Apple Loses EU Fight Over App Store Gatekeeper Label

[Samplasion]

The gatekeeper shall allow providers of services and providers of hardware, free of charge, effective interoperability with, and access for the purposes of interoperability to, the same hardware and software features accessed or controlled via the operating system or virtual assistant listed in the designation decision pursuant to Article 3(9) as are available to services or hardware provided by the gatekeeper.

“Hardware and software features controlled by iOS” are Apple’s intellectual property.

For example, Apple introduced a feature that lets AirPods translate languages. Apple had to delay the release of that feature in Europe until they made it available for competing headphone manufacturers to use.

This is bad because 1) it discourages Apple from innovating by significantly changing the ROI calculation (why spend a bunch of money on a feature that differentiates your products if your competitors then get the feature without having to spend a bunch of money - you’re effectively subsidizing your competitors) and 2) discourages other companies from innovating (why spend millions of dollars to develop competing, potentially better translation features when you can just use Apple’s for free) 3) Is taking Apple’s IP from them without compensation for no legitimate reason (there is nothing preventing Bose from developing a translation feature in their headphones).

Hope that helps!

Yes, the DMA imposes equal opportunity to "access" to the relevant APIs, not the source code of the APIs themselves.

Saying that access to APIs is Apple's own IP is like saying 20% of my bedroom belongs to IKEA because I bought the door from them. It obviously makes no sense.

Or, to use your example, is like saying Apple should have a lawful monopoly over the concept of translation through earphones. Because the translation layer runs on the iPhone and not the AirPods, there is no reason not to allow it on all devices. It's not like Sony can somehow get the translation model off of an iPhone and onto some other device just because Apple made a couple of method calls public instead of private.

Besides, I thought Apple users liked consistency? What's more consistent than using your phone the same way regardless of accessories? Or is it only good when the accessory has a bitten apple engraved on it? In which case, one wonders if the pushback is entirely due to the alleged fall of the walled garden, or because of a perceived decline in social status of using Apple devices...

Finally, you've completely failed to address the part where I ask what exactly Apple's IP is supposed to be. Vague characterizations such as "Apple's hardware and software development" won't do (are all apps on the App Store part of Apple's IP? they are a "development" that runs on "Apple hardware" after all)

 

[surferfb]

Yes, the DMA imposes equal opportunity to "access" to the relevant APIs, not the source code of the APIs themselves.
Saying that access to APIs is Apple's own IP is like saying 20% of my bedroom belongs to IKEA because I bought the door from them. It obviously makes no sense.

If the government forces you to give “access” to your spare bedroom for free to anyone who asks I’d argue that’s taking your property even if you still technically own it.

Or, to use your example, is like saying Apple should have a lawful monopoly over the concept of translation through earphones. Because the translation layer runs on the iPhone and not the AirPods, there is no reason not to allow it on all devices. It's not like Sony can somehow get the translation model off of an iPhone and onto some other device just because Apple made a couple of method calls public instead of private.

It’s Apple’s property, they should get to decide. If they want to use that feature to differentiate their headphones that should be Apple’s decision to make.

Besides, I thought Apple users liked consistency? What's more consistent than using your phone the same way regardless of accessories? Or is it only good when the accessory has a bitten apple engraved on it? In which case, one wonders if the pushback is entirely due to the alleged fall of the walled garden, or because of a perceived decline in social status of using Apple devices...

It’s bad because it discourages innovation and it’s an affront to the free market. But, it’s been a few years since I heard the “Apple users are status-obsessed sheep” argument, so thanks for the chuckle.

Finally, you've completely failed to address the part where I ask what exactly Apple's IP is supposed to be. Vague characterizations such as "Apple's hardware and software development" won't do (are all apps on the App Store part of Apple's IP? they are a "development" that runs on "Apple hardware" after all)

I said that above. “hardware and software features” (not development.) iOS and its associated APIs are Apple’s IP.

All apps on the App Store are not Apple’s IP, but all apps on the App Store use Apple’s IP under license. (Which is why Apple should be allowed to charge developers for that use.)

 

[lusty]

You can't have a monopoly on your own product. iOS is an operating system that runs on smart phones. You have multiple smart phones and you have two operating and in the EU Apple has less than 30% of this smart phone market.

