I really doubt most developers chafe at Appe's rules and will abandon a store that is very lucrative for them.
I have no doubt some will leave to make a statement, which is perfectly fine; and some apps will spring up that offer features unavailable under today's rules. I also suspect, as we have seen in the Mac world, as iOS eveloves some apps that do provide such features stop working as Apple changes how iOS operates.
It will be interesting to see what open source apps come about.
Well it’s not that they will abandon it for a statement ( it’s still business after all) but more that unless Apple adapts and starts improving their AppStore, it’s very likely the killer apps/ games will only be available on alternative platforms because they can’t be published in the AppStore. Example the ban on selling virtual machines allowing you to run non iOS apps and games etc.
And for me I really just want a decent AppStore for my iPhone >.>
It is, however, based on the premise iOS is its own market and not part of a broader phone OS market. The validity of the metrics depends on the validity of the definition of "market."
Well this definition is very clear cut. The Supreme Court have already ruled against Google android playstore that Apple AppStore isn’t a competition nor a relevant market.
Here I will describe loosely how EU would do it( and did it) with iOS.
he European Union (EU), particularly through the European Commission, approaches the definition of relevant markets in digital and technology cases with careful consideration of the unique characteristics of these markets, such as network effects, user dependency, and the closed nature of ecosystems like iOS. When defining the iOS App Store as a relevant market, the EU would follow a structured analysis to determine whether the App Store constitutes its own market or if it is part of a broader market.
Steps to Define the iOS App Store as the Relevant Market:
1. Identify the Product Market:
• Demand Substitutability: The EU would first examine whether users of the iOS App Store can easily switch to alternative app distribution channels if they face a price increase or reduction in service quality. Since Apple’s iOS operates as a closed ecosystem, where apps must be downloaded through the App Store, this would likely lead to the conclusion that the iOS App Store is not substitutable by other app stores like Google Play, Amazon Appstore, or other platforms.
• Supply Substitutability: The Commission would analyze whether app developers could easily switch to other distribution channels (like offering apps on Google Play) if Apple increased its commission fees or imposed stricter rules. Given that iOS and Android are distinct platforms with limited cross-platform compatibility for apps, the supply side would also support treating the iOS App Store as a separate market.
2. Examine the Ecosystem:
• Locked-In Users: The EU would consider the “lock-in” effect for users who have invested in the iOS ecosystem through purchases of apps, subscriptions, and devices. The high switching costs to another platform, such as Android, reinforce the idea that the iOS App Store operates in a distinct market.
• Developer Dependency: Similarly, the dependence of app developers on accessing iOS users through the App Store further supports the idea of a separate market. Developers targeting iPhone or iPad users have no alternative but to go through Apple’s App Store, which strengthens the argument for market segmentation.
3. Consider the Geographic Market:
• Global or Regional: The Commission would analyze whether the iOS App Store operates under uniform conditions globally or if there are significant regional differences in its operation. Given that the iOS App Store has uniform global policies but might face varying degrees of competition in different regions, the Commission might consider both a global and EU-specific market analysis. However, the tendency is to define it as a global market, given the standardization of Apple’s practices worldwide.
4. Assess Market Power and Dominance:
• Market Share Analysis: The EU would examine Apple’s market share in the app distribution market. Given that Apple controls 100% of app distribution on iOS devices, the Commission would likely conclude that Apple holds a dominant position in the market for app distribution on iOS devices.
• Barriers to Entry: The Commission would assess whether there are significant barriers for new entrants to compete in the app distribution market for iOS devices. The closed nature of Apple’s ecosystem, where no alternative app stores are allowed, would be considered a high barrier to entry, further supporting the idea that Apple operates in a separate market.
5. Precedents and Case Studies:
• Google Android Case: In the Google Android case, the EU defined the relevant market as the market for app stores on the Android platform, separate from the iOS App Store. The reasoning was based on the lack of substitutability between the two platforms for both users and developers. This precedent indicates that the EU would likely define the iOS App Store as its own relevant market, following similar logic.
• Apple App Store Investigations: The EU has already opened investigations into Apple’s practices related to the App Store, particularly focusing on how Apple’s policies may harm competition by restricting other digital content providers’ access to iOS users. In these investigations, the Commission has treated the iOS App Store as a relevant market, examining Apple’s potential abuse of dominance.
6. Analysis of Competitive Harm:
• Impact on Competitors: The EU would investigate how Apple’s practices within the App Store affect competition. For example, by forcing developers to use Apple’s in-app payment system and charging commissions of up to 30%, the Commission might argue that Apple’s control over the App Store harms competition, both by reducing developers’ profit margins and by potentially inflating prices for consumers.
