Chapter 325 Dangerous Situation (Three-in-One)

On September 20, Yike officially appealed to a higher court against Virginia’s product sales ban.

Also on this day, Yike submitted a complaint against Apple for alleged unfair competition in the Supreme Court of New York City, New York.

At the same time, Cadwalader Law Firm took into account the key sales areas of Yike products and planned to launch protective lawsuits based on the Anti-Unfair Competition Law and the Uniform Trade Secrets Act within a week in California, Washington State, Massachusetts, and the District of Columbia.

Yike used to respond proactively and passively, but now it has turned to a tit-for-tat proactive approach.

You sue me, he sues me, he sues you, you sue him... The situation involving music copyright and industry development has finally reached the final stage of "I sue you, I sue him."

In the afternoon of that day, the Yike team took a bus to have a new round of business negotiations with ASCAP.

"Xiao Yu, do you think there is room for cooperation between us and Apple?" Fang Zhuo was thinking about a question on the way.

"They have issued the ban, and we started to sue them again in the morning. Isn't there little room for cooperation?" Yu Hong said.

"ASCAP also sued us, but we are still talking about it." Fang Zhuo said with a smile, "But how should we find this cooperation area? The only thing I can think of is digital copyright."

Among the easy-to-use music format conversion software in the American market, iMusic and iTunes are relatively well received. They follow the principle of simplicity and stand out among the complicated software.

In fact, both iMusic and iTunes are for the use of their own users, and the wider spread exceeds the expectations of the two companies.

In addition, there are consumers who use Apple's iPod to use Yike's iMusic because the latter has wider adaptability and the former is positioned as compatible with Windows. This is also one of the reasons why Apple accuses Yike of unfair competition. .

"Mr. Fang, how many users can paid digital music downloads bring?" Yu Hong was different from Fang Zhuo's firmness. She still had some hesitations at the software level, which was also the doubt of some employees.

"The market cannot continue to be so barbaric. If you walk on the right path, you will definitely gain something, and the harvest depends on our method in the process." Fang Zhuo glanced at his watch. It would be three o'clock in the afternoon. He could already see Here comes the AS sign.

Yike arrived at AS's office and everyone got out of the car.

This is Fang Zhuo's first time here, but others have been here many times.

However, by coincidence, Fang Zhuo saw people from Apple when he was passing by the corridor. They seemed to have just finished their meeting with AS.

Yu Hong frowned, not naive enough to think it was a coincidence.

Fang Zhuo also felt a sinking feeling in his heart. AS brought the two competitors together so nakedly just for a higher offer. He didn't think the other party was more optimistic about Yike than a listed company like Apple.

In other words, AS is most likely using Yike as a bargaining chip to raise prices against Apple.

At 3:10 in the afternoon, Fang Zhuo and his group of seven people sat in the conference room where Apple had just sat. Everyone's mood was obviously depressed.

"It's okay, we have to push back and talk again. AS is here to just practice, and there is another one." Fang Zhuo said in Chinese what he was considering under the current situation.

The guidance spirit of breaking the jar and breaking it was very effective, and the frustration of the other six people dissipated a lot.

After Fang Zhuo said this, he temporarily changed his negotiation strategy and said directly: "Mr. Taylor, our marketing director of Yike has been talking to you for a long time. I just saw that you have introduced new competitors. You Do you mind giving you a price that satisfies you based on the negotiation you just had with Apple?”

Taylor, the executive vice president of AS, was a little surprised by the calmness of the president of Yike. He thought for a moment and smiled: "You are much happier than your colleagues. Apple's licensing price is 30% higher than yours, and there is also a single." 60% share.”

The copyright library licensing price negotiated by Yike before with AS was around 10 million U.S. dollars a year, which is a fixed price. What we have to do online is charge for music downloads, and the negotiated share has always been around 50%.

Now Apple suddenly mentioned 13 million + 60% share, which is a very competitive offer.

Fang Zhuo weighed it in his mind silently and said: "I am happier than my colleagues because I am the president and I have authority that they do not have. Just like now, I can express my opinions on Apple's price from my status as the president of Yike. ”

Taylor asked with interest: "What do you think? Can you accept it?"

"Mr. Taylor, do you know why Apple is willing to quote a price higher than ours?" Fang Zhuo asked.

Taylor laughed and said directly: "Because they have more money than you."

Yu Hong and others looked a little ugly.

Fang Zhuo nodded and admitted without changing his face: "That's true, but the United States not only has AS, but also SE, BMI, and record companies. With Apple's current sluggish computer business, it has tens of millions of dollars a year. Royalty fees are also very stressful, and these require cash.”

Taylor shrugged: "So?"

