Early last week Apple's iTunes seemed to be suffering from too much of a good thing. Post holiday shoppers overwhelmed the download store causing slowdowns and error messages. By week's end t hose issues seem resolved, but other problems are plaguing Apple and CEO Stebe Jobs.
The company is the target of a number of major lawsuits including several that have gained broad class-action status. Of most interest to the music community is one that takes Apple to task for copy-protection that prevents iTunes music and video from playing on rival players and makes songs purchased elsewhere un-playable on iPods. The court denied Apple's motion to dismiss on Dec. 20.
These lawsuits were revealed in Friday's two week late filing with the Securities & Exchange Commission which admitted that the company had illegally backdated stock options. Apple claimed that Jobs who admits to having been aware of the unlawful practices was somehow not at fault blaming to former execs. The SEC is pursuing Apple in the courts.
Wall Street didn't care and rewarded Apple's stellar holiday showing with a jump of 4.9% on Friday to close at $84.84 on the NASDAQ. Apple and Jobs have managed to obtain mythic status and the iPod dominates the portable player market. But legal troubles may only the beginning of Apple's troubles as a new array of competitors fight to gain market share and consumers demand alternatives to restrictive DRM and high fixed prices.