Apple facing antitrust probe over online music dealings

Sounds like the payola scandal, updated for the digital era …

The US Department of Justice has reportedly launched an antitrust inquiry into Apple and its music sales tactics, according to unnamed insiders speaking to the New York Times. Investigators have reportedly begun questioning members of the music industry about Apple in an attempt to determine whether the company is abusing its dominant market position. The probe is said to be in its early stages.

According to the Times, the DoJ has specifically inquired about reports from March that Apple put pressure on music labels not to participate in Amazon MP3’s “Daily Deal” promotion. At that time, anonymous music industry executives told Billboard that Apple was uncomfortable with the labels promoting music on both iTunes and Amazon. iTunes reps allegedly began threatening to “[withdraw] marketing support for certain releases featured as Daily Deals” if labels continued participating in Amazon’s promotion.

Apple has been the top music retailer in the US since early 2008, which is why the DoJ has taken a special interest in the company’s tactics. Apple has never been one to rest on its laurels, either—its alleged behavior toward Amazon, a relatively small competitor by comparison, is an indication that it views the online retail giant as a growing threat. The investigation may turn up nothing, but if the DoJ finds that Apple’s behavior was indeed inappropriate, Apple could find itself in a world of hurt.

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