There's nothing "antitrust" about the App Store operation, since Apple isn't a monopoly -- it's in fact a minority player in the mobile market. (And no, you can't be a "monopoly on your own platform" -- it has to be the overall market).
In fact game console manufactures (among many other fields) have historically had much more draconian restrictions and cuts) that the quite liberal App Store.
And it having 1 million apps and having pushed 50 billion dollars to developers doesn't really paint it as a "restricted area with tight controls where only Apple benefits" either.
The question then becomes not "does Apple have a monopoly," which it obviously does not, but rather "is Apple abusing its position in the marketplace," which leads to the much trickier question of where to draw the line between legitimately using a dominant position and abusing it.
Apple then leverages its monopoly in app stores on Apple's platform into other business (Apple Music, eBooks, digital video, etc). This is anti-competitive behaviour and illegal.
Only legal gap is declaring Apple's app store on its platform a monopoly, the second that is done then everything else naturally falls into place and Apple receives antitrust violations.
Not in the legal sense of the word, so no.
To put it simply, monopoly is not "only a company dictates the rules/has near total share/control of their own marketplace/platform".
It's "only a company dictates the rules/has near total share/control of the general market".
Since that hasn't been ruled on, we won't know that until it has.
> It's "only a company dictates the rules/has near total share/control of the general market".
That's a strange definition, but even taking it, the market has yet to be defined by a court. As I've said elsewhere courts have already expanded competition law into securities, they literally declared it a market allowing them to use anti-monopoly controls.
1. "Every contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce among the several States, or with foreign nations, is declared to be illegal."
which is, extremely vague.
I think you are right, intuitively, creating a mobile platform on which only your approved vendors may sell is not breaking anti-trust because you created that platform and there was conspiracy or anti-trade sentiment involved in just the platform getting popular. Certainly we can agree it would not be a monopoly if the iphone only had a market of a few thousand people and apple controlled the app store.
At the same time, the law is so vague that it could easily be applied to Apple. All the Sherman anti-trust act seems to require is some kind of interstate or foreign trade (to bring it under Federal Jurisdiction) and a large control of any kind of Trade, which it seems to me could be applied against Apple on the whim of the Feds.
The question a judge would ask if this came to court is does the app store constitute a monopoly and is apple using that monopoly to it's advantage to crush competition. And I think the app store is a monopoly and of course when you have a monopoly you are going to use it to prevent people from competing with you.
No, it isn't. There is Google Play, Microsoft, Amazon, and a whole host of other app stores out there. Remember, the market is mobile devices altogether, not just iOS devices.
"Only legal gap is declaring Apple's app store on its platform a monopoly, the second that is done then everything else naturally falls into place and Apple receives antitrust violations."
Which will not happen, because you can't have a monopoly on your own platform.
Apple has banned all of those from iOS. It allows no third party app stores.
> Remember, the market is mobile devices altogether, not just iOS devices.
You cannot just tack on the word "remember" to make something an established fact. We don't know what the scope of future legal decisions will be until they're in fact made.
> Which will not happen, because you can't have a monopoly on your own platform.
You, nor I, have any way of knowing or proving that. This will likely go to SCOTUS in our lifetime, until that happens we won't know the scope of what is a monopolistic market.
Which is irrelevant, as Spotify can still sell apps through those stores. Remember, the market is mobile as a whole, not just iOS.
"You cannot just tack on the word "remember" to make something an established fact. We don't know what the scope of future legal decisions will be until they're in fact made."
It is currently an established fact. If that changes, then we will have to revisit. But as of now, it stands.
It hasn't been ruled on. So, no, it hasn't been established.
> Remember, the market is mobile as a whole, not just iOS.
Why are you copying and pasting? I won't reply to this again, you already posted this above.
Rephrasing the same thing, while refusing to understand terms with clear formal definitions, is not that different from copying and pasting.
It was a copy/paste, they changed literally one word, and ignored my response to that same point above.
Yet, you continue to say the same thing in every one of your comments, trying to define the market so as to ignore other mobile OSes. If you're going to post the same thing, then expect to get the same responses.
Play your purchased iTunes movies locked with Fairplay DRM?
Read your purchased iBooks?
Read your personal documents, passwords, and data locked into iCloud?
Synchronize with your other Apple iCloud-only devices?
At some point, product tying results in lock-in far more costly to escape than, say, a video game console with platform-only titles.
TiL
There were 6 factors considered in establishing the relevant market in the Microsoft case (paraphrasing Court's Findings of Fact, §2)[0].
A) Servers were not cost-effective replacements for consumer hardware and were excluded from the relevant market. It's not clear whether the discrimination also goes the opposite way (e.g. instead of "smartphones" we compare "flagship smartphones"). If so, that kind of market definition would really make iOS look gigantic.
