Antitrust

Feds Investigating Apple Digital Music

Is the company strong-arming record labels?

Apple’s dominance in the digital music market has angered competitors, and the company is now raising the interest of the Justice Department. Apple employees have been in talks with major record labels and Internet music companies, sources say. The investigation concerns Apple’s tactics for selling music online, and how the company has used its huge market share to bully music labels into withholding access to Amazon.com. Billboard magazine reported in March that Apple punished music companies that cooperated with Amazon.com’s request for exclusive selling rights on certain songs “by withdrawing marketing support for those songs on iTunes.” Amazon is an Apple competitor, but Amazon’s market share is a paltry 8 percent, compared with Apple’s 69 percent. Representatives from both companies declined to comment.