Third-party App Store have been a complete flop as predicted. People want simplicity, not complexity.

I think you’ll find that under EU law you can. Just because you don’t understand the law, doesn’t mean it hasn’t been broken.

 

[lusty]

And McDonalds has 100% of hamburger distribution in their restaurants. That doesn’t mean they have a monopoly.

Utterly different. Apple has a food court and expects McDonalds to pay them for burgers sold in a McDonalds restaurant in addition to their rent. It’s a racket and needs stopping. Your lack of understanding here is staggering.

Under the DMA, Apple is being required to give access to its innovations and its intellectual property to its competitors for free.

Yes, as a PLATFORM they are being required to set a level playing field. It’s the law and it’s pretty clear and fair and is working on behalf of both consumers and developers.

iOS is Apple’s intellectual property. Apple is well within its rights to decide how that property is used and what they charge for that use.

No, they aren’t. They have to follow the law. None of their intellectual property is being given away, they’re just not allowed to stop others from selling theirs in a fair way on that platform.

Perhaps you’d prefer we stop others from “infringing” on Apple and kill the platform?

 

[lusty]

Sure it’s their store. Don’t know where internet posters get the mistaken thought companies can’t have proprietary products.

It’s the law, that’s where. It may be different from the US but in the free world we have laws to protect consumers and economies.

Their intellectual property.

Be specific. I can’t see any IP Apple are giving away at all. They create a device and OS which people pay them for. Hose people then run apps from other developers. Nothing taken.

No they do t.

Yes, they do

Yes. And because you may not like the rules didn’t make them illegal.

Their rules are illegal and unfair and stifle competition.

It’s apples right.

No, it’s illegal, that’s the point. Apple provide a platform but it’s not their right to police it, that’s the job of government.

Perfectly legal. It’s completely opt-in.

No, it’s abuse of power. That’s literally the point of them being stopped. Have you misunderstood everything about this story?

In your opinion.

In the opinion of the EU

None of that matters. Don’t like apples products, there is competition.

Like a turkey voting for Christmas.

 

[Samplasion]

If the government forces you to give “access” to your spare bedroom for free to anyone who asks I’d argue that’s taking your property even if you still technically own it.

If the government wants to force me to give access to my bedroom, it's because my "bedroom" is actually used by millions of people everyday, in such a way that being controlled solely by me is a net negative for society. Seeing as the EU doesn't target random people, it's a moot example but I appreciate the effort.

It’s Apple’s property

the concept of translating through headphones?

they should get to decide

Not when they have a market position like they do, and even then, not under EU law.

But, it’s been a few years since I heard the “Apple users are status-obsessed sheep” argument, so thanks for the chuckle.

I'm just tryna rationalize all the arguments I'm hearing.

All apps on the App Store are not Apple’s IP, but all apps on the App Store use Apple’s IP under license. (Which is why Apple should be allowed to charge developers for that use.)

So Apple charges users for a license, then they charge developers for the same license. Sounds about right for Apple. But if they want to charge double for the same access key, they should allow other stores on users' phones. Otherwise it's just leeching.

 

[lusty]

iOS and its associated APIs are Apple’s IP.

All apps on the App Store are not Apple’s IP, but all apps on the App Store use Apple’s IP under license

APIs are there so people can make software. Without software Apple can’t sell the platform. Microsoft never charged for APIs, and they had and have considerably more complete an API than Apple.

I'm just tryna rationalize all the arguments I'm hearing.

It’s baffling how people are arguing Apple’s case for them, against their own interests. Fanboy is the only explanation aside from employee

 

[surferfb]

Utterly different. Apple has a food court and expects McDonalds to pay them for burgers sold in a McDonalds restaurant in addition to their rent. It’s a racket and needs stopping. Your lack of understanding here is staggering.

Fun fact: most malls charge stores in them a percentage of revenue as a part of their rent. Now what were you saying about lack of understanding?

Yes, as a PLATFORM they are being required to set a level playing field. It’s the law and it’s pretty clear and fair and is working on behalf of both consumers and developers.

