April 16, 2004, 9:28 AM — RealNetworks Inc. Chairman and Chief Executive Officer (CEO) Rob Glaser has urged Apple Computer Inc.'s CEO Steve Jobs to partner its digital music businesses against rival Microsoft Corp., according to a report published Thursday in The New York Times online edition.
In an e-mail sent April 9, Glaser offered to create a "tactical alliance" with Jobs and Apple, the report said, citing the message that was obtained by The New York Times "from a person close to Apple."
Should Apple, in Cupertino, California, and RealNetworks, in Seattle, be unable to reach an accord, RealNetworks may turn to Microsoft to pursue "very interesting opportunities," the report quoted Glaser as writing.
A RealNetworks spokesman at the company's Seattle headquarters later on Thursday confirmed that Glaser sent an e-mail message to his counterpart at Apple, but the spokesman said it was intended as a private message. Apple representatives did not return calls requesting comment. A spokesman for Microsoft in Europe said he was unaware of the report.
An alliance between RealNetworks and Microsoft would be an about-face in the relationship between the two companies. RealNetworks has long lobbied against Microsoft's market dominance and currently has a private lawsuit lodged against Microsoft in the U.S. accusing the Redmond, Washington, company of using its monopoly powers to control the digital media market with its Windows Media Player to the detriment of Real's competing player.
But given that Apple is currently the digital music market leader with its iTunes online music store, Glaser would like see RealNetworks license Apple's Fairplay digital rights management system in exchange for making Apple's popular iPod music player the primary device for the RealNetworks store and for the RealPlayer software, according to the report.
Though RealNetworks' encrypted music services, Rhapsody and the Real music store, both support the digital music technology standard favored by Apple -- AAC -- the RealNetworks services cannot currently be played over an iPod. That limitation may force RealNetworks to switch to Microsoft's competing WMA format, the report quoted Glaser as writing.
However, he was quoted as writing, "instinctively I don't want to do it because I think it leads to all kinds of complexities in terms of giving Microsoft too much long-term market momentum."
Glaser has repeatedly criticized Apple for locking down the iPod player so it only plays Apple's own secured music technology, Fairplay, and not formats used by competing online music stores.
"We have consistently stated that Apple should open the iPod and Rob (Glaser) recently communicated that directly to Steve (Jobs)," RealNetworks spokesman Greg Chiemingo said.