Universal 'to revise iTunes deal'

Universal Music Group is reported not to be renewing its annual contract to sell its music through Apple's iTunes.

The New York Times quoted unnamed executives as saying that Universal had decided to have monthly deals instead.

That would allow Universal to remove songs by some or all of its artists quickly if there are disagreements on terms and pricing in the future.

But the San Francisco Chronicle carried a denial from Apple, which said that talks were still continuing.

"We are still negotiating with Universal," the newspaper quoted an Apple spokesman as saying.

"Their music is still on iTunes and their not re-signing is just not true," he added.

Flat charges

There have been disagreements between Apple and record labels in the past about the pricing and protection of the songs on iTunes.

Apple has stuck to a flat charge of 99 cents per song in the US since iTunes was launched four years ago.

But many of the labels are understood to want to be able to charge more for popular songs and less for songs that they are trying to promote.

There have also been objections to the copy-protection that iTunes uses, which means that iTunes downloads cannot be played on MP3 players other than Apple's iPod.

In February, Apple boss Steve Jobs called on labels to allow iTunes to remove the copy-protection. EMI has since begun to sell "premium" versions of its tracks through iTunes without copy protection.

But some labels have refused to have the protection removed and say that Apple should instead license its technology so that its copy-protected songs can be played on other devices.

Shares fall

Both Apple and Universal have much at stake if their relationship deteriorates.

If Universal pulls its catalogue from iTunes then the store would lose access to record labels that account for one out of every three new releases sold in the US, according to Nielsen SoundScan.

On the other hand, iTunes is by far the most popular download store, with a 70% market share, according to the NPD Group.

Reports of a dispute hit Apple shares on Monday - they closed down 78 cents at $121.26 on Nasdaq, although that was also linked to some disappointment about the first weekend's sales of its new iPhone.

iTunes Technology New by BBC News

EU price probe into Apple iTunes

The EU has launched an inquiry into what Apple's online music store iTunes charges users across Europe, accusing it of restricting customer choice.



Brussels believes agreements between Apple and record companies violate EU laws by preventing users in one country buying music from a site elsewhere.



The move follows a complaint by UK body Which? that British users have to pay more to download songs than others.



Apple said it wanted to offer a single European service but faced obstacles.



Different pricing



The Commission's move is unrelated to an agreement, announced on Monday, between iTunes and EMI to make the latter's music available online without piracy protection.



Brussels has written to Apple and a number of unnamed record companies to notify them of their objections to the way music is sold, the first step in formal proceedings.



Media reports speculated that it had contacted each of the "big four" record companies - EMI, Sony BMG, Warner Music and Universal Music.



The Commission said Apple established customers' country of residence through their credit card details and only allowed people to buy tracks from the website for that country.



"Consumers can only buy music from the iTunes online stores in their country of residence and are therefore restricted in their choice of where to buy music," said EU competition spokesman Jonathan Todd.



Research by Which? in 2005 found that UK users paid 79p (1.16 euros) to download a song, compared with 66p (99 euro cents) in France and Germany.



Apple said it had always wanted to offer a fully pan-European service, but was restricted by the demands of its music partners.



"We were advised by the music labels and publishers that there were certain legal limits to the rights they could grant us," it said in a statement.



'Restricting competition'



The companies targeted by Brussels have two months in which to respond to the charges.



Which? welcomed the investigation, saying the benefits of the European single market should be available to music lovers in all member states.



"This investigation proves that iTunes is overcharging its UK customers, who are paying substantially more for their music," said Alena Kozakova, its principal economist.



"The announcement means that companies can no longer hide behind intellectual property rights to restrict competition for consumers."



Apple iTunes News by BBC NEWS

Universal 'to revise iTunes deal'

Universal Music Group is reported not to be renewing its annual contract to sell its music through Apple's iTunes.



The New York Times quoted unnamed executives as saying that Universal had decided to have monthly deals instead.



That would allow Universal to remove songs by some or all of its artists quickly if there are disagreements on terms and pricing in the future.



But the San Francisco Chronicle carried a denial from Apple, which said that talks were still continuing.



"We are still negotiating with Universal," the newspaper quoted an Apple spokesman as saying.



"Their music is still on iTunes and their not re-signing is just not true," he added.



Flat charges



There have been disagreements between Apple and record labels in the past about the pricing and protection of the songs on iTunes.



Apple has stuck to a flat charge of 99 cents per song in the US since iTunes was launched four years ago.



But many of the labels are understood to want to be able to charge more for popular songs and less for songs that they are trying to promote.



There have also been objections to the copy-protection that iTunes uses, which means that iTunes downloads cannot be played on MP3 players other than Apple's iPod.



In February, Apple boss Steve Jobs called on labels to allow iTunes to remove the copy-protection. EMI has since begun to sell "premium" versions of its tracks through iTunes without copy protection.



But some labels have refused to have the protection removed and say that Apple should instead license its technology so that its copy-protected songs can be played on other devices.



Shares fall



Both Apple and Universal have much at stake if their relationship deteriorates.



If Universal pulls its catalogue from iTunes then the store would lose access to record labels that account for one out of every three new releases sold in the US, according to Nielsen SoundScan.



On the other hand, iTunes is by far the most popular download store, with a 70% market share, according to the NPD Group.



Reports of a dispute hit Apple shares on Monday - they closed down 78 cents at $121.26 on Nasdaq, although that was also linked to some disappointment about the first weekend's sales of its new iPhone.



iTunes Technology New by BBC News