Apple Fined $12 Million in Russia for Violating Anti-Monopoly Rules With App Store

[the8thark]

$12m fines are pointless. It's just the cost of doing business for Apple.
Apple would happily pay $12m so keep doing these practices. FInes need to actually hurt Apple's pocket. $100m or more, or threaten jail time for the Apple CEOs. I know that's not possible, so it just makes these small fines worthless as a deterrent.

 

[coredev]

Boom! Another domino falls. Yet another international regulator affirms that the ascendent definition of "market" for competition regulation and antitrust purposes is defined by platform, eg iOS, (and Android), and not "Smartphones" as a whole.

iOS is A market, Android is A market, and competition regulation is to operate within each of them in isolation, when considering how platform owners wield power within those markets.

This will continue the trend whose eventuality will potentially render as moot Apple's primary argument - that by selling fewer phones than all Android makers put together, they are by definition incapable of being considered to have monopoly power.

Ah, so looking forward to sue eBay for abusing their eBay marketplace monopoly to raise fees again and again.

 

[Krizoitz]

BUT the trend amongst regulators world-wide is that "smartphones" isn't regarded as a "market" for competition purposes, and iOS is.

Stating something doesn't make it a fact.

 

[mattspace]

Ah, so looking forward to sue eBay for abusing their eBay marketplace monopoly to raise fees again and again.

Buying a product from an EBAY seller, does not require you to sell the product later on EBAY. There are no products sold on EBAY which can only be sold on EBAY.

A website, and an operating system are different things, and not comparable for regulatory purposes. This isn't rocket surgery.

 

[mattspace]

Stating something doesn't make it a fact.

When it's a regulator that states it, it does.

 

[coredev]

Buying a product from an EBAY seller, does not require you to sell the product later on EBAY. There are no products sold on EBAY which can only be sold on EBAY.

And every app developer is free to develop their app for another OS or platform. Or in case of services, not have an app at all and be web only.
What I am saying is that every developer spending time and money to develop for iOS should read the terms and conditions _first_ and be very sure that they agree and can live with them. If not, go make your money elsewhere. It's really that simple.
Just like I don't _have_ to sell stuff on eBay if I don't like their conditions, no developer needs to bring their stuff to iOS.

 

[ksec]

Russia market Russian rules.

Apple's market Apple rules.

 

[mattspace]

And every app developer is free to develop their app for another OS or platform. Or in case of services, not have an app at all and be web only.
What I am saying is that every developer spending time and money to develop for iOS should read the terms and conditions _first_ and be very sure that they agree and can live with them. If not, go make your money elsewhere. It's really that simple.
Just like I don't _have_ to sell stuff on eBay if I don't like their conditions, no developer needs to bring their stuff to iOS.

I'm sorry you can't come to terms with this, but the people who make and enforce the laws don't seem to share your opinion. Exiting the market entirely is not what competition regulators consider an acceptable alternative to an abusive market owner. And, as regulators are consistently saying, Android is not an alternative platform to iOS within a larger "Smartphone" market, they are separate, non-interchangable markets, for competition regulatory purposes.

Just because a contract has terms, does not make those terms binding, or legally enforceable - the contract has to comply with the regulations of the jurisdiction in which it is being evaluated.

As we see from Australia's ACCC today, yet another regulator is offering the opinion that iOS and Android are separate markets in of themselves, and therefore the companies who make the operating systems cannot use that position to reduce competition for *any* aspect of the user's experience - be it web browsers, email clients, music streaming services, or app stores, or payment processing services.

 

[ksec]

Entirely wrong analogy, for starters, BK isn't open to other vendors to sell in their shop...

But that's besides the point, because you fail to grasp the difference between having a monopoly and abusing the monopolistic position---the former is not outlawed anywhere, AFAIK, the latter is frowned upon everywhere, AFAIK! Perhaps you like people telling you what you may or may not do with things you spend good money on, others might take a different view...

Yes. And No wonder why the world is so divided.

