Apple Ordered to Change App Store in Europe Again

[surferfb]

The value Apple provides in this regard can be related to other factors such as the first payment you do in the store, developer fees or something else. But considering in this case regarding steering and allowing alternatives payment options and offer to be made it’s limited to the initial customer acquisition.

Why isn’t Apple allowed to charge a fee to those who don’t use its preferred payment system for ongoing support and maintenance of the platform? They’re not allowed to charge rent? In what world does that make sense? Apple’s the one company on the planet that can’t charge for use of its property?

It’s wrong only because of it’s anticompetitive impacts and market abuse you can quantify and measure, and by history these things are shown to lead to specific market harms, therefore you need to prove the behavior your engaging in isn’t harmful. If none of that happens then it’s not wrong. Hence why smaller enterprises can do the thing. No more different than your monopoly laws that doesn’t impact small businesses 🤷‍♂️

In other words, “it’s ok when European companies do it”.

The rules have largely been consistent regarding what’s considered antitrust.

Companies and other entities accused that Apple committed antitrust violations and was therefore investigated in those accusations.
DMA is just Exanti ( before something happens) regulation instead of Expost( after the damage is done)

No, what happened was EU decided the American companies must be doing something wrong so worked backwards to justify banning their practices. Literally that’s what happened!

The justifications for the law was intentionally vague and retroactively applied to practices that have long been accepted in the market. And then on top of that, the EU skipped detailed economic studies that are normally done - no consumer harm calculations, no cost benefit analysis, etc.

As Pinar Akman stated:

The DMA assumes rather than demonstrates that the conduct it prohibits causes harm. This is antithetical to the core principles of antitrust and the rule of law.

Using ex-ante regulation presumes harm. Why would you presume something is harmful when it’s been in place for over a decade and sprouted a thriving industry? Because you know using traditional competition law would require case by case analysis proving harm that you wouldn’t be able to (because it’s not actually harmful).

That’s up to the company to determine. Saying value or just gesturing to some abstract notion isn’t evidence of a monetary value. It must be quantifiable. The fact someone is willing to pay something doesn’t equal it’s value

The EU demands data driven justification: "Show us which specific service this fee pays for, at what cost."

This is absurd policy. Private companies can’t charge what they want? They have to “prove” their value is worth it?

Let’s get an investigation as to why European watchmakers charge tens and hundreds of thousands of dollars for watches. How can you quantify the value? I think it’s anticompetitive. I deserve a Patek or A. Lange and Söhne timepiece.

Here’s a justification: You keep saying developers have to use Apple’s property or they’ll go out of business. I say that’s worth 15-30% of their revenue. Why do you disagree?

 

[Sophisticatednut]

Why isn’t Apple allowed to charge a fee to those who don’t use its preferred payment system for ongoing support and maintenance of the platform? They’re not allowed to charge rent? In what world does that make sense? Apple’s the one company on the planet that can’t charge for use of its property?

They can charge a fee. But it can’t be for the act of anti steering. Perhaps every app with alternative payment options must pay 0.5€ at time of purchase or explore Increased developers fee etc.

In other words, “it’s ok when European companies do it”.

Exact same laws apply. They just tend to be caught by local governments instead of EU.

No, what happened was EU decided the American companies must be doing something wrong so worked backwards to justify banning their practices. Literally that’s what happened!

The justifications for the law was intentionally vague and retroactively applied to practices that have long been accepted in the market. And then on top of that, the EU skipped detailed economic studies that are normally done - no consumer harm calculations, no cost benefit analysis, etc.

Neither have been longly accepted. And not vague in any shape. The US and EU don’t share any semblance regarding theory of harm. EU isn’t under the Chicago school of economics. Consumer welfare supremacy and efficiency uber allés isn’t supported by EU case law. Be free to read article 101 and 102 TFEU

EUR-Lex - 12008E101 - EN

EUR-Lex - 12008E102 - EN

As Pinar Akman stated:


Using ex-ante regulation presumes harm. Why would you presume something is harmful when it’s been in place for over a decade and sprouted a thriving industry? Because you know using traditional competition law would require case by case analysis proving harm that you wouldn’t be able to (because it’s not actually harmful).

