Glaser's latest surprise came a few weeks ago when RealNetworks announced it had figured out a way to re-create Apple Computer's proprietary technology for digital rights management--without Apple's permission. This allowed RealNetworks to begin selling songs in its digital music store that could play on Apple's hugely popular iPod, which no other non-iTunes store can do.
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Musical chairs
Powerful strides by Apple and
Microsoft point to RealNetworks'
compelling need for alliances.
The only plausible future for the digital music business, he says, is one in which customers can buy a song and have it work on any device--the same way CDs work today. The current balkanization of the industry, where songs bought at one store only work on specific brands of devices, doesn't make any sense, he contends.
So far, the company's stand for "freedom of choice"--the slogan of a new marketing campaign beginning Tuesday--hasn't translated into bigger sales. But a half-price sale in RealNetworks' store, aimed at highlighting the new Harmony technology, could change that.
News.com spoke with Glaser late Monday about the company's vision of a Rosetta stone for digital music and his relationship with his opposite number at Apple, Steve Jobs.
Q: Has the Harmony project met your expectations?
A: No, it has blown them away. We took the decision at the beginning of the year to implement Harmony. It really went back to some things we were working on before, where we've had good experience with creating technology with interoperability in the past.
That was with the Microsoft technology and the streaming media
servers?
Exactly. We had created the universal server that streams all the
major formats including the Windows Media formats. We'd seen it have a positive effect on the marketplace and we knew from a technology development standpoint how to do that kind of compatibility work. There is a tradition for it with Compaq, and actually even Microsoft has done some of it.
Every time you go into a situation you should have a good plan A and a
good plan B. That's been true for us through this whole process.
Then when it came time to bring it out, we thought, "Well, consumers will like it." But it's not particularly easy to demonstrate, because all it is, is that it works. And you know, people can already play music on their iPods and they can already play music on their Rios and can already play music on their Palms, but they can't play music that they purchased once on all three. Once we explained to people why this was a problem, receptivity was good.
Then a couple of days afterward, when Apple reacted in what I consider to be kind of a hysterical fashion, that created even more attention and visibility and awareness.
I've become friends with this guy Al Franken. He wrote a book and called it "A Fair and Balanced Look at the Right," and I kind of feel like Apple Computer is playing the same role on this that Bill O'Reilly played in "Fair and Balanced."
You had attempted to ask Jobs if he was interested in providing a license to FairPlay and the iPod back in April. But you had the Harmony project already under way at that point?
Absolutely. We had reached the conclusion that technically we had all the bases covered, and that we were going to be able to implement something that was very good. We didn't have all the finish on it, and all the user interface hooked up, and hadn't done all the final tuning and everything, but at the time I contacted Steve, we were well on the way--which is when he decided to do a Bill O'Reilly on us.
At that point, we kind of kept our powder dry. We were asked, "Can you explain, Mr. Glaser, why you sent that message to Mr. Jobs?" and we explained that we think compatibility and interoperability is good. And (we were asked), "Now that he's told you that he won't do that, what will you do?" And I said, "Well, we write software here, and we're just going to keep improving our software."
Every time you go into a situation you should have a good plan A and a good plan B. That's been true for us through this whole process.
In that exchange, Jobs leaked your request to the press. That's not standard operating procedure in a lot of business. Do you feel that was fair play?
No, FairPlay is his DRM.
No, look, Steve is a one-of-a-kind guy. You know that about him when you do business with him or when you work with him. I don't take any of that personally. My view is that we're doing something that's important for consumers here. The personalities make for interesting press, but the reality is that we were going to do what we thought was the right thing for consumers, in a way that we thought was completely in the tradition of well-established things like Compaq's compatibility for computers.
We think we're doing the right thing for consumers
and the right thing for industry, and it might well be the right thing
for Apple.
This a is case where we think we're doing the right thing for consumers and the right thing for industry, and it might well be the right thing for Apple. But we think it's going to happen in the long haul regardless.
Your "freedom of choice" campaign gets at what the record labels have
been asking for, and what consumers have been asking for in terms of
digital music interoperability. But in terms of Real's interests, if
everyone else also winds up being compatible, is that a good thing?
You have to assume long-term that everything is going to be compatible
with everything else. Is it good for us if that happens? Absolutely,
that means there's a bigger market. Our view is that the switchover of
the industry from the $30 billion physical music sales industry to
hopefully over time an equally large digital business is a tremendous
opportunity.
We think we benefit significantly when there is freedom of choice. That doesn't mean we end up with a monopoly in the business because we don't think that's the nature of the business. Yahoo doesn't have a monopoly in portals, but they have a great business in that world. Amazon doesn't have monopoly on the place where you buy physical goods on the Internet, but they have a great business. So in our view you can have a very fine business in a rapidly growing marketplace even if you're not a monopoly.
Do you still ultimately see yourselves focusing more heavily on
subscriptions?
