Vivendi calls Apple iTunes contract terms "indecent"

By Astrid Wendlandt

PARIS (Reuters) - Vivendi condemned as "indecent" the contract terms between its Universal Music Group (UMG) unit and Apple Inc, the computer maker whose iTunes online store dominates the digital music market.

Vivendi is one of many large media companies that are trying to challenge Apple's grip on the digital entertainment market and obtain more control over pricing. It said it was in talks with rival distributors.

"The split between Apple and (music) producers is indecent ... Our contracts give too good a share to Apple," Vivendi Chief Executive Jean-Bernard Levy told reporters at a gathering on Monday organized by the association of media journalists in France.

At present, UMG, the world's largest record company, gets 0.70 euro ($0.99) out of the 0.99 euro retail price charged by iTunes, Vivendi said.

Among other things, Levy called for the remuneration of a new release to be higher than for a 30-year-old classic. "We should have a differentiated price system," he said.

UMG renews its music distribution contracts with Apple every month after having failed to agree a longer-term arrangement earlier this year.

The music publisher can end its contract with Apple at one month's notice, but Levy declined to say whether UMG was ready to bypass Apple altogether.

"We are in a phase during which many different actors are talking to each other ... We are trying to put in place several projects to ensure that music is better remunerated ... We are not just talking to Apple," he said.