EU have always had a structural object assumed harmful as defecto. Such as price fixing or margin squeezing as defacto harmful without evidence.

This is absurd policy. Private companies can’t charge what they want? They have to “prove” their value is worth it?

They never have been allowed to.

Let’s get an investigation as to why European watchmakers charge tens and hundreds of thousands of dollars for watches. How can you quantify the value? I think it’s anticompetitive. I deserve a Patek or A. Lange and Söhne timepiece.

Here’s a justification: You keep saying developers have to use Apple’s property or they’ll go out of business. I say that’s worth 15-30% of their revenue. Why do you disagree?

Fine, Let's Value That 50,000 Patek Philippe Using Apple's Logic!

Following Apple's Revenue-Based Pricing Model:

Since you'll check this watch maybe 100 times per day for the next 20 years (that's 730,000 glances), and each glance saves you 3 seconds of pulling out your phone, you're saving 2,190,000 seconds of your life.

At 50€/hour salary, that's 30,417€ in time value, so the 20,000 watch is clearly underpriced!

Since you check your watch 100 times daily, that's 0.50€ per glance

• Annual fee: 18,250€just for looking at time
• But wait! You also use it to coordinate meetings, so add another 0.50€ per business interaction
• Total annual "Core Technology Fee": 50,000+€

But that's just for accessing our proprietary time-display technology!

The "Anti-Steering" Luxury Model

Patek's New Rules:

• Watch dealers cannot mention that Casio exists
• Sales staff must say: "This is the only way to tell time
• Watch face cannot display "Time also available elsewhere”

We're protecting customer time sources!…

Revenue-Based Luxury Pricing

Since the watch enables your productivity:

• Lawyers: 30% of billable hours (watch keeps you punctual!)
• CEOs: 30% of company profits (boardroom time management!)
• Students: 30% of future earnings (helped you get to class on time!)
• Our timepiece contributed to your success we deserve ongoing compensation!

But wait! Lets use Apple's ongoing revenue model:
Since you earn money while wearing this watch
And the watch enables your productivity by keeping you punctual
Patek Philippe deserves 15% of your annual salary forever…
A 100,000€ salary means 30,000€/year to Patek Philippe in perpetuity
Patek's Justification:

Our timepieces contain proprietary Swiss complications developed over centuries. Every time you benefit from mechanical timekeeping technology, you owe us €0.50 per glance.

Applied Globally:

• Check your iPhone clock? That's Patek technology - €0.50 please
• Use a microwave timer? Swiss precision heritage - €0.50
• Catch a train on schedule? You learned punctuality from our culture - €0.50

Annual Bill: 50,000 time-checks × €0.50 =
25,000€/year forever

The Patek Philippe "Anti-Steering" Rules:
Banned Phrases in Watch Stores:

• ❌"Casio has the same time for $20"
• ❌"Check your phone instead"
• ❌"Visit our website for 50% off"

Mandatory Disclaimers:

• ✅"Alternative timepieces may compromise your punctuality and social status"
• ✅"Leaving our store creates security risks to your schedule”

The Patek Philippe "Link Tax":
Scenario: You read a travel article mentioning
"Swiss precision"
Patek's Claim: "You discovered time consciousness through our cultural heritage"

Your Bill: 27% of all future earnings from punctuality-dependent work

Duration: Forever (with 7-year minimum)
But that's insane! you say?

Exactly! Now You Understand iOS Pricing!

The Patek Philippe "Apple Store" Model:

• Want to buy any watch in Switzerland? Pay Patek 15% of your salary
• Want to tell time without a Patek? Blocked by law as they have a person perpetually blocking you unless paid.