B) PowerPC and other non-Intel-compatibles were excluded from the relevant market since consumers could not install the competing OS on their hardware (that's right, "the relevant market" was constructed so as to exclude Apple, MS's only serious competitor). It is an interesting question whether the fact that you can't run Android on your iPhone for non-ISA reasons would be viewed similarly to an ISA difference in the hardware, but the way I read the ruling, it seems likely to be viewed similarly, or perhaps much worse. The reasoning all stems from whether consumers have choices to install their own OS, nothing to do with ISAs per se.
C) Various "borderline formfactors" were excluded from the relevant market. In the 90s this was e.g. WebTV, thin clients and game consoles. Today this might be things like tablets, VR platforms, chromebooks, etc. These are (today) all Android form factors, and excluding them to focus on "traditional" formfactors makes iOS look a bit larger than it does in Netcraft surveys.
D) The court observed that market conditions create a feedback loop, e.g. more people write apps for the dominant platform, that make the dominant platform more attractive to write apps for, round and round it goes, etc. This is obviously true for the smartphone market.
E) The court was concerned that nobody could realistically enter the market and "in less than a few years, present a significant percentage of consumers with a viable alternative to incumbents." This seems probable for the smartphone market, based on Mozilla and Canonical's misadventures, RIM and Nokia's inability to make a comeback, and even Windows Phone.
F) There was also a discussion about why "portals" (like today's cloud computing and/or webapps, basically) are not an effective substitute for doing computing locally and should not be in the relevant market, as well as a discussion of why Java is not a substitute for Windows (obvious to us, but not to lawyers)
All of this to say, it is really not so obvious from a legal POV why Apple are not a monopoly or are in any way different fro the Microsoft case. The real reason is probably nobody wants to sue them; I have seen estimates of the Microsoft case that suggests MS spent more than $500M defending it, and the taxpayers (with much cheaper lawyers) spent more or less $100M to prosecute it and didn't get much for their money.
Then there is the question of who gains by spending that money: Apple is well-loved by their customers so it doesn't have the election appeal for politicians that the Microsoft case did. Google would prefer to implement Apple-like policies in their store and don't want them found to be illegal. That leaves bit players like Canonical or Mozilla, and for them the legal costs are likely prohibitive.
[0] https://www.justice.gov/atr/us-v-microsoft-courts-findings-f...
Is it? Android dominates mobile marketshare. Yet iOS is not hurting for apps.
Everything else considered, you would have to make an extreme stretch to say that the app market does not include Android.
Windows phone is dead. BlackBerry is dead. Palm OS. The previous versions of Windows Phone. The Sidekick. Amazon Fire Phone. Canonical's phone, the Firefox phone, whatever other Linux phones I can't think of.
It doesn't matter how big the company backing it is, even if they actually do a good job (like supposedly the recent Windows Phones). At this point the first mover advantage for Android and iOS are too big. Even if you spend all the time to make a great platform no one's going to buy it because the top hundred or thousand apps aren't available. Because no one's gonna Byatt know it's gonna make apps for because there's no one to buy the apps. You're stuck in a cycle.
Microsoft tried to buy their way out of it, and blackberry did too to a degree. But it doesn't matter if you pay to get the top 40 apps from iOS, because nobody uses all of them. They use some percentage of the top hundred apps. Or 500 apps. So every users going to have a couple of apps that they really want that are unavailable and will never get ported. The apps that do exist (like Twitter and others) often don't get updates, and if a game or something does come out for the platform it's not until years after the big two.
Until something very different comes along, or some HUGE external force appears, we're only going to have two big phone OSes. The only thing that slightly possible (in my eyes) would be someone as big as Samsung pushing their own OS in other countries and possibly getting a good foothold there. Maybe Xaiomi.
https://gigaom.com/2013/08/23/in-ebook-case-doj-claims-apple...
Except Spotify for example start to spent millions to push it.
Spotify shouldn't have to spend millions to push it. It's a criminal matter not a civil case. The DOJ is duty-bound to investigate complaints.
The same things hold true for the non-digital age. If you open a store you can do everything you want in it (within the law of course, can't e.g. refuse to serve blacks), specify how you want it to be run, and sell or not sell whatever you like.
Doesn't matter if it serves millions or billions (e.g. McDonalds), as long as there are other vendors with a large aggregated share selling the same goods, you're not a monopoly.
Nor does it make sense to.
This essentially boils down to: Apple built the iPhone, and they've built iOS SDK, and they've build the App Store, but I, who didn't have anything to do with creating those, want to go there are sell stuff and not be bound by any rules Apple dictates.
Sure, one could say "that would be better for the customers", but it's not the customer's store. It's Apples (or Google's, etc).
If you want to sell in it, it means you see value in what Apple built (and possible profit for you), but yet you don't want to pay the requested price for this value -- and you feel entitled that you don't have to either.
The geographic model is based on the obvious notion that it's unreasonable to expect people to simply pack up and move to a different city to get access to a different vendor.