It’s not doing anything other than keeping features away from EU users and harming innovation, but yes, it is the law.

No, they aren’t. They have to follow the law. None of their intellectual property is being given away, they’re just not allowed to stop others from selling theirs in a fair way on that platform.

Access to their IP is being given away. Which is the same thing.

Perhaps you’d prefer we stop others from “infringing” on Apple and kill the platform?

I want Apple to be able to set the rules around the use of their IP. If Apple’s rules are too stringent then developers will leave. That’s how the free market works. Instead, we have a bunch of unelected bureaucrats who think forcing cookie pop ups are a good idea saying that Apple has to make its platform less safe and secure because you can’t be bothered to use Android.

APIs are there so people can make software. Without software Apple can’t sell the platform. Microsoft never charged for APIs, and they had and have considerably more complete an API than Apple.

So? It’s still Apple’s IP and they should get to decide how it’s used.

It’s baffling how people are arguing Apple’s case for them, against their own interests. Fanboy is the only explanation aside from employee

It’s not against my own interests. I firmly believe Apple’s model is far superior to me and the vast, vast majority of iOS users and the EU is the one arguing against its own citizens’ interests.

Not a fanboy or employee either.

 

[I7guy]

[…{

I'm just tryna rationalize all the arguments I'm hearing.

[…]

lol totally disingenuous response. So ad-homs against some fictional group of apple “status seekers” instead of intellectual honesty regarding the regs themselves.

 

[surferfb]

If the government wants to force me to give access to my bedroom, it's because my "bedroom" is actually used by millions of people everyday, in such a way that being controlled solely by me is a net negative for society. Seeing as the EU doesn't target random people, it's a moot example but I appreciate the effort.

It’s the same concept. And while the EU may not target random people, they do target random companies. The DMA doesn’t apply to Samsung or Spotify, which meet the quantitative thresholds written into the law, for example, but it does apply to iPadOS, which doesn’t. Sure the EU has “reasons” for the difference. But the reasons weren’t for any legitimate reason - they were developed just to hit American companies.

the concept of translating through headphones?

No, the code that Apple wrote to enable the feature. Bose should be free to write their own code to make their headphones more attractive. They shouldn’t get access to Apple’s code for free against Apple’s desires. That’s wrong and harms innovation.

Not when they have a market position like they do, and even then, not under EU law.

30% of the market doesn’t justify extreme measures. “Dominant market position” is normally 40% but the DMA eschews that - it could apply to a compamy with 10% market share. And yes, they don’t get to decide in the EU, but they should. The EU is wrong here and it harms the EU and its citizens.

I'm just tryna rationalize all the arguments I'm hearing.

Well, it has nothing to do with “status”. It’s about interference in the free market and harming Apple’s users.

So Apple charges users for a license, then they charge developers for the same license. Sounds about right for Apple. But if they want to charge double for the same access key, they should allow other stores on users' phones. Otherwise it's just leeching.

It’s two entirely different markets.

Users and developers aren’t buying the same good. The user buys a device and the right to use iOS. The developer buys access to a distribution channel, payment and commerce rails, notarization and fraud/security infrastructure, SDKs and APIs, and, above all, access to a large base of authenticated users with cards on file and high willingness to pay.

Letting developers freeload and not pay Apple is wrong and the fact that the EU jumped to this does a really good job of explaining why tech innovation doesn’t exist on the continent.

 

[lusty]

Fun fact: most malls charge stores in them a percentage of revenue as a part of their rent. Now what were you saying about lack of understanding?

Not in the free world they don’t. Perhaps in the US’ broken system.

It’s not doing anything other than keeping features away from EU users and harming innovation, but yes, it is the law.

This has nothing to do with feature availability aside from Apple punishing users for wanting choice. That makes them even more evil than they already looked, not less.

Access to their IP is being given away. Which is the same thing.

You clearly don’t understand IP. No Apple IP is being given away whatsoever. Hey charge for the hardware, they charge for the OS, they charge for the development kit. They’re charging for everything multiple times over despite the developers and apps being the sole reason for their success. Jobs knew this, and originally made the iPhone completely open and Javascript based.