Found a cheaper Casio online? "Security risk purchase blocked"
Moving to France? Still owe Patek 27% forever because you "discovered timekeeping" in their store

But Patek makes beautiful, hand-crafted mechanical marvels!

And Apple makes... what exactly that justifies taxing practically every transaction on a device you already own?

The Real Value Quantification:

Patek Philippe's Value:
Voluntary luxury in a competitive market

• You can choose alternatives or go without
• Price reflects transparent craftsmanship and brand value

Apple's App Store Value:
Mandatory tax on a captive market
No alternatives allowed by law
Price reflects bottleneck control, not service value.

The Difference: If Patek controlled the only legal way to tell time and charged 30% of everyone's income, we'd call that extortion, not luxury pricing! Heck if any watch did that we would call it criminal.

In my satirical world, Patek would go bankrupt immediately because:
1. Customers would flee to competitive markets
2. Swiss courts would laugh this out of court.
3. No legal system would enforce perpetual salary garnishment for checking time

But Apple's model thrives because:
1. Legal mobile platform lock-in traps users
2. Network effects make switching costly
3. Regulatory capture prevents meaningful competition

Thanks for helping illustrate why competitive luxury markets work beautifully, while platform monopolies need regulatory intervention!

 

[PlayUltimate]

They can charge a fee. But it can’t be for the act of anti steering. Perhaps every app with alternative payment options must pay 0.5€ at time of purchase or explore Increased developers fee etc.

Exact same laws apply. They just tend to be caught by local governments instead of EU.

Neither have been longly accepted. And not vague in any shape. The US and EU don’t share any semblance regarding theory of harm. EU isn’t under the Chicago school of economics. Consumer welfare supremacy and efficiency uber allés isn’t supported by EU case law. Be free to read article 101 and 102 TFEU

EUR-Lex - 12008E101 - EN

EUR-Lex - 12008E102 - EN

EU have always had a structural object assumed harmful as defecto. Such as price fixing or margin squeezing as defacto harmful without evidence.

They never have been allowed to.

Fine, Let's Value That 50,000 Patek Philippe Using Apple's Logic!

Following Apple's Revenue-Based Pricing Model:

Since you'll check this watch maybe 100 times per day for the next 20 years (that's 730,000 glances), and each glance saves you 3 seconds of pulling out your phone, you're saving 2,190,000 seconds of your life.

At 50€/hour salary, that's 30,417€ in time value, so the 20,000 watch is clearly underpriced!

Since you check your watch 100 times daily, that's 0.50€ per glance

• Annual fee: 18,250€just for looking at time
• But wait! You also use it to coordinate meetings, so add another 0.50€ per business interaction
• Total annual "Core Technology Fee": 50,000+€

But that's just for accessing our proprietary time-display technology!

The "Anti-Steering" Luxury Model

Patek's New Rules:

• Watch dealers cannot mention that Casio exists
• Sales staff must say: "This is the only way to tell time
• Watch face cannot display "Time also available elsewhere”

We're protecting customer time sources!…

Revenue-Based Luxury Pricing

Since the watch enables your productivity:

• Lawyers: 30% of billable hours (watch keeps you punctual!)
• CEOs: 30% of company profits (boardroom time management!)
• Students: 30% of future earnings (helped you get to class on time!)
• Our timepiece contributed to your success we deserve ongoing compensation!

But wait! Lets use Apple's ongoing revenue model:
Since you earn money while wearing this watch
And the watch enables your productivity by keeping you punctual
Patek Philippe deserves 15% of your annual salary forever…
A 100,000€ salary means 30,000€/year to Patek Philippe in perpetuity
Patek's Justification:

Our timepieces contain proprietary Swiss complications developed over centuries. Every time you benefit from mechanical timekeeping technology, you owe us €0.50 per glance.

