have to earn your money.
Double Locked Down!
”Apple has maximized its dominance of the digital music market with a double lockdown.“ McGlade says, but leaves it somewhat unclear what either of those locks are.
”The combined clout of iPod and iTunes is mutually reinforcing and gives Apple enormous marketing leverage.“ Is the iPod at all locked to iTunes music? No, in fact we know, as McGlade earlier pointed out, that downloads only amount to a small percentage of music on all music players, including iPods. Most music comes from users’ own CDs.
McGlades’ comment is particularly saturated in hypocrisy because the stores he represents–as a competitor to iTunes–are mostly geared toward subscription plans, and therefore lock users to to a specific store and lock them to a monthly fee.
That’s the real double lock down, but McGlade doesn’t want his readers to think about that. He just wants their money.
Remember: Apple is the New Microsoft.
McGlade then describes how Apple is defining popular music, and that it has the power to promote music on the front page of iTunes. He warns that ”as digital devices diversify [through the imminent adoption of Microsoft-partnered players]… music lovers will inevitably seek digital music from a multiplicity of sources [selling music from MediaNet].“
This makes lots of sense! I know when I find a grocery store offering good deals on everything I need, I run to competitors to see if I can pay more to sign up for subscription memberships that will bill me whether or not I shop with them.
McGlade then describes Apple as the Orwellian ”Big Brother of the digital music scene.“ In case you didn’t get the memo that’s being passed around by every flack in the business of shilling, Apple is the New Microsoft, and so consumers should revile the company and flee to the safe harbor of Microsoft, which is now, logically, less of a Microsoft than Apple.
Forbes’ Lisa DiCarlo paints ugly pictures of Apple at every opportunity, but really outdid herself with the 2005 headline ”Is Apple The New Microsoft?“ which castigated Apple for its lawsuits against bloggers. In the same year, Daniel Lyons advised in Forbes’ ”Attack of the Blogs“ that, ”you can’t stop bloggers from launching an allout attack on you or your business if that’s what they decide to do–but you can defend yourself.“ So which is it Forbes?
Since then, the idea that ”Apple is the New Microsoft“ has been aped by such objective thinkers as Paul Thurrott of Windows Supersite, and supreme shill Mike Elgan, the former editor of PCWorld. How they can claim that Apple is bad for being like the company they have made excuses for over the last two decades is difficult to explain. Fortunately, they’re still wrong.
Forbes’ Fraud in Photos.
We don’t expect much from Thurrott and Elgan. We might expect more from Forbes. However, in a move that erases any suggestion that Forbes is objective and honest in the information it publishes, McGlade and Forbes put together a slide show of stomach churning, false information that goes far past disingenuous and lands directly in a patch of flat out fraud.
The first slide depicts a ”DRM is Killing Music“ t-shirt featuring an iPod. McGlade says ”It’s through proprietary DRM software that Apple enforces iTunes/iPod exclusivity.“ Except that that is a lie. The iPod doesn’t use DRM at all unless users chose to buy tracks online, which only a minority of users do.
He then notes that things are changing, starting, he says, with Universal and WalMart. He also notes that ”Apple, to its credit, has embraced this shift, offering DRM-free downloads on its site. However, every other retailer chose to offer-DRM free in the open MP3 format except for Apple.“
This is all very convincing except for the fact that we all know that Apple shocked the industry by announcing the first DRM free deal with EMI. Other groups slinked along later, offering a few MP3s only when browsing Windows-only sites as WalMart does.
Apple sells its music in AAC format, which is as open as MP3, but more technically sophisticated and easier to license. McGlade is working hard to associate DRM with the iPod, but he’s withholding the truth to do so.
The second slide of misinformation depicts the clunky failure of the Zune, along with a McGlade caption that notes ”Serious competition [to the iPod] has emerged in the past year or so, and its impact is beginning to be felt.“
No it hasn’t. The Zune is a joke and a major failure. Microsoft is losing billions in its consumer electronics efforts in order to establish a monopoly position in music with Windows Media, but is failing. McGlade is just sorry to be on the losing side, and is scrambling to tell us that up is down.
More Promotional Zune Fraud.
McGlade dives deeper into the toilet to fish out a third slide, which depicts a man in a wireless cafe using a Titanium PowerBook, photoshopped to obscure its Apple logo and further tampered to include what appears to be fake Intel and Windows stickers. To what further fraud will Forbes stoop?
