Apple Inc. (NASDAQ:AAPL) Has Been Given A Clean Slate in The Class-Action Suit

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By Thomas Copeland on December 18, 2014 Intl News

Apple Inc. (NASDAQ:AAPL) recently faced a class action suit for using anti-competitive strategies for its iTunes. However, the company has not been found guilty of this offence, and it has been given a clean slate. According to the claims of class-action suit, the company’s use of DRM gave rise to non-competitive strategies, especially its security features for iTunes and iPhones.

It is important to mention here that the suit was initiated back in 2005 when Apple Inc. (NASDAQ:AAPL) provided DRM locked songs via its iTunes Music Store. The company entered into such contracts with the songs publishers that allowed it to control the use of music; the music downloaded through iTunes Store could only be listened to in a specific ecosystem.

What is interesting to note here is the fact that Apple Inc. (NASDAQ:AAPL) was not the only company who designed such security policies; Microsoft’s Zune Store and PlayForSure had the similar policies in play. The contracts with the music publishers were so strong in nature that no company could have offered transportability for the exchange of files. For instance, it would have been a breach of contract, had Apple Inc. (NASDAQ:AAPL) allowed its music files, which were downloaded from iTunes Store, to be transferred to any other medium except iPod.

This class action suit was argued before an 8 member jury board, and the board unanimously decided that the company’s security and DRM practices were nothing but a genuine improvement in the product system. As soon as the verdict came out, the company released a press statement whereby it thanked the jury for its services and applauded the decision delivered by them. Apple Inc. (NASDAQ:AAPL) further said that the company designed iTunes and iPods so that its customers can listen to music in the best possible way, and it has been continuously upgrading its products in order to make the customer’s experience nothing but the best.

DRM does not prevail any more, for the digital music has seen much improvement since 2005. Now, most of the stores, which offer music, provide it in a DRM free environment. However, they still use DRM in their subscription services so as to time out their services monthly.

The class action related to Apple Inc. (NASDAQ:AAPL) was filed in a time period when the environment for digital material and music was quite silted. The situation has been changed now. And this fact was recognized by the members of the jury. Now, customers can transfer their music from one store or media to another without any restrictions being placed upon them.

Coming to the stock prices of Apple Inc. (NASDAQ:AAPL), the company saw an increase of 2.5 percent in its stock prices as soon as the verdict came out. On the last trading day of December 17, 2014, it started its stocks at a price of $107.12 and closed at an increased price of $109.41. The company has a total market capitalization of $623.76 billion.