Applied Globally:

• Check your iPhone clock? That's Patek technology - €0.50 please
• Use a microwave timer? Swiss precision heritage - €0.50
• Catch a train on schedule? You learned punctuality from our culture - €0.50

Annual Bill: 50,000 time-checks × €0.50 =
25,000€/year forever

The Patek Philippe "Anti-Steering" Rules:
Banned Phrases in Watch Stores:

• ❌"Casio has the same time for $20"
• ❌"Check your phone instead"
• ❌"Visit our website for 50% off"

Mandatory Disclaimers:

• ✅"Alternative timepieces may compromise your punctuality and social status"
• ✅"Leaving our store creates security risks to your schedule”

The Patek Philippe "Link Tax":
Scenario: You read a travel article mentioning
"Swiss precision"
Patek's Claim: "You discovered time consciousness through our cultural heritage"

Your Bill: 27% of all future earnings from punctuality-dependent work

Duration: Forever (with 7-year minimum)
But that's insane! you say?

Exactly! Now You Understand iOS Pricing!

The Patek Philippe "Apple Store" Model:

• Want to buy any watch in Switzerland? Pay Patek 15% of your salary
• Want to tell time without a Patek? Blocked by law as they have a person perpetually blocking you unless paid.

Found a cheaper Casio online? "Security risk purchase blocked"
Moving to France? Still owe Patek 27% forever because you "discovered timekeeping" in their store

But Patek makes beautiful, hand-crafted mechanical marvels!

And Apple makes... what exactly that justifies taxing practically every transaction on a device you already own?

The Real Value Quantification:

Patek Philippe's Value:
Voluntary luxury in a competitive market

• You can choose alternatives or go without
• Price reflects transparent craftsmanship and brand value

Apple's App Store Value:
Mandatory tax on a captive market
No alternatives allowed by law
Price reflects bottleneck control, not service value.

The Difference: If Patek controlled the only legal way to tell time and charged 30% of everyone's income, we'd call that extortion, not luxury pricing! Heck if any watch did that we would call it criminal.

In my satirical world, Patek would go bankrupt immediately because:
1. Customers would flee to competitive markets
2. Swiss courts would laugh this out of court.
3. No legal system would enforce perpetual salary garnishment for checking time

But Apple's model thrives because:
1. Legal mobile platform lock-in traps users
2. Network effects make switching costly
3. Regulatory capture prevents meaningful competition

Thanks for helping illustrate why competitive luxury markets work beautifully, while platform monopolies need regulatory intervention!

Flawed analogy: I buy an iPhone and put it in my pocket and I have zero on-going payments to Apple. And iPhone customers, based on customer satisfaction surveys, are happy.

So, let’s go back to the consignment model that Apple create in the iOS store. And apply it to your example.
I want to create a new watch band taking advantage of the branding the Patek Philippe created. Under a traditional model, I bring it to the store. The retailer buys it and then sells it with a markup. No complaints. A consignment model would look slightly different. I bring it to the store. I tell the owner that I want to sell it for $XX. The owner says, ‘OK, but I get a % of that sale price’ Again no problem.

All of the issues that Apple is no having is because developer’s decided that they no longer wanted to sell software as a product but sell it as a service. The problem is the consignment pricing model is now broken because the actual price of the product cannot be determined.

That is like me going to buy a Patek Philippe band that the consignment seller is pricing at $1 but being charged by the watch band company $10/month to use it. Since I am only asking for $1 at the Patek Phillips store, they only get $0.30. And I get to keep, without fee, the $10/month.

As I said , the developers created this current problem by not charging the true cost for a product that they were selling. Thus Apple was de facto forced to change that business model to handle that change. Sadly, most people, that I talk to, dislike subscription software. Thus, who is being helped by the changes: customers or software developers (ie other business entities).

 

[Sophisticatednut]

Flawed analogy: I buy an iPhone and put it in my pocket and I have zero on-going payments to Apple. And iPhone customers, based on customer satisfaction surveys, are happy.

