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Wednesday, January 09, 2008, 06:00 am PT (09:00 am ET)

Apple to standardize iTunes music prices across Europe

Apple said Wednesday that within six months it will lower the prices it charges for music on its UK iTunes Store to match the already standardized pricing on its other European iTunes Stores.

The move will see British iTunes customers charged the same rates for digital music downloads as those customers located in Austria, Belgium, Denmark, Germany, Finland, France, Greece, Ireland, Italy, Luxembourg, Netherlands, Norway, Portugal, Sweden, Switzerland and Spain.

As a result of its concessions, Apple said it will be forced to pay some record labels more to distribute their music in the UK than it pays them to distribute the same music elsewhere in Europe.

“This is an important step towards a pan-European marketplace for music,” said Apple chief executive Steve Jobs. “We hope every major record label will take a pan-European view of pricing.”

Back in April, the European Commission formally charged Apple and the four major record labels with anti-competitive practices in the deals that form the backbone of European iTunes stores.

Specifically, the commission argued that shoppers are often forced to buy only from their home store, preventing them from earning the best rate. This is particularly the case for British shoppers, the regulators explained, as the 79p song downloads were the most expensive across the European region.

The commission welcomed Apple's announcement Wednesday to equalise prices, saying it now considers the case closed and no further action will be taken.

"The Commission is very much in favour of solutions which allow consumers to benefit from a truly Single Market for music downloads," said European Competition Commissioner Neelie Kroes.

In a statement, the commission added that its has been able to clarify that there is no agreement between Apple and the major record companies regarding how the iTunes store is organised in Europe. Rather, the structure of the iTunes store is chosen by Apple to take into account the country-specific aspects of copyright laws.

"The Commission is very much in favour of solutions which would allow consumers to buy off the iTunes' online store without restrictions," the the statement said, "but it is aware that some record companies, publishers and collecting societies still apply licensing practices which can make it difficult for iTunes to operate stores accessible for a European consumer anywhere in the EU."

In its own statement, Apple said it would reconsider its relationship in the UK with any record label that does not lower its wholesale prices in the UK to the pan-European level within six months.