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Do Record Companies Have Steve Jobs Cornered?

itunesad.jpgNYT reporter Jeff Leeds’s story about Universal’s dispute with Apple has music-industry watchers in a tizzy this week, with some grunts joking off-the-record to us that “Mom and Dad are fighting again.”

FBLA asked Leeds if the Universal’s decision not to renew its annual contract to sell music through iTunes was little more than posturing. The short answer, according to Leeds is “No.”

But, he tells us: “It’s clearly an escalation of the tension that’s been building for some time. I suspect the record companies are going to be emboldened to look for ways to regain some leverage in their relationship with Apple.”


While Steve Jobs has the market on hardware, it might not be long before the Wii of the MP3 world comes along and knocks the wind out of the iPod. But with nothing that cool on the horizon, Apple is likely to be safe from a major coup.

“As long as the iPod remains as overwhelmingly popular as it is, the economics of digital music are always going to favor them,” Leeds said. “But what happened this week, could be an important moment.”

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