• Consumer Harm: The Commission would also consider the impact on consumers, particularly whether Apple’s dominance in the app distribution market leads to higher prices, reduced choice, or stifled innovation.
Conclusion:
The European Commission would likely define the iOS App Store as a relevant market on its own, distinct from other app stores like Google Play, based on the lack of substitutability for both consumers and app developers, the high barriers to entry, and the closed nature of the iOS ecosystem. This approach would be consistent with how the Commission has previously handled cases in the tech sector, such as the Google Android case, where different app stores on different platforms were treated as separate markets.
But now we look at the Mac AppStore if it’s looked though the same lense.
If the European Commission were to analyze the Mac App Store instead of the iOS App Store, the process of defining the relevant market would involve some key differences due to the distinct characteristics of the macOS ecosystem compared to iOS. The analysis would need to account for the more open nature of macOS, the availability of alternative software distribution channels, and the different user and developer behaviors associated with macOS.
Key Differences in Analyzing the Mac App Store:
1. Product Market Definition:
• Demand Substitutability:
• Unlike iOS, macOS allows users to download and install applications from various sources, not just the Mac App Store. This includes direct downloads from developers’ websites, third-party app stores, and other distribution platforms.
• Given this, the Commission would likely consider whether users see the Mac App Store as one option among many, rather than the sole or primary source of applications for macOS. This broader range of alternatives would likely lead to a conclusion that the Mac App Store operates within a broader software distribution market, rather than being a market on its own.
• Supply Substitutability:
• Developers for macOS can distribute their applications through multiple channels. This flexibility means that the Mac App Store is just one of several distribution options for them, unlike the more restrictive iOS environment. This supports the argument that the Mac App Store does not constitute a separate market but is part of a broader market for macOS software distribution.
2. Ecosystem Considerations:
• Openness of macOS:
• The macOS ecosystem is more open compared to iOS, where apps must go through the App Store. On macOS, users have more freedom to install software from a variety of sources. This openness means that the Mac App Store does not have the same kind of lock-in effect as the iOS App Store.
• Consumer Behavior:
• The behavior of macOS users is also different; they are generally more accustomed to downloading software directly from the web or from other platforms, reducing the dependency on the Mac App Store. This would lead the Commission to view the market as including all channels through which macOS software is distributed.
3. Geographic Market Definition:
• Global Reach with Local Nuances:
• Like the iOS App Store, the Mac App Store operates under uniform global policies. However, the competitive landscape for macOS software may vary by region, depending on the availability of local alternatives, language-specific apps, or regional market shares of macOS versus other operating systems.
• The Commission might consider a global market definition but also analyze whether specific regional markets need separate consideration, especially if there are significant differences in software distribution practices or competition levels across different regions.
4. Market Power and Dominance:
• Market Share Analysis:
• Given the availability of alternative distribution channels, Apple’s market share in the macOS software distribution market would likely be lower than in the iOS App Store market. The Commission would examine how much of the macOS software market is actually captured by the Mac App Store compared to direct downloads and other channels.
• Apple might not be considered as dominant in the macOS app distribution market as it is in the iOS market, unless evidence shows that a significant portion of macOS apps are still distributed exclusively through the Mac App Store and that this dominance is being used to stifle competition.
5. Barriers to Entry:
• Lower Barriers:
• The barriers to entry for distributing macOS software are generally lower than for iOS, since developers are not required to go through the Mac App Store. This open environment would lead the Commission to recognize a more competitive market landscape.
• The Commission would consider whether Apple’s practices with the Mac App Store (e.g., app review policies, commission fees) create barriers for developers compared to other distribution methods, but these barriers would likely be seen as less restrictive than on iOS.
6. Analysis of Competitive Harm:
• Impact on Competitors:
• The Commission would look at whether Apple is using its control over the Mac App Store to disadvantage competitors. For instance, if Apple were prioritizing its own apps or services in the Mac App Store or imposing unfair terms on third-party developers, this could still raise concerns, but the impact would be less severe given the availability of alternative distribution channels.
• Consumer Impact:
• The potential harm to consumers might be less pronounced in the macOS context, as users have more options for obtaining software. The Commission would consider whether any restrictive practices by Apple in the Mac App Store result in higher prices, reduced choice, or hindered innovation, but these effects might be less significant than in the iOS context.
Conclusion:
In analyzing the Mac App Store, the European Commission would likely define the relevant market more broadly than it would for the iOS App Store. The market would likely include all distribution channels for macOS software, not just the Mac App Store, due to the openness of the macOS platform and the variety of alternatives available to both users and developers. This broader market definition would likely result in a different assessment of Apple’s market power and the competitive effects of its practices, potentially leading to a less aggressive regulatory response compared to the iOS App Store scenario.