I want Apple to be able to set the rules around the use of their IP. If Apple’s rules are too stringent then developers will leave. That’s how the free market works. Instead, we have a bunch of unelected bureaucrats who think forcing cookie pop ups are a good idea saying that Apple has to make its platform less safe and secure because you can’t be bothered to use Android.

I can’t think of anything worse than private companies setting the rules. Completely against democracy. I want elected governments to set rules, which is thankfully what’s happening.
Cookies were widely abused, that was a good law and has helped privacy enormously. Malicious compliance is the issue, with companies making you hate their cookie popup. That’s on them, not the government.

So? It’s still Apple’s IP and they should get to decide how it’s used.

No, they shouldn’t. Apple are not my government.

It’s not against my own interests. I firmly believe Apple’s model is far superior to me and the vast, vast majority of iOS users and the EU is the one arguing against its own citizens’ interests.

Not a fanboy or employee either.

You have a very basic understanding of the topic and what your own interests even are. There is literally nothing in it for you if Apple have full control, yet there are many well documented downsides. Apple have been stifling innovation for years now just like Microsoft used to, and it needs to be stopped.

 

[surferfb]

You have a very basic understanding of the topic and what your own interests even are. There is literally nothing in it for you if Apple have full control, yet there are many well documented downsides. Apple have been stifling innovation for years now just like Microsoft used to, and it needs to be stopped.

I’ve been debating this topic for years - just because someone disagrees with your opinion doesn’t mean they have a “basic understanding”. Particularly when in the same post you argue that Jobs “originally made to iPhone completely open and based it on JavaScript”! I mean, what?!?

And who are you to tell me what my own interests are?

There is a lot in it for me if Apple has full control. Most importantly, safety and security. I’ll ask you the same question ii ask everyone who debates me on this:

What is your explanation for Android’s malware problem and why iOS doesn’t have one? Is Apple better at security than Google? Apple’s users are more sophisticated? Scammers don’t want to target Apple customers? Or is it because Apple’s model protects end users in a way Google’s open model cannot.

I can hand an iPhone or an iPad to my five year old kid or my 70 year old dad and not worry they’re going to somehow install a virus or spyware. And millions of people have chosen Apple’s model precisely because of their restrictions, not in spite of them. That shouldn’t be taken away from consumers when the competitor with 70% market share is open for consumers who care. And definitely not by unelected bureaucrats who have shown over and over and over and over again they don’t understand technology, security, and good user experience.

 

[surferfb]

Not in the free world they don’t. Perhaps in the US’ broken system.

Oh, and by the way, yes - they do in the EU too

Turnover rent in commercial leasing

Turnover rent is becoming a key tool for optimising the profitability of shopping centre owners while protecting tenants from excessive cost burdens.

koda-advisory.pl

Our advisors have extensive experience analyzing and optimizing turnover rent settlements in some of Poland’s largest shopping centers. We would be pleased to assist your organization as well.

And the UK
https://www.savills.co.uk/research_articles/229130/304695-0

And Switzerland too:

Definition and examples of turnover rent

Find out how the flexible rental model with a base rent and variable portion works, what advantages it offers and what legal aspects need to be considered.

www.maison.work

 

[Madhatter32]

Apple has a food court and expects McDonalds to pay them for burgers sold in a McDonalds restaurant in addition to their rent. It’s a racket and needs stopping. Your lack of understanding here is staggering.

I am following this thread for entertainment purposes -- mostly because most people really do not understand how the business world works "in the free world," as you put it, and their assumptions are funny.

But, just letting you know, this analogy of yours is entirely broken. Did you know that major retailers (think Walmart, Target, Macy's or the old Sears etc.) always charge vendors access fees. Things like rack or shelf space, new store allowances, chargeback allowances, advertising, shipping, returns etc. Commercial landlords, per your example, can and do structure lease agreements that share in the profits of their tenants. These are just plain facts -- just so you know.

The fact that a governmental body wants to undermine the ability of business of manage its own business (and inject itself in the business relationship between two independent companies) is quite disturbing. It's not a "free market" approach at all. Quite the opposite.

 

[lusty]

Particularly when in the same post you argue that Jobs “originally made to iPhone completely open and based it on JavaScript”! I mean, what?!?