"So, Apple would rather bear the pressure of raising the bid and urgently obtain the copyright because they are at a disadvantage in the current market." Fang Zhuo said calmly, "Apple has fewer users than Yike. Everyone knows that users who bought P1 and Ipod are the most accurate music users. Our value is to sell AS's music to them."

Taylor was unmoved.

Fang Zhuo tried to introduce competition: "Not only AS, but SE and BMI, who we are in contact with, are also very interested in Yike's user group."

Taylor showed a frivolous smile: "Really? Mr. Fang, as far as I know..."

He added emphasis and continued: "SE and BMI's response to you is not enthusiastic, even worse than our AS."

Fang Zhuo frowned slightly. It would be bad if the other party had communicated with SE and BMI.

He did not panic, but instead brought out the main purpose of today: "That's because AS has not heard our new conditions, while SE and BMI have heard them."

Taylor put away his contempt. This is possible. The Oriental man in front of him and his colleagues are indeed different.

"In addition to being willing to match Apple's offer to you." Fang Zhuo confirmed this first, and then continued in Taylor's surprised eyes, "We are also willing to make improvements on iMusic."

Taylor sat up straighter, quite interested: "How to improve?"

"All digital music copyrights authorized by AS will not be shared with third-party devices." Fang Zhuo said a name that was just named last night, "This is the SPA technology developed by our Yike, which is specifically used for copyright protection."

He threw out another chip: "Also, iMusic can turn off the function of burning to records in mp3 format."

Taylor really felt the sincerity from Yike. He looked at the department head next to him and saw the intention in his colleague's eyes.

The current record market in the United States is sluggish, which is a headache for music copyright agencies and record companies. One of the important reasons is the rise of digital music and its spread on the Internet.

At the same time, the fact that digital music can be freely loaded into records through software also makes AS and SE very dissatisfied.

AS is the most aggressive one, and has sued nearly ten softwares with similar functions, including iMusic, iTunes, McCo, etc., but litigation requires a process, and this process sometimes becomes painful in the efforts of the lawyers.

AS's executive vice president turned his head and discussed in a low voice with his colleagues.

Fang Zhuo breathed a sigh of relief and signaled Yu Hong to hand the file to Taylor.

From the other party's reaction, it can be seen that the existence of music burning software is indeed a headache for music institutions.

About ten minutes later, Taylor gave a formal answer: "Mr. Fang, we feel your sincerity. We need to discuss this further. How about we continue to talk here at this time tomorrow afternoon?"

"No problem."

Fang Zhuo stood up and shook hands with the executive vice president of AS, turned around and left with the team.

Taylor personally escorted the president of Yike out, and then returned to the conference room and said immediately: "Call Apple immediately and tell them that Yike is willing to match their price to see if there is a higher price."

"Also tell them all the changes Yike is willing to make to iMusic, as well as the SPA technology, to see Apple's attitude."

A department manager hesitated and asked: "What about Yike? Do we really have to talk to them tomorrow?"

"Fool, there is a small company that can force a listed company like Apple to increase its price, why don't we choose a better one?" Taylor said indifferently, "The people at Apple are also very positive."

He commented contemptuously: "This is a small company from the East, and I don't know when it will go bankrupt."

The department manager nodded, and it is indeed more attractive to listed companies like Apple.

AS called Apple executives.

Sure enough, the other party attached great importance to the latest offer from competitors.

In just half an hour, Apple's slightly cautious statement came-we are willing to further increase the sales share to 65%, and at the same time make beneficial changes to iTunes.

As for the specific extent of this "benefit", it still needs further evaluation.

…

The seven people who were negotiating business with Yike were very quiet on their way back to the company.

The four Chinese and two local white people were observing the boss's expression, while Fang Zhuo was frowning and thinking.

Before the business car arrived downstairs of Yike, Fang Zhuo suddenly said, "Can we contact SE to meet this afternoon? Anyway, this round is to express important intentions, and it doesn't take much time."

"Sure, Mr. Fang." Qi He, Yike's fastest-promoted overseas marketing deputy director, immediately replied, "SE is the closest to us. If we want to talk to BMI, we have to fly to Washington."

Fang Zhuo nodded: "Then drive there now and contact them on the way."

Qi He immediately took out his mobile phone to contact SE.

Compared with AS, SE has much fewer songs in its copyright library, and previously agreed on a condition of $5 million + 55% share.

"Xiao Yu, you saw it clearly from the side just now, what do you think Taylor and others think?" Fang Zhuo asked Yu Hong.

"I'm not optimistic." Yu Hong said as an observer, "I think Taylor is just using us as a tool to raise prices. They might contact Apple right after we leave."

Fang Zhuo also had such a judgment and exhaled: "Let's see how SE is doing. I suspect that Apple has probably contacted them all."

At four o'clock in the afternoon, the Yike team appeared in SE's office and had a quick business negotiation as expected.

