Apple Inc. has recently won over the antitrust charge of having illegally stopping the iPod iTunes users from playing music from services other than iTunes on their iPods. Apple has challenged the century old notion that “big” is deemed to be bad for consumers and that “competition” is always good.
Apple has in fact succeeded highly in serving elite consumers entertainment needs. Its win has challenged the imprecision of antitrust laws and the technological and economic lack of knowledge of the judiciary. If, on the contrary, Apple would have lost the class action lawsuit, more than 8 million iPod owners who bought iPod devices during September 2006 and March 2009, hundreds of retailers, would have been jointly eligible for up to $1 billion in damages.
The antitrust case filed against Apple alleged that the company harmed consumers and quashed digital music industry incumbents when it expelled competing music stores’ songs from playing on its iPod music player. The jury rightfully decided that the update to Apple’s iTunes music store that emanated in 2006 constituted as a genuine product improvement and thereby not violating antitrust laws.
The Sherman Antitrust Act states that, a genuine product improvement cannot be termed anticompetitive, even if it ills competitor’s products. “A company has no general legal duty to assist its competitors, including by making products interoperable, licensing to competitors or sharing information to competitors,” Judge Yvonne Gonzalez Rogers of the US District Court in Northern California stated in Apple’s iPod antitrust case hearing. Apple’s efforts on the newer updated versions of iPod were instead taken as its steps towards creating a more innovative ecosystem for its consumers.