For one, BK doesn't control 65% of all burger market in the US, nor does it forbid or has large market entry cost for selling a burger.

These people like to argue about what is or what is not a "monopoly", when the argument is if Apple have used monopoly power for anti competitive reason. The first argument is much easier to understand, the latter seems to be hard to grasp by many people.

 

[Krizoitz]

When it's a regulator that states it, it does.

A regulator. In Russia. Yeah that’s a real solid case you got there. A country well known for respecting people’s rights 🤣

Putin and Russia simply want greater ability to track and spy on users. To mistake this for anything but an attempt to wrest more control from Apple is folly.

 

[Denzo]

L

"Apple occupies a dominant position with a 100% share of the market for mobile apps based on the iOS operating system"

Cool, let me try this.

"Sony occupies a dominant position with a 100% share of the market for console apps based on the Playstation operating system"

"Nintendo occupies a dominant position with a 100% share of the market for console apps based on the Nintendo operating system"

"Microsoft occupies a dominant position with a 100% share of the market for console apps based on the Xbox operating system"

"Youtube occupies a dominant position with 100% share of the market for videos based on the Youtube platform"

"Google occupies a dominant position with 100% share of internet search based on the Google platform"

"Alexa occupies a dominant position with 100% share of smart home skills based on the Alexa platform"

"Twitch occupies a dominant position with 100% share of live streams based on the Twitch platform"

Literally what everyone is thinking. Great post and what a ridiculous charge. Or in layman’s terms “I can’t sell my **** on my ****”

 

[mattspace]

A regulator. In Russia. Yeah that’s a real solid case you got there. A country well known for respecting people’s rights 🤣

Putin and Russia simply want greater ability to track and spy on users. To mistake this for anything but an attempt to wrest more control from Apple is folly.

That it's a Russian regulator is irrelevant, increasing regulation is a trend - Putin has no more power to spy on Russians than any government at present has, or uses.

 

[Krizoitz]

That it's a Russian regulator is irrelevant, increasing regulation is a trend - Putin has no more power to spy on Russians than any government at present has, or uses.

🤣🤣🤣🤣🤣🤣🤣

 

[I7guy]

[…]

This is why car companies can't stop third parties selling alternative-to-manufacturer's components.

[…]

But if the part breaks the car you’re on your own. The manufacturer is under no obligation to fix the damage under warranty.

As for the rest, I don’t see any fundamental changes, at least not a direction apple hadn’t been headed in.

 

[1258186]

And Burger King has a Monopoly, with 100% control over their Whopper.

This is ridiculous…!

You don’t understand the argument. Burger King sells their own brand products whereas Apple is selling other peoples products. If the AppStore only sold Apple made apps I would agree with you but they don’t. Apple has a monopoly on the sale & distribution of iOS apps.

 

[IG88]

Well, Apple must have accomplished something amazing: violating anti-monopoly rules without actually having a monopoly. How do they do that? 🤯

As of a year ago, there were 1.5 Billion active Apple devices. 900M of them being iPhones. And Apple has has monopoly control over installing apps.

 

[Spanky Deluxe]

You do realize a 12 million dollar fine to a trillion dollar company is equivalent to a fine of $1.20 to someone making 100K/year? 0.0012%.

”Hey Apple, pay us for a chocolate bar, our Oligarch is hungry”

As of this morning, APPL’s market cap is 2.26 TRILLION. With a T.

Yes, it's next to nothing for Apple but your calculations are wrong. Apple might be a "trillion dollar company" but they do not make a trillion dollars each year. Their market cap is just that, which means the market value of all of their shares and traded shares are generally pretty inflated by traders' opinions. It doesn't work in your comparison to someone's earnings. Their operating income in 2020 was $66.288 billion, that's a better figure to use. So a 12 million dollar fine to Apple is like a fine of $18.10 to someone making $100k/year. 0.018%. Still chump change ofc. I'm just being pedantic and pointing this out because it's a mistake lots of people make when they make comparisons between annual incomes and net values, for both companies and individuals. Especially when share prices for some companies have become so ridiculously decoupled from actual profits (e.g. Tesla) .