Because of the previous communication with AS Taylor, Fang Zhuo talked about his sincerity more comprehensively this time.

He first talked about the sluggishness of the record industry and the trend of Internet digital music, then talked about the wild growth of digital music on the Internet, and finally about the digital music copyright protection technology that Yike is developing.

In a sense, iMusic benefited from the spontaneous sharing of many users, and the current convergence of software functions will definitely attract dissatisfaction from these people.

But Yike is facing pressure from music copyright agencies and competitors, so it can only choose this way.

The company must survive before considering other things.

Fang Zhuo's negotiation with SE took an hour.

If the previous negotiation with AS could score 80 points, then he thought he could score 90 points this time.

However, 90 points did not get a direct statement from SE, and the other party also had to consider it like AS.

This is actually a normal business process, but it is not good news for Yi Ke, who is competing with Apple and has witnessed AS's attitude.

Working overtime at night, Yi Ke has made an appointment with BMI in Washington for a negotiation the day after tomorrow. The president will still lead the team, and the marketing director will stay in New York. However, everyone still has a glimmer of hope for another round of meetings with AS the next day.

What if our judgment is inaccurate?

What if Apple does not follow up with the conditions?

The next afternoon, Yi Ke and the original team of AS had a second meeting, which produced good news and bad news.

The good news is that Fang Zhuo and Yu Hong's judgment is very accurate.

The bad news is that Apple followed up with the conditions.

AS's intention for the second round is very clear, which is to see if Yi Ke can offer an overwhelming price, or continue to use Yi Ke to force Apple to raise the price in the negotiation.

This is actually normal.

However, the abnormal part is that Taylor showed his intention too obviously, which makes people feel a little uncomfortable.

Seeing this, Fang Zhuo did not talk about anything more, but just gave a near-limited offer of $13 million + 70% share.

AS was still discussing retention just like the first day.

Fang Zhuo did not bother to express his objection, and led his people to fly to Washington to meet BMI in the morning of the third day.

This time the business negotiation took a lot of time.

BMI is different from AS and SE. Its full name is the American Broadcast Music Association. It is the second largest music copyright licensing agency in the United States. The number of songs in its library is only less than AS. Moreover, most of its members are independent musicians, and they are relatively open to the outside world.

It was here that Fang Zhuo finally felt the true intentions of the music copyright agency and made some gratifying progress.

BMI appreciated Yike's efforts in digital music copyright and expressed its willingness to see a better industry atmosphere and promote the development of digital music together.

They also have a relatively positive attitude towards licensing music to Yike.

It's just...

It's just that BMI also bluntly stated that they are also actively open to licensing to Apple.

In other words, BMI wants to eat two meals from two companies. It does not want to sign an exclusive license, but wants to receive money from both companies.

Generally speaking, what people pursue is "I have what others don't have", but in the competitive situation, "I don't have what others have" forces you to have "I have".

Let's not talk about BMI's attitude being the most genuine and positive among the three institutions. Just say that if they don't sign, Apple will directly sign an exclusive contract, which will further weaken their competitiveness...

BMI's request for two payments really surprised Fang Zhuo. In fact, he even admired such a straightforward request.

This time, Fang Zhuo has to think about it a little, mainly because he needs to re-evaluate the conditions.

On September 25, the president of Yike returned to New York and held a meeting to summarize the current trends in contacting music copyright institutions.

The three largest institutions, AS, SE, and BMI, were contacted by the president himself, while other record companies and small and medium-sized institutions were contacted by the company team.

In general, among the ten institutions contacted, the most interested one was BMI in Washington. The others were either waiting for a price, or had contact with Apple, or regarded Yike as a barbarian who destroyed the market.

Fang Zhuo was quite relieved about this "barbarian", which was much better than having contact with Apple.

Fang Zhuo summarized the news and came to a conclusion that iMusic's change conditions were a weapon that could cause institutions to consider, but it was not fatal enough.

"Xiao Yu, do you think we should quickly and heavily decide on a company to cooperate with, so that some people may be sure of their intention to cooperate."

When the meeting was over, Fang Zhuo was not sure about his judgment.

"Are you talking about BMI?" Yu Hong asked.

Fang Zhuo was very troubled: "BMI... This company is indeed not easy to be the first one."

He hesitated for a long time, and still said: "Let's wait and see if there is anyone willing to give in."

Yike's contact with music copyright was very intensive, and therefore it seemed a little urgent, which was very unfavorable for business negotiations.

Now a little cooling down may bring about favorable changes in things.

However, things did not go as planned.

A day later, the New York Times and other media suddenly published a lot of related news, reporting on the copyright purchase behavior of Yike, a Chinese company.

"I was surprised to find that a company from the East China is challenging Apple."

"People from the ASCAP Association revealed that this company called Yike is trying to calm the situation by purchasing music copyright authorization when facing many lawsuits."

