New York Times: Real Offers Apple An Alliance

April 14th, 2004 at 3:00 PM - News by Bryan Chaffin and Vern Seward

Hereis a bit of news that should make you sit up and take notice: The New York Times is reporting that Real Networks, the company that currently competes with Apple and Microsoft in the digital media format arena, has extended an offer to Apple to team up against the Redmond software giant, Microsoft.

According to the newspaper, Real CEO Rob Glaser extended the invitation directly to Apple CEO Steve Jobs in an e-mail. The newspaper says it obtained the e-mail from what it called "a person close to Apple." The article also says that Mr. Glaser was surprised that the e-mail was leaked.

The crux of the offer is that Mr. Glaser wants Apple to license its FairPlay DRM technology to Real, allowing Real customers to play songs they download from Realis online music service on Appleis iPods. The Times says that Real would then make the iPod its primary music player.

Along with the carrot dangled a stick, however, with Mr. Glaser intimating that if he can not work a deal with Apple, his company would likely switch camps from AAC, which it currently uses, to Microsoftis WMA format. Such a move would further isolate Apple in its battle for market share for AAC.

From the article:

Apple executives would not comment on the message. But it seems likely Mr. Jobs will rebuff the offer. Mr. Glaser said he had not received a response from Mr. Jobs, and in his e-mail message Mr. Glaser said he was going to be in Silicon Valley this week and suggested that he meet with Apple executives today.

[...]

"Real understands how incredibly powerful the Microsoft music initiative will be," said Richard Doherty, a computer industry consultant and president of Envisioneering. "I donit think that Jobs understands this. He doesnit realize how big the juggernaut is about to get."

In his e-mail message to Mr. Jobs, Mr. Glazer said that he was reaching out to Mr. Jobs before making a move to switch camps. Mr. Glaser said he was surprised that the proposal had been leaked.

"Why is Steve afraid of opening up the iPod?" he asked in a telephone interview. "Steve is showing a high level of fear that I donit understand."

This is a particularly interesting article, so stop by the New York Times to get the full scoop.