 

[coredev]

As of a year ago, there were 1.5 Billion active Apple devices. 900M of them being iPhones. And Apple has has monopoly control over installing apps.

In a way they do. However it's not that hard to get an app into the app store, so they are not abusing this monopoly power. A vast majority of developers are happy with the status quo, and so are iPhone users. They know where to download apps, look for options for a certain use case, and can be pretty sure that whatever they are installing does not contain malware, trojans, viruses and other unwanted crap.

 

[DekuBleep]

I saw fine, and then I saw Russia, and I was like oh yeah.

 

[Toratek]

I'm just being pedantic

Yes, you are. Perhaps you’re the type that would correct a friends bar story, in the middle of the story. It was a joke, and most people understand that. (Next you’ll tell me that Russian oligarchs are on keto diets and never eat candy bars, right?)

 

[Solomani]

I'm surprised Apple's business is profitable in a country like Russia. An extremely hostile government, and a tremendously high presence of hackers, scammers, software pirates, and a legendary heartland of malware.

Apple risks more to lose in countries like that than they have profit to gain.

 

[Spanky Deluxe]

Yes, you are. Perhaps you’re the type that would correct a friends bar story, in the middle of the story. It was a joke, and most people understand that. (Next you’ll tell me that Russian oligarchs are on keto diets and never eat candy bars, right?)

Your second line was a joke, the first was not and was a comparison which used specific numbers and was incorrect. Your comparison is like saying that a fine of $20 for someone that earns $200,000 a year is the same as a fine of $20 for someone who lives in a house worth $200,000. It's comparing apples to oranges when your point can equally be made by comparing apples to apples. You don't need to use incorrect numbers and doing that just propagates further misunderstanding as to what the value of things are.

 

[TheWatchfulOne]

As of a year ago, there were 1.5 Billion active Apple devices. 900M of them being iPhones. And Apple has has monopoly control over installing apps.

And how many Android devices are there? More right? Those devices can get apps from Google Play. Doesn't Samsung have an app store too for Samsung Android phones?

Apple has no monopoly.

 

[TheWatchfulOne]

They did because of the specific definition of monopoly used by the Russians. Kinda like the specific definition of monopoly you used to craft your quote. But I'm guessing you already knew that because Russia's reasoning is defined in the article:

If we use different definitions for the same word, we'll never reach an agreement. I didn't read the whole article. But, now that you've pointed out Russia's definition of monopoly, I can say I disagree with it.

And now that I've re-read Russia's definition a few times, I still don't agree there is a monopoly, even by Russia's definition. Because anybody that wants to sign up to be an Apple developer and put their app in the App Store. Most of the apps available aren't developed by Apple. That's using Russia's definition which reads more like it has to do with the percentage apps available for iOS.

 

[69Mustang]

If we use different definitions for the same word, we'll never reach an agreement. I didn't read the whole article. But, now that you've pointed out Russia's definition of monopoly, I can say I disagree with it.

And now that I've re-read Russia's definition a few times, I still don't agree there is a monopoly, even by Russia's definition. Because anybody that wants to sign up to be an Apple developer and put their app in the App Store. Most of the apps available aren't developed by Apple. That's using Russia's definition which reads more like it has to do with the percentage apps available for iOS.

If every word only had one definition, you'd have a point. They don't and you don't.
It seems you've misinterpreted what you read in the Russian explanation. The Russians are claiming Apple has a 100% share of the actual app market (the App Store), not a 100% share of the apps in the market. That wouldn't even make any sense at all.

Not really sure what definition of monopoly you used, but the Russians seemed to have based theirs interpretation on the definition of an economic monopoly: A monopoly is a specific type of economic market structure. A monopoly exists when a specific person or enterprise is the only supplier of a particular good.

Apple is the one and only supplier of iOS hardware, the operating system (iOS), and the marketplace for iOS apps.
There is no substitute. If you want iOS in any form, it's only coming from Apple. That's what the Russian are claiming is a monopoly.