House of Pain

StockJockey's avatar
by StockJockey
Thursday, February 15, 2007 - 10:16 am

sndk2.jpg
It is rather strange to see the market ramping without Sandisk (SNDK-NASDAQ) participating...this stock was a go-to beta trade for years.

The story has long had more moving parts that just about any we have followed...making it tricky to trade.

Steve Jobs digital rights manifesto got a lot of play in the press. Eli Harari’s did not.

We picked up on it yesterday via Red Herring...it might be worth a perusal before Eli makes a CNBC appearance tomorrow to plead his case.

By Michael Cohn
SanDisk Chairman and CEO Eli Harari has an answer for Apple CEO Steve Jobs, penning an open letter about digital rights management protection on music files that he posted on his company’s web site in response to the open letter Mr. Jobs posted earlier this week on Apple’s site
. Red Herring

Eli’s open letter

An Open Letter from Eli Harari,
Founder, Chairman and Chief Executive Officer of SanDisk Corporation

February 7, 2007

As a loud debate continues over how digital music is sold and used by consumers, SanDisk believes there is another way to address this issue—an approach less confrontational than that voiced by others in the industry.

The answer is to protect the interests of everyone involved, not to chastise rights holders for trying to safeguard the entertainment they create and support.

As a leader in the digital music industry, SanDisk has always supported freedom of choice for consumers. At the same time, we believe that entertainment companies and artists must be compensated.

Consumers deserve fair use of the digital entertainment they purchase, with the freedom to enjoy content on any device they own. SanDisk’s approach is to let consumers decide how and where they acquire and play back their music.

Proprietary systems, in short, aren’t acceptable to consumers. In recent months, there has been a rising chorus of complaints in Europe about the anti-competitive nature of closed formats that tie music purchased from one company to that company’s devices, and tie that company’s devices to its music service.

SanDisk is already offering an alternative with its Sansa line of MP3 players, which connect to many major online music stores, including Rhapsody, Napster, URGE, Yahoo! Music, emusic and Best Buy Digital Music Store. Users purchasing songs from those services can also play them on many non-SanDisk devices. SanDisk and our partners have full support from the four major music companies, and we believe our offering is no less secure than closed systems.

What’s more, the decision on using digital rights management (DRM) should rest with the music industry, not with device makers.

Time and again, we have seen that open choice prevails. The “walled garden” approach may offer a smoother user experience in the short run, but ultimately restricts user choice. Protecting music doesn’t require confining consumers to a single company’s service or devices. It’s time to tear down the walls.

SanDisk is looking at the big picture, by creating solutions rather than conflict. Building an infrastructure to give consumers fair access to digital content while protecting content creators is vital for the long-term health of the music industry, as well as to our business and to our competitors. SanDisk stands committed to making this happen. Sandisk website

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The content contained in this blog represents the opinions of underthecounter. This commentary in no way constitutes a solicitation of business or investment advice. It is intended solely for the entertainment of the reader, and the author. Underthecounter has not positions in any securities mentioned above

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