Dear Forbes: your next assignment to is photoshop a VW Beetle to look like a generic car, and then use it in an article assailing Volkswagen for being too much like General Motors in the 1970s.
But what does a doctored Apple laptop at a hotspot have to do with the music industry? ”Samsung, Sandisk and Microsoft’s Zune were the first to innovate with features like wireless, access to music subscription services, unprecedented battery life and larger screens,“ the caption announced. ”Fast wireless puts the ‘music anywhere’ dream within reach.“
The Zune did include WiFi, but it was completely worthless for anything apart from draining the battery. Microsoft limited it solely for use as a way to send exploding commercials to other Zune users. It was Apple that delivered the first and only WiFi music store, delivering the supposed ‘dream’ of buying music anywhere. McGlade makes no mention of this because he makes no money on sales through iTunes.
Enter the iPhone.
”While Apple has scored another hit with the iPhone, the company will posses only a tiny segment, about 1%, of the global cellphone market in the product’s first year.“ McGlade wrote. He should have said, ”1.5% of the market in its first month,“ but his version sounds better for rivals. Why would he need to lie about the iPhone in a music article?
”By 2008, hundreds of millions of these phones will employ standard Microsoft software that will make them compatible with most download stores and subscription services.“
Because that ”standard Microsoft software“ would sell McGlade’s MusicNet content, he has to desperately overreach to suggest that the future will suddenly change and consumers will somehow get excited about Microsoft’s truly awful Windows Mobile products, despite their being a complete failure on the market even prior to the release of the iPhone.
Microsoft only has a tiny scrap of the smartphone market, about 5%, despite representing a broad selection of phone makers for half a decade. Apple outsold every one of those models in its debut month, selling at a premium price. That adds up to a wide spectrum of flacks, shills, and desperate CEOs ready to bad mouth Apple for their own loss in supporting Microsoft.
The next slide describes diverse devices that can play digital content, and depicts a Pioneer car CD player, which can play MP3 CDs and the radio. That means it can play CDs burned with iTunes, including purchased tracks, but not subscription music or WMA DRM.
It strangely makes no mention of AirPort Express or Apple TV and their ability to play iTunes content wirelessly to home stereos or TV, or Apple’s lead in iPod integration with car makers, or its deals with airlines to plug the iPod into in-flight audio and video playback systems.
That would undermine the intent of the photos. Besides, Forbes just printed an article by Scott Woolley which pretended that Apple TV was a huge failure compared to the massive losses behind Tivo (tens of millions per year) and Microsoft (billions).
As reader Timothy Bandy pointed out, ”overall, TiVo-owned subscriptions totaled 1.71 million, up 136,000 on an annual basis compared to the year ago-period.
“So if Apple sold 250,000 Apple TVs, it’s already doubled the amount of new customers Tivo made last year; or to put it another way, they already have 1/7th of Tivos’ customer base without hardly trying. And as you pointed out, I doubt they’ve lost several million bucks in the process.”
Double Locked Down Subscription Services.
Touting the double locked down rental music business McGlade represents, the next slide notes, “subscription services, which allow unlimited access to millions of music tracks for an average set monthly fee of $10 to $15, have been around for some time.” Yes, and have failed miserably!
“But with the advent of wireless-enabled players, phones and home devices, they are just now poised to deliver on an awesome promise: access to virtually all recorded music, anywhere, any time.” How? Ubiquitous networking “may soon render the idea of exclusive music ownership obsolete.”
In other words, no CDs for you. You will rent what MusicNet sells you, and you’ll like it at whatever price they set. You can rent access from any Microsoft/MusicNet store you chose, and play it on any Microsoft PlaysForSure or Zune player you pick, just not both, because they’re aren’t compatible with each other. Both are, however, double locked down.
Music You Want.
Speaking of which, McGlade reaches out embrace Latinos and Christian music buyers by advertising two specialty web stores that sell music from… well, you-know-who: MusicNet.
For this shameless and desperate advertisement / hit piece masquerading as news, Forbes gets a Zoon, as does MusicNet and its shameless CEO, Alan McGlade. Good luck trying to sell it, they’re worthless! I crank them out like paper money.
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