"Even though Made in China is gradually appearing in the eyes of New York City citizens, such electronic consumer products are still surprising."

"However, although Yike frequently contacts music copyright agencies and record companies, they have not gained much."

"Because of Yike's previous behavior of destroying the music market, music copyright agencies and record companies are unwilling to license music to this Eastern company."

"Not only that, Yike is still facing serious infringement lawsuits. I am not sure whether this company will go bankrupt due to high compensation."

The New York Times is an influential media in the United States and even the world. Not only is its circulation ranked among the top ten in China, but its website also has a high number of clicks.

The report represented by this content has almost seamlessly produced an impact.

First, there was a clear notice from AS that they would cooperate with Apple in copyright licensing, followed by a statement from SE, which was basically the same as AS. Even BMI, who wanted to get two pieces of money, had a bad tendency.

As for the record companies, they were ambiguous in their attitude and were more concerned about the interests of the records in their hands.

For a time, Yike's external environment deteriorated sharply.

These media reports also brought another negative impact. Fang Zhuo received a call from Li Xinyue of Anlianghui, hoping to have a face-to-face interview on the funds of MIGA Fund.

Fang Zhuo had reason to believe that Li Xinyue had concerns about his overseas activities after seeing the report.

On the evening of September 28, Fang Zhuo issued a decision to offer a small amount of discounts on Yike M1 and P1, trying to consolidate a wave of market conditions in the market where he had an advantage.

At 11 o'clock in the evening, the office was brightly lit, and the employees had gone home after get off work. Fang Zhuo was still looking at a variety of information.

"The situation is a bit bad." Yu Hong gently placed the teacup in front of the boss.

"When did you come? Didn't you go back?" Fang Zhuo didn't notice the marketing director coming in at all, and looked up and smiled at Yu Hong.

"It's work when I go back, and it's work when I'm here." Yu Hong shrugged, "Since I came to the United States, I have really put all my thoughts on work, but I didn't expect the market to change so quickly."

"Apple has made a lot of preparations." Fang Zhuo smiled, and couldn't help lighting another cigarette and holding it in his mouth, "It can't be said to be fast. Our M1 and P1 still have advantages in the market, but if we let it develop like this, this advantage will soon disappear."

The market constraints of digital music are gradually becoming clear. The inability to compete for market share in copyrights foreshadows the suffering in the near future.

"I used to think that I could do something that would be written into MBA textbooks, and now it's really half done." Yu Hong laughed.

Fang Zhuo was also amused: "It's the half that was beaten by other companies, right?"

Yu Hong nodded.

Legal bans, copyright operations, and public opinion tendencies, Apple's accumulated punches completely suppressed Yike. The money and resources involved are indeed the foundation of listed companies.

If Yike fails in the market, then Apple's case of turning the market will definitely be written in MBA business textbooks, because the next is the delicious cake of the digital music era.

"Yike still made money, and it's no big problem for us to return to China even if we fail." Fang Zhuo put out a half-smoked cigarette and said thoughtfully, "But I don't know if Lao Xiong will stab me with a knife this time."

Yu Hong nodded seriously and said, "That's probably nine out of ten, after all, it's not the first time."

Fang Zhuo thought of Xiong Xiaoge's face and laughed.

Yu Hong laughed with him. This was a rare relaxation in recent days, even if it was out of self-mockery.

Ring, ring, ring.

The phone ring at 11:30 in the evening was quite abrupt and penetrating.

Fang Zhuo glanced at the number, frowned, and took the landline.

After a few simple words, he hung up the phone.

Yu Hong was already angry: "Anliang Society? Isn't this adding insult to injury?"

"It's okay. They are already quite polite. They just asked me, fearing that I would return to China without saying hello." Fang Zhuo took a sip of tea, "They are easy to appease. Sina's third quarter financial report is coming out soon, which is a big positive."

Before Yu Hong could speak, the abrupt and penetrating phone call sounded again.

This call was also very short. Fang Zhuo's concise "um ah" response made Yu Hong unable to guess who the other party was.

"Yike's situation is actually not too bad." Fang Zhuo picked up the teacup again and poured half a cup of tea into his stomach, and then said with satisfaction, "Things are compared."

Yu Hong was puzzled.

"The court lawsuit is handled by a law firm. There will not be any major twists and turns for a while. Media reports are temporary. There are so many things every day, and the heat will soon disappear."

"It's about the music copyright. We actually need a partner to demonstrate potential intentions."

Fang Zhuo spoke slowly and analyzed the current situation.

Yu Hong stared at the phone that had just been picked up and asked tentatively, "Who was it just now..."

"It was another unlucky guy." Fang Zhuo answered calmly, "Sony Music."

It is the record company owned by Sony, a competitor that has been challenged and eroded in the music player market.