Original iPhone didn’t have an app store, Jobs wanted everything to be a web app.

 

[lusty]

But, just letting you know, this analogy of yours is entirely broken. Did you know that major retailers (think Walmart, Target, Macy's or the old Sears etc.) always charge vendors access fees.

Oh, you’re in the US then. Completely different (and broken) model. We’re discussing Europe which has very different culture and values and not everything is about making more money.

The fact that a governmental body wants to undermine the ability of business of manage its own business (and inject itself in the business relationship between two independent companies) is quite disturbing. It's not a "free market" approach at all. Quite the opposite.

Why? Apple have consistently been acting in bad faith and stifled innovation on the platform in order to avoid competition and take everything for themselves. There are many well documented examples where they straight up stole app ideas and kicked the originals out of the App Store. That’s not a good thing for the consumer no matter how you try to frame it.

 

[dblissmn]

I am following this thread for entertainment purposes -- mostly because most people really do not understand how the business world works "in the free world," as you put it, and their assumptions are funny.

But, just letting you know, this analogy of yours is entirely broken. Did you know that major retailers (think Walmart, Target, Macy's or the old Sears etc.) always charge vendors access fees. Things like rack or shelf space, new store allowances, chargeback allowances, advertising, shipping, returns etc. Commercial landlords, per your example, can and do structure lease agreements that share in the profits of their tenants. These are just plain facts -- just so you know.

The fact that a governmental body wants to undermine the ability of business of manage its own business (and inject itself in the business relationship between two independent companies) is quite disturbing. It's not a "free market" approach at all. Quite the opposite.

Abuse of vendors is hardly good for a free market. Walmart bankrupted Rubbermaid with this approach and drove production out of the United States. More generally the US has seen one mid-market grocery wholesaler after another go out of business due to monopolism by the big boys with the result that we have agreements imposed by the likes of Walmart that guarantee Walmart the "lowest" price and have maintained a high price floor in Walmart and other big box retail and caused prices at independents to soar beyond that.

The whole point of EU competition policy -- programmed as it largely was by Thatcherism in the 1980s -- is to ensure free markets and ease of access for new entrants. If anything I think they should lean harder on this; there are times they've been overly permissive on copyright and patent abuse, such as the monopoly EU and British regulators have allowed Electrolux to gain in Europe on heat-pump washer-dryers (an assertion of patent by Electrolux which US and Chinese regulators, by the way, did not fall for). But the app store phenomenon is part of a pattern where the EU and UK have been very forward about ensuring retail competition.

 

[I7guy]

Abuse of vendors is hardly good for a free market. Walmart bankrupted Rubbermaid with this approach and drove production out of the United States. More generally the US has seen one mid-market grocery wholesaler after another go out of business due to monopolism by the big boys with the result that we have agreements imposed by the likes of Walmart that guarantee Walmart the "lowest" price and have maintained a high price floor in Walmart and other big box retail and caused prices at independents to soar beyond that.

The whole point of EU competition policy -- programmed as it largely was by Thatcherism in the 1980s -- is to ensure free markets and ease of access for new entrants. If anything I think they should lean harder on this; there are times they've been overly permissive on copyright and patent abuse, such as the monopoly EU and British regulators have allowed Electrolux to gain in Europe on heat-pump washer-dryers (an assertion of patent by Electrolux which US and Chinese regulators, by the way, did not fall for). But the app store phenomenon is part of a pattern where the EU and UK have been very forward about ensuring retail competition.

Fostering competition by forcing manufacturers to give away their r&d for free is anything but. It’s a way to stifle innovation. True competition would look like another smartphone platform.

As to the references to Walmart the equivalent DMA ruling would force Walmart to provide rent free space to competitors. Something that would never happen imo.

As to abuse of vendors with reference to Apple that has never been found to be the case in the judicial system. (Correct me if I’m wrong, but two wrongs do t make this legislation justified.)

 

[Madhatter32]

Abuse of vendors is hardly good for a free market. Walmart bankrupted Rubbermaid with this approach and drove production out of the United States. More generally the US has seen one mid-market grocery wholesaler after another go out of business due to monopolism by the big boys with the result that we have agreements imposed by the likes of Walmart that guarantee Walmart the "lowest" price and have maintained a high price floor in Walmart and other big box retail and caused prices at independents to soar beyond that.