Given the amount of lock-in inherent in these platforms, it seems pretty clear that people can't simply drop their current platform and switch to another one just to access to a different vendor.
Spotify, if they allow subscriptions purchased in app, is paying Apple for a service. They're free to think that price is way the hell to high and not sell there.
What if Spotify got their way? What if any app could embed their own payment system minute? Now Apple has hundreds of millions of users who could easily be defrauded and have their credit card stolen from stuff downloaded from their store. They get sued.
As a user, I wouldn't use any of them. The reason I buy so much on iOS is because I trust Apple. I know that if I signed up for a subscription for something it turns out to be a piece of junk, I can easily cancel it with one click. No weird cable company style negotiations. No worrying if some unscrupulous company is going to steal my credit card. Apple has some pretty reasonable reasons for this policy (besides all the obvious selfish/monetary ones).
No, they don't get sued.
> As a user, I wouldn't use any of them. The reason I buy so much on iOS is because I trust Apple. I know that if I signed up for a subscription for something it turns out to be a piece of junk, I can easily cancel it with one click. No weird cable company style negotiations. No worrying if some unscrupulous company is going to steal my credit card. Apple has some pretty reasonable reasons for this policy (besides all the obvious selfish/monetary ones).
Then Apple should let you as a user decide whether to use those apps. Apple should let other users decide if they prefer Spotify's billing/tracking in-app. After all Apple would still control the iOS App Store so they can ban any unscrupulous companies that try to steal credit cards. It's absurd though that Apple insists that beforehand that they are the only billing/subscription company that their iOS customers can trust; Amazon for example has been handling ecommerce longer than Apple
¯\_(ツ)_/¯ because it's anti-competitive and anti-consumer?
There used to be a type of monetization strategy in the USA known as 'company towns': https://en.wikipedia.org/wiki/Company_town
The company owned the land, built the stores, so it only seemed right that they payed their workers in scrip and only allowed merchants to accept scrip in the town, yes? Eventually the country decided that such monetization platforms were too controlling and unfair...
Would you disagree if this was a startup whom had built an app store over a decade and was getting violated?
I am not a fan of jagurnaut tech companies but the rules are the rules. They built it and from what I can see (I am an IOS developer) the payment system is indeed in violation.
The guidelines clearly say that apple payment system MUST be used. It doesn't matter if you are Spotify or an indie game dev.
is 30% steep? absolutely! But hey if it was my business I would love it its a great margin - so would you.
Bottom line is Spotify is in violation and they don't want to pay the 30% which Is understandable but Apple will not budge because they don't half too.
TLDR; "Apple to Spotify: Kiss my Ass".
Apple is saying "we're providing a value-add, pay us" but not allowing developers to price it in to their balance sheet.
You use them to advertise your site where customers can get a discount if you bail from the app store and buy from you directly. So many developers would try that oh so clever trick that they already know better in advance.
Unless you're one of the anomalies who actually does a better job at driving traffic to your apps than they can, it makes no sense to complain about this.
If you call the shop and mention using Groupon, most of the time they ask you not to purchase the Groupon. They still honor the discount, but avoid a 50% take by Groupon.
That's not true at all. In fact, Spotify did have IAP in the app, and they charged an extra $3 for it.
The specific, supposed violations weren't mentioned in the article. It was just mentioned, as an aside, that Spotify claims Apple is pressuring them into forcing all iOS Spotify users through Apple's pricing scheme.
If the violation were that Apple was forcing Spotify to pay Apple 30% for subscriptions, then that would be a very clear breach of the spirit of anticompetitive laws in the United States, considering the existence of Apple Music, and considering that it would force Spotify to either raise its prices and reduce its consumer appeal or take a substantial, perhaps fatal, revenue cut.
Spotify is trying to have it both ways here.
I trusted Spotify enough to sign up directly via their website, but for many apps I do not, and prefer to pay via the app store as I trust Apple.
In my personal opinion, this experience is pro-consumer. I can make an informed choice. Hence I don't take any issue with Apple requiring developers to a) pay a cut for the privilege of using their store, and b) impose publishing requirements to maintain the standard of apps.
Windows Phone is dead (even if its market share is >1%, I believe the project has been abandoned) and BlackBerry OS is hanging on but holds a trivial share of the market.
Duopoly? No, more like Apple and Google are the only good companies out there.
And that didn't came from anti-competitive behaviors, but from HARD WORK.
Things like Google Maps and Apple Stores are cold hard work that are really meaningful for people's quality of life.
Amazon and others don't give any of this to the consumer, that's the reason nobody wants to go with their platforms.
I wonder if this is also a reflection on broader society too
because it is very very inaccurate.
and by happen, I mean filed in a court.
There is nothing "applied equally" to other developers. Onlookers will say developers agreed to the contract, so no sympathy, a Federal Judge on the other hand will rip that contract to shreds and take a dim view on Apple's practices.
And no, Google Play's robo rejector isn't exempt.