So, let’s go back to the consignment model that Apple create in the iOS store. And apply it to your example.
I want to create a new watch band taking advantage of the branding the Patek Philippe created. Under a traditional model, I bring it to the store. The retailer buys it and then sells it with a markup. No complaints. A consignment model would look slightly different. I bring it to the store. I tell the owner that I want to sell it for $XX. The owner says, ‘OK, but I get a % of that sale price’ Again no problem.

All of the issues that Apple is no having is because developer’s decided that they no longer wanted to sell software as a product but sell it as a service. The problem is the consignment pricing model is now broken because the actual price of the product cannot be determined.

That is like me going to buy a Patek Philippe band that the consignment seller is pricing at $1 but being charged by the watch band company $10/month to use it. Since I am only asking for $1 at the Patek Phillips store, they only get $0.30. And I get to keep, without fee, the $10/month.

As I said , the developers created this current problem by not charging the true cost for a product that they were selling. Thus Apple was de facto forced to change that business model to handle that change. Sadly, most people, that I talk to, dislike subscription software. Thus, who is being helped by the changes: customers or software developers (ie other business entities).

Contrary I would say Apple is part of the problem, because you can’t sell the software as a product but a service to make up the cost.

Developers want to have the ability to skipp apples entire chain and go directly to the consumer but can’t. Or at the least inform them after the purchase about a superior offer. And the fact the 15-30% cut apple takes is in reality massive. Especially of the 50€ app I get 35€-42€ (after a year).

The consignment pricing model isn’t broken, Apple simply uses a tollbooth model. As Apple doesn’t sell the app or the function to sell it. But the ability to independently extract payment for an indefinite period.

How is it reasonable that let’s say you purchase an app in 2008, you pay 30€ but every year fr 17 years you pay 30%( untill they changed or) of any additional purchases?

If a developer includes a physical pamphlet in their software box (remember when apps came in boxes?) mentioning their website's lower prices, should Apple get a cut of those web sales if they could discern it? Obviously absurd.

But digitally, Apple claims exactly this right. They want ongoing rent from customers they didn't acquire, using services they don't provide, simply because someone once discovered an app through their store. Apple's model never ends, regardless of value provided.

 

[I7guy]

The Real Value Quantification:

Patek Philippe's Value:
Voluntary luxury in a competitive market

• You can choose alternatives or go without
• Price reflects transparent craftsmanship and brand value

Apple's App Store Value:
Mandatory tax on a captive market
No alternatives allowed by law
Price reflects bottleneck control, not service value.

Both reflect both:

Watch maker and App Store seller:
- you can choose an alternative (Rolex, android) or go without
- price reflects craftsmanship
- price reflects value to owner

Thanks for clarifying the similarities.

 

[PlayUltimate]

Contrary I would say Apple is part of the problem, because you can’t sell the software as a product but a service to make up the cost.

Developers want to have the ability to skipp apples entire chain and go directly to the consumer but can’t. Or at the least inform them after the purchase about a superior offer. And the fact the 15-30% cut apple takes is in reality massive. Especially of the 50€ app I get 35€-42€ (after a year).

The consignment pricing model isn’t broken, Apple simply uses a tollbooth model. As Apple doesn’t sell the app or the function to sell it. But the ability to independently extract payment for an indefinite period.

How is it reasonable that let’s say you purchase an app in 2008, you pay 30€ but every year fr 17 years you pay 30%( untill they changed or) of any additional purchases?

If a developer includes a physical pamphlet in their software box (remember when apps came in boxes?) mentioning their website's lower prices, should Apple get a cut of those web sales if they could discern it? Obviously absurd.

But digitally, Apple claims exactly this right. They want ongoing rent from customers they didn't acquire, using services they don't provide, simply because someone once discovered an app through their store. Apple's model never ends, regardless of value provided.