The whole point of EU competition policy -- programmed as it largely was by Thatcherism in the 1980s -- is to ensure free markets and ease of access for new entrants. If anything I think they should lean harder on this; there are times they've been overly permissive on copyright and patent abuse, such as the monopoly EU and British regulators have allowed Electrolux to gain in Europe on heat-pump washer-dryers (an assertion of patent by Electrolux which US and Chinese regulators, by the way, did not fall for). But the app store phenomenon is part of a pattern where the EU and UK have been very forward about ensuring retail competition.

I would respectfully reframe your "abuse of vendors" claim as really a "freedom to contract" issue. No vendor is forced to sell to Walmart (and many purposefully do not). Quite the contrary, Walmart is very upfront with vendors about costs.

I am a big proponent of free markets and competition and Thatcher as well. But your reference to competition giving way to consolidation, which is undoubtedly true on some level, is not a necessarily an evil and, in fact, has not generally given way to monopolistic practices in the United States ... whether it's in retail or software (e.g.Microsoft) or groceries.

Why? Because market consolidation under a certain level is not monopolistic or unfair. Just look at the evidence. Here, prices have been kept low and stable for decades (before the recent Biden government spending binge) and none of these so-called monopolies have, in fact, been durable over time. Sears gave way to Walmart which gave way to Amazon.

Free markets need to function and government regulation that prohibits competitive advantage risks working against low prices, advancement and innovation. This is the problem with the EU generally and, in part, explains its lack luster performance and productivity against other regions in America and Asia.

 

[garranhado]

At this point does it matter, DMA been a failure, nothing has really changed other than EU doesn't get some new features that Apple has come out with. Third-party app stores have gotten zero traction and barely rise the level of hobby.

Yes, all EC decisions in last years makes more damage for europeans than benefits.

 

[spazzcat]

I think you’ll find that under EU law you can. Just because you don’t understand the law, doesn’t mean it hasn’t been broken.

I get the EU can make anything a law, however, that doesn't mean it meets the definition of a monopoly.

 

[spazzcat]

Yes, the DMA imposes equal opportunity to "access" to the relevant APIs, not the source code of the APIs themselves.

Saying that access to APIs is Apple's own IP is like saying 20% of my bedroom belongs to IKEA because I bought the door from them. It obviously makes no sense.

Or, to use your example, is like saying Apple should have a lawful monopoly over the concept of translation through earphones. Because the translation layer runs on the iPhone and not the AirPods, there is no reason not to allow it on all devices. It's not like Sony can somehow get the translation model off of an iPhone and onto some other device just because Apple made a couple of method calls public instead of private.

Besides, I thought Apple users liked consistency? What's more consistent than using your phone the same way regardless of accessories? Or is it only good when the accessory has a bitten apple engraved on it? In which case, one wonders if the pushback is entirely due to the alleged fall of the walled garden, or because of a perceived decline in social status of using Apple devices...

Finally, you've completely failed to address the part where I ask what exactly Apple's IP is supposed to be. Vague characterizations such as "Apple's hardware and software development" won't do (are all apps on the App Store part of Apple's IP? they are a "development" that runs on "Apple hardware" after all)

If you take companies rights to have proprietary software or have to share the proprietary APIs you kill innovation. Why would a company waste time developing stuff if they just have to let everybody have access to it for free.

 

[spazzcat]

Oh, you’re in the US then. Completely different (and broken) model. We’re discussing Europe which has very different culture and values and not everything is about making more money.

So the US model is broken why does the EU need to stifle innovation from US companies? Why don't EU companies do their own innovation and stop relying on iOS and android?

 

[lusty]

So the US model is broken why does the EU need to stifle innovation from US companies? Why don't EU companies do their own innovation and stop relying on iOS and android?

They do, but then the wealthiest companies in the world buy them and shut down the innovation. Happens all the time to EU companies and technologies. The computer itself was a European invention as were most of the early innovations in computing. Certainly everything before 1950. The world wide web was British, Arm chips too.