However, the point of a free market is to lowerprices through competition. If regulation doesn't accomplish that all its one is distort the market and decide the winner and losers in terms of profits/revenues.
Why should this be the goal? A low price doesn’t mean it’s a good product, hence the iPhone has such a large market share even tho it’s an expensive product.
I would say competition is more important than prices. The EU’s regulatory framework is designed to
enhance competition, not distort it, ultimately creating a more dynamic and fair marketplace.
If you
Encourage Fair Competition: With The EU’s competition policy, it aims to maintain a level playing field where businesses of all sizes can compete fairly. This involves preventing dominant companies from abusing their market position to eliminate rivals or block new entrants, which would otherwise reduce consumer choice and keep prices high.
And this helps in
Preventing Market Distortions: While a perfectly competitive market would naturally lower prices, the reality is that markets can become distorted by monopolistic practices, cartels, or other forms of anti-competitive behavior. Companies with significant market power might set prices higher than they would in a truly competitive environment, reduce innovation, or engage in practices that harm consumers and smaller competitors. Regulation helps to correct these distortions and ensure that markets remain competitive.
Long-Term Consumer Welfare: While the immediate effect of regulation might seem like intervention, the long-term goal is to protect consumer welfare. Unchecked market power can lead to monopolistic behaviors, where a single company can control prices, reduce output, or diminish service quality. Regulation helps to safeguard against these risks, ensuring that consumers enjoy the benefits of competition over the long term.
Market Efficiency vs. Market Fairness: It’s also important to consider that market efficiency (low prices, innovation) and market fairness (equal opportunity, preventing exploitation) are both essential components of a healthy economy. The EU’s approach to regulation seeks to balance these, ensuring that the market remains efficient and fair, without allowing companies to exploit their position to the detriment of consumers and competitors.
In summary, while free markets are crucial for driving competition, regulation ensures that these markets function properly and remain competitive. Without it, the risk of monopolies and anti-competitive practices could lead to higher prices, less innovation, and reduced consumer welfare.
But how The EU and USA tackles this is largely a philosophical question that is over 100 years old.
And a number of them charge more than Apple - Steam, GoG, cydia get what 30%? Epic apparently charges 12% and I couldn't find good numbers for the others. itch.io appears to be the outlier in that it allows developers to set the percentages; although if you use itch.io for payment their are various fees as well as US withholding requirements.
Well they take more than Apple because they offer more in return than Apple does with the AppStore.
In honesty Apple is the worst of the bunch because they don’t need to improve, but be good enough as no alternatives exist anyway. They can afford to be lazy.
IMHO, the real challenge for developers is not the lack of alternative marketplace or Apple's limitations, but a more fundamental one. They have convinced users that games and other apps should be priced at $5 or less. Alternative marketplaces won't overcome that perception. Unless you can come up with a game that will support an ongoing subscription sale; there's a hard wall in terms of how many people will actually buy your game. For many games that aren't breakout hits across multiple platforms, I suspect the future is more like Apple Arcade where a game is part of a large catalog and the developer gets some payment either to be on it or based on playing time. I suspect apps will wind up being on platforms like Setapp and have to get a small cut in hopes of making it a go. That, to me, is the real game changer, and can lower the cost to the consumer and a tangible positive outcome of the DMA.
Well the benefits is the ability to multi home. They can for example offer their game on the MacAppstore for a higher price than they do on steam and try and steer their customers to use that instead if it’s better.
I use Setapp on my Mac, and pay a fraction of what my cost would be to buy all the apps I use. Sure, there is a lot of not very good apps but enough that I had used before Setapp that switching to Setapp made sense in terms of a much lower cost. They are bringing that to iOS and it will be interesting to see the impact.
Ido think developers need to figure out what to do if changes made to the DMA make it easier for the average user to pirate apps, especially if sideloading makes it possible to just install an IPA, much like in the heyday of jailbreaking. Do they go to free but subscription to unlock features?
I suspect, subscriptions and IAP purchases also have regulatory concerns if they become the prevalent method of making money; and thus get more scrutiny as well, if only "to protect the children."
Actually it’s not likely to grab much attention from the EU as long as it’s not deceptive as this is already fairly regulated. Privacy, online payments and contract laws and regulations are fairly more advanced than American equivalent.
I will also post you this describing the force to deal and essential facilities doctrine. Comparing the EU and USA and its view and recent history
Refusal to Deal and Essential Facilities Doctrine are both important concepts in competition law, but their application differs significantly between the European Union (EU) and the United States (U.S.). Below is a comparison of how these practices are treated in each jurisdiction.