The option to bypass Apple’s payment system has always existed. Many apps do so today. Just a few examples: Netflix initially allowed for users to subscribe via the app. Now you can only do it via the app. The application Craft allows for subscription via the app or via their website, by-passing Apple’s payment system. Success Wizards only allowed subscription via the website. MindNode, likewise, enables both options.

Re: Pamphlet in a Box: I do remember those days. But subscription payment systems didn’t exist. The initial purchase would have had to have been at full price; not a partial price plus on-going payments. In addition, back in the "pamphlet in a box" days, the biggest issue for a developer was getting the word out that the application even existed. There were few places to go to learn about any application. The early days of the Apple Store used to have wall of limited software offerings. But if you were small, getting discovered was hoping to get included in the free disc in the back of magazines. Since that time, the iOS store has made it simple and easy for any developer to sell their creation in a centralized source. So the question is, should Apple be compensated for creating the store and if so how? The way Apple chose, was to charge only after a sale was made. The people that paid for the store were those that made $$ from the store. Of course, Apple had different options. They could charge a monthly hosting fee just to be included in the store. They could charge a download fee. They could charge a transaction fee for the handling of the payment system. They could increase the cost for access to the development tools. Instead, all of those things were included in a percentage of the cost of the product sold. Developers, having moved to a subscription model, have distorted what the true cost of the product is. Software is no longer a purchase but a lease. So how should any retailer be compensated when they are no longer selling a product but are instead selling a lease? In real estate, realtors are compensated based on the first years lease. However, they are no longer involved in that relationship. In the case of an iOS Store, the developer would likely still need to be involved with Apple for updates, and further development.

I do understand that developers, like everyone else, wants to make as much $$ as possible.It just seems that the focus of the current regulation is find ways to not pay Apple anything for the ecosystem that they created. Or to perhaps, more accurately, treat it as a public utility.

 

[Sophisticatednut]

The option to bypass Apple’s payment system has always existed. Many apps do so today. Just a few examples: Netflix initially allowed for users to subscribe via the app. Now you can only do it via the app. The application Craft allows for subscription via the app or via their website, by-passing Apple’s payment system. Success Wizards only allowed subscription via the website. MindNode, likewise, enables both options.

This is technically true but misleading. Yes, some apps can direct users externally but only under strict conditions and with severe restrictions. Apple's anti-steering rules explicitly prohibit:

• Mentioning price differences inside the app
• Providing direct links to external payment
• Even suggesting that alternatives exist

Netflix actually proves your point perfectly considering they removed in-app purchasing precisely because Apple's 30% cut made it economically unviable. That's not "choice", that's being forced out by punitive pricing.

And how about the small guy who can’t do what Netflix does?

Re: Pamphlet in a Box: I do remember those days. But subscription payment systems didn’t exist. The initial purchase would have had to have been at full price; not a partial price plus on-going payments. In addition, back in the "pamphlet in a box" days, the biggest issue for a developer was getting the word out that the application even existed. There were few places to go to learn about any application. The early days of the Apple Store used to have wall of limited software offerings. But if you were small, getting discovered was hoping to get included in the free disc in the back of magazines. Since that time, the iOS store has made it simple and easy for any developer to sell their creation in a centralized source. So the question is, should Apple be

But the issue is you say should Apple be payed? While they are asking for a yearly lease Ronaldo’s apps to be listed in the store. The moment you don’t pay for it you can’t list your app. Just how a store not paying rent will no longer be allowed in the mall.

compensated for creating the store and if so how? The way Apple chose, was to charge only after a sale was made. The people that paid for the store were those that made $$ from the store. Of course, Apple had different options. They could charge a monthly hosting fee just to be included in the store. They could charge a download fee. They could charge a transaction fee for the handling of the payment system. They could increase the cost for access to the development tools. Instead, all of those things were included in a percentage of the cost of the product sold.