News.Commentary
Commentary: Real
lobs a new grenade
Discount-priced songs
and Harmony software
will shake up the market.
What now have with Harmony are two things that are relevant. We have something that is differentiated and better. While we will license it to other people, we will license it on terms where if people use it and they pay us a little money for it and we multiply that by the volume of all the songs, that's great.
If nobody uses it and it turns out we're the only ones with Harmony technology for a year or two and ours is the best and the most reliable and whatever because we've been at it the longest, then we have that benefit too.
So we will put relatively speaking more emphasis on (individual) tracks than on subscription than we had because we have a compelling differentiation in both those areas. But I think at the end of the day we will continue to focus very substantial amount on subscriptions. We have had great success with Rhapsody. Not only with the number of subscribers, but with how active they are and with the kind of feedback they give us. Which is why I think it's not either/or, it's both/and.
But we'll also follow consumers. We'll learn.
You are in licensing talks now for Harmony?
I would say preliminary talks. We just introduced Harmony three weeks
ago, and we're just releasing the RealPlayer with Harmony as a consumer
product Tuesday, so any of the conversations we're in are in very
preliminary phases.
Do you see yourself doing the same kind of thing with Sony? Or are you talking about licensing their DRM?
We support (the Sony music format) ATRAC. We have had interoperability for
in-the-clear music with OpenMG-based devices, which is Sony's DRM, in
the past, and we may well do that in the future.
Today, Sony's hardware products for this market are not particularly significant in the marketplace. They still have some significant limitations, like they don't play MP3s natively. So the poor consumer has to transcode all their MP3s for these devices, which is kind of a backward way of looking at things.
We think Sony's a terrific company and have a good relationship with them on a number of fronts, so I wouldn't rule anything out. But by covering Helix, and Windows Media and FairPlay or iTunes devices, we've covered 90 percent of the secure devices that are out there.
See more CNET content tagged:
Rob Glaser,
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Apple Computer,
song
----------
Real has screwed themselves through REAL-ly crappy software
abusive customer policies, and "nagware" over the years. They
dug their own grave.
-----
I think what really gets Rob is that he once employed the
designer of the iPod. Rob just wasn't enlightened enough to take
advantage. Jobs was.
public thinks. So Real created http://freedomofmusicchoice.org
today to let the public speak about about Real's "innovative"
product.
So Real put up a petition and allowed people to comment on the
articles they posted on their site. Guess what? 95% of those 300
who signed the petition said they believed Real had NO RIGHT to
force Apple's hand, and all of the comments said the same
thing.
So what did Real do? They pulled the petition and the comments!
Very funny indeed.
all the links to it. Want to have some fun/laughs, go read the
signatures/comments...
http://www.petitiononline.com/mod_perl/signed.cgi?
r4apple&351
And by acting like a scared bully, Apple brought much derision on themselves from folks like me.
Now, Real is cutting, temporarily, prices on their music down to about $.50 a track. (It's still not as cheap as Emusic, which will never again be as cheap as it was, but that's a whole 'nother sidebar.)
And, interestingly, that brings into focus what's [i]really[/i] wrong with Real's music sale model -- by pretty much lockng their media to their software player they're already engaging in the same consumer-unfriendly tactics they're accusing Apple of.
Fifty cents a song isn't too bad a price (especially considering the hefty licensing fees to the labels that Real is presumably paying for each file) but I'll be danged if I'm going to buy media I HAVE to play in a given software player -- particularly when that player is the invasive, snoopy RealPlayer.
Since the subscription service I use (MusicMatch On Demand) uses the MM player (and boy is the new version a big pig but the service itself is pretty cool), I'm also able to play my own mp3s, wmas, and a handful of other formats -- mixed in with music streaming from my subscription with On Demand, which is pretty crucial.
This is ideal, since it lets me mix music from the subscription service and my own collection (which is covered to a large but not complete degree by OD's large but by no means universal library) intermingling the playback in real time.
If I were to buy a bunch of songs from Real I'd have to stop MusicMatch and load the RealPlayer to play them, then go back to MusicMatch to hear the rest of my music. (Also my normal media player is Winamp; my choice of players in descending order of desirability is WA, MM, WMP, and then Realplayer and Quicktime in more or less a tie for last. Although QT and Realplayer do provide marginally better video at slow broadband rates.)
These folks have to face up to a timeless reality -- if you want widespread adoption you have to adhere to interoperability standards. It was ultimately the case with the phonograph; the adoption of the CD was amazingly free of competing standards and had one of the most rapid product paradigm shifts in history.
The world of business computing has been revolutionized by the notion of interoperability. And it's clear that having core standards, even in a rapidly changing and evolving technological milieu, helped make the internet the extraordinairy technological and cultural phenomenon it is.
You'd think these would-be digital media mavens would see the handwriting on the wall and give consumers what they want instead of what the companies think the companies themselves "need."