1. Legal Framework
• EU:
• The EU addresses Refusal to Deal primarily under Article 102 of the Treaty on the Functioning of the European Union (TFEU), which prohibits the abuse of a dominant market position.
• The Essential Facilities Doctrine is more readily applied in the EU, where regulators may compel a dominant company to provide access to critical infrastructure or resources if refusing access would harm competition.
• U.S.:
• In the U.S., Refusal to Deal is assessed under Section 2 of the Sherman Antitrust Act, which deals with monopolization and attempts to monopolize.
• The Essential Facilities Doctrine is less favored in the U.S., with courts being more reluctant to compel companies to deal with competitors. U.S. antitrust law generally emphasizes the right of a company to choose with whom it does business.
2. Threshold for Intervention
• EU:
• The EU has a lower threshold for intervention in Refusal to Deal cases. If a dominant firm’s refusal to supply or deal harms competition and cannot be objectively justified, the EU is more likely to intervene.
• The Bronner case (1998) set a high bar for applying the Essential Facilities Doctrine, requiring that the facility be indispensable for competitors, that refusing access would eliminate competition, and that there is no objective justification for the refusal.
• U.S.:
• The U.S. applies a higher threshold for finding a refusal to deal unlawful. The Supreme Court in the Verizon Communications Inc. v. Law Offices of Curtis V. Trinko, LLP (2004) case significantly narrowed the scope for applying the Essential Facilities Doctrine, emphasizing that firms generally have no obligation to assist competitors.
• The U.S. courts often require that the refusal be part of a broader, anti-competitive strategy that harms consumer welfare, making it more difficult to prove than in the EU.
3. Examples of Application
• EU:
• IMS Health (2004): The EU required IMS Health to license a copyrighted data format to competitors, recognizing the format as essential for competition in the pharmaceutical sales data market.
• Microsoft (2007): The EU found Microsoft guilty of abusing its dominance by refusing to provide competitors with interoperability information, which was essential for them to compete in the server software market.
• U.S.:
• Aspen Skiing Co. v. Aspen Highlands Skiing Corp. (1985): One of the few U.S. cases where a refusal to deal was found unlawful, the Supreme Court ruled against Aspen Skiing Co. for refusing to continue a joint lift ticket arrangement, which was seen as anti-competitive.
• Verizon v. Trinko (2004): The U.S. Supreme Court ruled that Verizon’s refusal to provide access to its network did not violate antitrust laws, narrowing the application of the Essential Facilities Doctrine and emphasizing the company’s right to refuse to deal.
4. Approach to Essential Facilities Doctrine
• EU:
• The EU is more proactive in applying the Essential Facilities Doctrine, especially when a dominant company’s control over an infrastructure or resource could harm competition. The EU focuses on maintaining competitive market structures and often steps in to prevent market foreclosure.
• U.S.:
• The U.S. is more reluctant to apply the Essential Facilities Doctrine. U.S. antitrust law tends to prioritize the protection of business incentives and innovation over forced access, reflecting a belief that compelled sharing could reduce the incentive for companies to invest in and develop new facilities.
5. Objective Justification and Efficiency
• EU:
• The EU may allow a refusal to deal if the dominant company can provide a compelling objective justification (e.g., capacity constraints, quality concerns). However, the burden is on the company to prove that the refusal is not aimed at harming competition.
• U.S.:
• In the U.S., if a refusal to deal can be shown to have legitimate business justifications or efficiencies (such as maintaining product quality or ensuring safety), it is more likely to be upheld by the courts, even if it has some negative impact on competition.
6. Impact on Innovation
• EU:
• The EU tends to emphasize the protection of competition over the preservation of business autonomy, which can lead to more interventions that compel firms to share their innovations or infrastructures.
• U.S.:
• U.S. courts and regulators are more concerned about maintaining incentives for innovation. They argue that compelling firms to deal with competitors could discourage investment in new technologies or infrastructure, potentially harming long-term consumer welfare.
Conclusion:
The EU is generally more interventionist in dealing with Refusal to Deal and the Essential Facilities Doctrine, often prioritizing the maintenance of competitive markets and preventing the foreclosure of competitors. In contrast, the U.S. takes a more laissez-faire approach, emphasizing the rights of businesses to control their resources and deal with others as they see fit, unless there is clear evidence of harm to consumer welfare and competition. This difference reflects broader contrasts in how competition law is enforced in the two jurisdictions, with the EU being more focused on market structure and the U.S. on consumer outcomes