Apple absolutely deserves compensation, but reasonable options exist:

• Annual developer fees (like they already charge 99€/year)
• Transaction processing fees (2-3% like credit cards)
• App listing fees
• Development tool licensing

The current model isn't about fair compensation, it's about maximizing extraction from a captive market. If Apple's value proposition were truly worth 30%, they wouldn't need to be so aggressively focused on blocking any price transparency or block external payment methods.

Developers, having moved to a subscription model, have distorted what the true cost of the product is. Software is no longer a purchase but a lease. So how should any retailer be compensated when they are no longer selling a product but are instead selling a lease? In real estate, realtors are compensated based on the first years lease. However, they are no longer involved in that relationship. In the case of an iOS Store, the developer would likely still need to be involved with Apple for updates, and further development.

You mention realtors getting compensated on "first year's lease"… and exactly my point! Realtors don't get 30% of your rent for the next 17 years. They facilitate the initial transaction and move on. Apple wants perpetual rent extraction.

And it’s arguably Apple who have distorted the Value by forcing developers to explore other revenue options to compensate for the large cut Apple takes irrespective of profit margins and cost to Apple

I do understand that developers, like everyone else, wants to make as much $$ as possible.It just seems that the focus of the current regulation is find ways to not pay Apple anything for the ecosystem that they created. Or to perhaps, more accurately, treat it as a public utility.

And subscription did exist, it just wasn’t allowed. You either had to sell att wholesale or addsuported. The pamphlet still exist today if I buy goods from stores.

Should a platform owner be entitled to indefinite rent extraction simply because they facilitated initial discovery? In traditional retail, stores don't get ongoing cuts of customer relationships they helped establish.

A fairer model might be: charge for actual services provided (hosting, payment processing, updates) rather than extracting rent from every transaction in perpetuity

 

[Sophisticatednut]

Both reflect both:

Watch maker and App Store seller:
- you can choose an alternative (Rolex, android) or go without
- price reflects craftsmanship
- price reflects value to owner

Thanks for clarifying the similarities.

Glad you agree Apple is rentseeking 😎

I do understand that developers, like everyone else, wants to make as much $$ as possible.It just seems that the focus of the current regulation is find ways to not pay Apple anything for the ecosystem that they created. Or to perhaps, more accurately, treat it as a public utility.

Apple is still completely free to get paid for their product. They have the developer agreement. They can increase it. Make it a revenue sharing agreement. And it’s treated like an antitrust case. The company have legal obligations when they are in such positions

Apple just can’t be lazy with their way to get payment for their services. These things are defined. Market rates is never accepted as a defense.

 

[I7guy]

Glad you agree Apple is rentseeking 😎

I’m okay with rent seeking, except Apple isn’t doing it. Rent seeking isn’t about charging your own price for your services. I’m glad we agree Apple isn’t rent seeking.

Apple is still completely free to get paid for their product. They have the developer agreement. They can increase it. Make it a revenue sharing agreement. And it’s treated like an antitrust case. The company have legal obligations when they are in such positions

Apple just can’t be lazy with their way to get payment for their services. These things are defined. Market rates is never accepted as a defense.

Glad you agree Apple is rentseeking 😎



Apple is still completely free to get paid for their product. They have the developer agreement. They can increase it. Make it a revenue sharing agreement. And it’s treated like an antitrust case. The company have legal obligations when they are in such positions

Apple just can’t be lazy with their way to get payment for their services. These things are defined. Market rates is never accepted as a defense.

If one doesn’t like the rent, buy or rent or lease somewhere else.

 

[Sophisticatednut]

I’m okay with rent seeking, except Apple isn’t doing it. Rent seeking isn’t about charging your own price for your services. I’m glad we agree Apple isn’t rent seeking.


If one doesn’t like the rent, buy or rent or lease somewhere else.

I would say they are rent seeking. And that act is defacto illegal under eu laws irrespective of harm.

That’s what Anti-steering is 🤷‍♂️
If you don’t like the laws, pick a different market.

