It looks like the guy is a graduate from 
  Stanford's business school... and is the 
  co-founder of Pricenomics. What the heck.

Many guides to using apostrophes [1,2,3,4] say they can be used for contractions (the dog's outside) and to indicate possession (the dog's ball) - Why shouldn't something possessed by "it" use a possessive apostrophe?

Some people tried to correct my using of "it's" to indicate possession by explaining "Apostrophes are used for contractions like it is" which was unconvincing as obviously they can be used to indicate possession.

It wasn't until I got to college that someone gave me a satisfactory explanation: It/Its belongs to the same class of words as he/his, her/hers, your/yours, who/whose which do not follow normal apostrophe usage rules as the rules are descriptive, not prescriptive and nothing obliges the language and its users to be consistent.

[1] http://www.economist.com/style-guide/apostrophes [2] http://www.angryflower.com/bobsqu.gif [3] http://lilt.ilstu.edu/golson/punctuation/apostrophe.html [4] http://theoatmeal.com/comics/apostrophe

A teacher taught me a simpler rule: "It's" normally has an apostrophe, while most words don't. So instead of adding a apostrophe to show possession, we remove it.

Basically we're toggling the apostrophe state. Or..."it's" always results in a NOT output when compared to other outputs.

Edit: sorry Clicks it was too tempting :)