Following the approval of a bill that could require the interoperability of Digital Rights Management (DRM) formats in France, Apple issued an official statement today, stating that the law would result in a "state-sponsored culture of piracy" if it were voted in by the French Senate in May. While Apple projects that iPod sales would likely increase as users "freely load[ed] their iPods with 'interoperable' music that cannot be adequately protected," legal music sales would supposedly plummet "just when legitimate alternatives to piracy are winning over customers."
France's proposed law would allow anyone to request information about DRM systems in order to make encrypted files interoperable with other devices. This would enable users to legally play music purchased from the iTunes Music Store on devices other than the iPod, such as Creative's Zen MP3 players. While Apple seems to fear that the move would also push users to illegally exchange music files, it's difficult to say whether this would increase piracy at all. After all, users have been able to exchange MP3s ripped from legally-owned music CDs for years.
Yesterday, Gene Munster, an analyst for Piper, claimed that Apple would likely pull out of the French market altogether rather than risk "what could be a slippery slope of other countries passing similar legislation." According to Munster, only 20% of iPod and iTunes sales are made outside the United States, and only 2% of those happen in France. Apple's potential pullout would therefore "not materially impact business."
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