But lo and behold! I'm not able to access the Real Music store!
Some freedom of choice! :P
If real has such a compelling product, why can't they just make their own iPod? Answer: They don't. They can't. This is just a "stupid quarterly stock price stunt".
Beware of what you ask for.
Steve
I talk about how many conservatives hate Microsoft and love linux, and how these socialists are getting behind various media companies.
Well people, this article just brings it all home. Rob Glaser is a freaking SOCIALIST. He hates america if he likes Al Franken. I think now is the time to actively start destabilizing this company and bring these REAL terrorists to a face-to-face confrontation with the citizens they are harming.
To think that a socialist controls a multi-million dollar media company makes me ill. It ends here though, Rob you fool, you have let your secret out, and now it will come back to haunt you. This I vow.
This is from a company that took down the comments on their "freedom of choice" page - guess free speech contradicts with your Al Qaeda version of 'freedom of choice.'
Where is our freedom of choice for Real's RM/RAM files? Where's my converter for that file format to Mp3?
Where is my freedom of being able to use the REal store if I'm using anything but WINDOWS?
ALL music stores were closed to macs so apple had to invent one - PC users abandoned their stores in droves to shop at Apple's so Real's only response is to throw a brick through a competitor's front window?
Like Al Qaeda, they are more interested in destroying everything/anything just to prove they can - and in the case of Real - better to destroy consumer's ease of use now for their version of how to better make money?
they would offer their content beyond the "Windows
Only" crowd.
I want to see Real practice what they preach. Give us
"Freedom Of Choice" and offer your goods to not only
just Windows, but Mac, Linux, Amiga and etc...
It's time to give consumers "Freedom Of Choice" and
finally break the "Windows Only" experience!
Real's "Freedom Of Choice" falls short in the true
meaning of the phrase. Consumer freedom spans beyond
just "Windows Only" and I think it's time that these
companies start realizing that.
asked him why he didn't think the whole reverse technology
thing wasn't simply stealing from Apple. AND, you let him get
away with the whole "we want what's best for consumers" scam.
Come on - it's what's best for RealNetworks. Some journalism!
I won't use RealNetworks Music Site, it's basically about theft -
there's plenty of music available other places.
download is a new and innovative business. Today it is much
harder to succeed with runner up technology like e.g. Windows
was back in the 80s.
And, to be honest, Real's marketing strategy is pretty lame. What
they tried at http://www.freedomofmusicchoice.org/ turned out
to be a massive backfire at Real - basically by non Apple
evangelists.
Glaser has to face it: Real's technology can't compete with iTMS,
and "hacking" Apple's technology can't be a solution - again, a
Bill Gates could have gotten away with this 10 years ago.
And finally, who in the business does not give choices? Try
converting Real-content into anything else ... bummer. Real is a
dead end for media. Who would ever be so smart to attack Apple
for not giving choices, and at the same time not offering a client
for Macs for Real's super innovative 0.49$ deal, which should
free the iPod?
I should stop here, othewise I would start to criticise the
interview with Glaser itself, where he can get away with things
like "we do the best for our customers" btw a probably
constantly shrinking minority ...
If Apple doesn't want to share theie technology then so be it. Don't go hacking your way in...
So let me get this right. If a bank won't allow him to open an account, will he go robbing that bank? Is that the lesson he is trying to preach?
I am surprised that Wall Street even is responding to lowly idea of Rob's.
I feel like insulting him but what's the point. A man without character won't suddenly develop character.
Read it & see if you agree!
Mike
and then not much competition at all. If Glaser thinks it's the
best available, then we know just how good Glaser is. Sorry,
Real, I tried your software and I trashed it shortly thereafter. I'm
not about to be suckered into trying 'harmony'.
Apple is a pioneering company, and I understand their desire to get paid for their innovations - but does history need to repeat itself? Decouple, decouple, decouple. Let the merits of your hardware and your software stand on their own. Consumer markets want choice.
I'm not saying Real is right, but they may be doing Apple a favor in the long run. Just imagine if another PC company, like IBM, had come in and made another computer that could run Mac OS without Apple's permission back in the day? Apple would have been enraged! But . . .
Who would have the lion's share of the consumer computer OS market today if that had happened . . . would it still be Microsoft? Or maybe Apple instead?
It's a cult or something.
- Wow, what a great public bj that was
-
by jfbiii
August 18, 2004 12:21 PM PDT
- Glaser is full of it. Instead of growing the market, he's trying to
-
Reply to this comment
-
Showing 1 of 2 pages (30 Comments)steal part of the existing market. If he would actually try to grow
the market, Steve might talk to him, maybe even work with him.
But Rob's a bs artist who doesn't care about consumers so much
as he cares about the easiest way to grab a buck. And growing
the market to get more customers is a lot harder than trying to
swipe someone else's.
If Real offered a great product, they wouldn't be so desparate.