Endpoint Technologies analyst Roger Kay said Palm's decision to update the Pre smartphone's OS to reconnect to Apple's iTunes music player could prompt a legal escalation and hurt the end user.
What appears destined to become a digital cat-and-mouse game between Palm’s touch-screen Pre smartphone and Apple’s iTunes digital media player took another turn this week when Palm updated the operating system for the Pre. Palm webOS 1.1, which the company hopes will make the Palm Pre smartphone more appealing to businesses, is also an excuse for the company to reconnect Pre users to Version 8.2.1 of Apple’s iTunes application.
On July 15, Apple updated iTunes, and the newest version prevented the Palm Pre from syncing with Apple's proprietary music app. At the time, Palm spokeswoman Leslie Letts called Apple’s move a “direct blow to their users, who will be deprived of a seamless synchronization experience.” Letts also recommended in lieu of the seamless iTunes sync, Pre owners could use an older version of iTunes, use a USB cable to transfer music from a computer to the Pre and look to other third-party music applications.
In May, early tests of the Palm Pre made it known that Palm's upcoming Pre WebOS will include an application called Palm Media Sync, which will synchronize with iTunes and allow users to transfer DRM-free music, photos and video onto the Pre. Jon Rubinstein, executive chairman of Palm and a former Apple employee, said at the time the application was designed “to be an easy and elegant way” for users to take content and put it on the Pre.
Months before, during a Jan. 21 earnings call, Apple COO Tim Cook, declining to name Palm specifically, said, “We will not stand for having our IP ripped off, and we’ll use whatever weapons that we have at our disposal.” Roger Kay, president of Endpoint Technologies, said the speed with which Palm was able to reconnect itself to Apple is noteworthy, though he points out Palm employs a number of former Apple people.
“One of the differences with Palm is [because] it's populated with so many former Apple people, they may know the architecture better,” he said. “There may be all sorts of relationships there. They may have emotions about being cut out of the action at Apple. It’s not really sound business to approach it that way, but this business allows emotions to get swayed.”
Kay said that fight for control is an ongoing battle between Apple and the rest of its ecosystem, which is ultimately not to the benefit of end users. “The competitor has to do another twist to meet [Apple’s block], and Apple twists after that—after awhile the software isn’t operating very well, for business reasons, essentially,” he said. “It may simply be about the iPod world is so attractive, that to be a viable handset Pre has to have access to that world. And I think that’s correct.”
With iTunes, Apple has created a nexus of power that’s extremely difficult to dislodge, Kay points out. “Basically Apple’s in the business of selling high-margin hardware—it’s a great business,” he said. “What I would say is they escalate slowly—maybe they send a cease and desist letter.”
Kay said if Apple moves too fast and opens with a lawsuit and doesn’t win, it would create a precedent for opening its platforms. “That would be the worst thing that could happen,” he said. “I would guess that like any good lawyer, their attorney will tell them to escalate a bit at a time and gradually raise the stakes. They’re not going to give up easily, but would they go another round of cat-and-mouse? Probably not.”
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