I've been writing a lot recently about the Real / Apple imbroglio (What Real's Hacking of FairPlay Doesn't Do, Can Copyright Holders Sue Real for Converting Files from Helix DRM to FairPlay DRM?, and Can Real Sue Apple Under the DMCA?). Short story, Real has developed a technology, Harmony, that will convert files encrypted with Real's Helix DRM into files that mimic Apple's FairPlay DRM, but not the reverse. Interesting legal questions are raised.

Today, Apple has issued a press release with a legal threat (Apple Statement):

We are stunned that RealNetworks has adopted the tactics and ethics of a hacker to break into the iPod(R), and we are investigating the implications of their actions under the DMCA and other laws. We strongly caution Real and their customers that when we update our iPod software from time to time it is highly likely that Real's Harmony technology will cease to work with current and future iPods.

Derek Slater has a good selection of links and analysis (Apple Threatens Real). CNN has an article that quotes yours truly (Apple: RealNetworks hacked iPod). Slashdot comments (Apple Not Too Harmonious with Real).

Will Apple sue? I think they may, in order to set a precedent and warn Microsoft off. A lawsuit would also create further FUD about Real's ability to survive in this cutthroat market.

It isn't clear what issues will actually come to the legal forefront. If Real's software was a clear violation of the DMCA, Apple would have said so (and Real probably wouldn't have tried this). There are also various state law possibilities, such as unfair competition and whatnot. This will certainly be a case to watch.

UPDATE 1150 PT

Over on engadget, Siva Vaidhyanathan, copyfighter, has a guest editorial on DRM lock-in that starts with coffee machines and ends up with Apple/Real (The Trouble with Tethering). See also, Derek Slater (The Practical Impact of Lock-in). Concludes Vaidhyanathan,

If Apple is smart (as it occasionally is, but rarely in this domain) it will welcome Rhapsody users. Tethering may be the hot corporate move of the moment. It may be what all the consultants are pushing (corporate consultants are basically anti-competitive). But it’s ultimately bad business and - when backed up by law - bad public policy.

Real has also issued a countervailing press release:

RealNetworks Statement about Harmony Technology and Creating Consumer Choice

Real is delighted by initial consumer and music industry support for Harmony. Compatibility, choice and quality are critically important to consumers and Harmony provides all of these to users of the iPod and over 70 other music devices including those from Creative, Rio, iRiver, and others. RealPlayer Music Store provides the highest sound quality of any download music service. That's why so many consumers have welcomed news of Harmony. Consumers, and not Apple, should be the ones choosing what music goes on their iPod.

Harmony follows in a well established tradition of fully legal, independently developed paths to achieve compatibility. There is ample and clear precedent for this activity, for instance the first IBM compatible PCs from Compaq. Harmony creates a way to lock content from Real's music store in a way that is compatible with the iPod, Windows Media DRM devices, and Helix DRM devices. Harmony technology does not remove or disable any digital rights management system. Apple has suggested that new laws such as the DMCA are relevant to this dispute. In fact, the DMCA is not designed to prevent the creation of new methods of locking content and explicitly allows the creation of interoperable software.

We remain fully committed to Harmony and to giving millions of consumers who own portable music devices, including the Apple iPod, choice and compatibility.

Ed Felten weighs in (Apple Threatens Real) via Copyfight

Okay, so Apple was mighty ticked off that Real had made Apple's product better, without even getting permission or anything. So Apple cried foul. Apple was shocked 'n' saddened that Real was trying to improve Apple's product, like those hacker guys are always doing. So Apple drew a line in the sand, and swore to make its own product worse again.

I don't know about you, but I find this all very confusing. I guess I just don't have a head for business.