 

[surferfb]

This is technically true but misleading. Yes, some apps can direct users externally but only under strict conditions and with severe restrictions. Apple's anti-steering rules explicitly prohibit:

• Mentioning price differences inside the app
• Providing direct links to external payment
• Even suggesting that alternatives exist

So ban all of that! I actually agree with the EU there. (Although Apple absolutely should be able to charge a commission for that link out).

Don’t say “you can’t charge for use of your property in a way you see fit”

Netflix actually proves your point perfectly considering they removed in-app purchasing precisely because Apple's 30% cut made it economically unviable. That's not "choice", that's being forced out by punitive pricing.

It didn't make it "economically unviable." Netflix got big enough with enough brand recognition that they realized the reduction in conversions from not having a way to subscribe in app was smaller than the extra 15% (they're a "reader" app, so the commission is 15%) they would get. In plain English - they'd make more money not paying Apple than they would lose by paying Apple.

And how about the small guy who can’t do what Netflix does?

Then obviously Apple's services are providing access to customers that said small guy is getting significant value in paying for.

But the issue is you say should Apple be payed? While they are asking for a yearly lease Ronaldo’s apps to be listed in the store. The moment you don’t pay for it you can’t list your app. Just how a store not paying rent will no longer be allowed in the mall.

Correct. If you don't pay your lease, you get kicked out of the mall. Stores that don't follow Apple's rules should get kicked out because they are using someone else's property without permission.

Apple absolutely deserves compensation, but reasonable options exist:

• Annual developer fees (like they already charge 99€/year)
• Transaction processing fees (2-3% like credit cards)
• App listing fees
• Development tool licensing

"The way they want to be paid isn't how I want to pay them, so I'm going to take it for free" is theft in literally every other business context.

The current model isn't about fair compensation, it's about maximizing extraction from a captive market. If Apple's value proposition were truly worth 30%, they wouldn't need to be so aggressively focused on blocking any price transparency or block external payment methods.

If it wasn't worth the 15%(in almost all cases) to 30%, then developers wouldn't pay it. But they do, because it is. Why else would a developer pay it? Again, just because you, Vestager, or Spotify doesn't value it at 15-30% shouldn't mean Apple isn't allowed to value it at that. If the price is too high, people won’t pay it.

Governments setting prices is wrong!

You mention realtors getting compensated on "first year's lease"… and exactly my point! Realtors don't get 30% of your rent for the next 17 years. They facilitate the initial transaction and move on. Apple wants perpetual rent extraction.

Apple is continuing providing a service (access to property) that they should continue to be paid for. The realtor doesn't do anything after they make the initial transaction.

And it’s arguably Apple who have distorted the Value by forcing developers to explore other revenue options to compensate for the large cut Apple takes irrespective of profit margins and cost to Apple

And subscription did exist, it just wasn’t allowed. You either had to sell att wholesale or addsuported. The pamphlet still exist today if I buy goods from stores.

Should a platform owner be entitled to indefinite rent extraction simply because they facilitated initial discovery? In traditional retail, stores don't get ongoing cuts of customer relationships they helped establish.

In traditional retail, products don’t continue to use the property of the store that the product was purchased from for the life of the product.

A fairer model might be: charge for actual services provided (hosting, payment processing, updates) rather than extracting rent from every transaction in perpetuity

Why do you think Apple charging developers a percentage of revenue earned for using Apple's property is unfair? Why isn’t Apple allowed to charge a percentage of revenue for access to its property? Honestly what is unfair about that? I really want to know.

Market rates is never accepted as a defense.

Glad you agree the EU doesn’t believe in the free market 🙂

 

[I7guy]

I would say they are rent seeking. And that act is defacto illegal under eu laws irrespective of harm.

That’s what Anti-steering is 🤷‍♂️
If you don’t like the laws, pick a different market.

They aren’t rent seeking period.

As far as picking a different market is interesting as the WSJ is reporting the EU is losing the tech race.

It’s no wonder with terrible legislation like the DMA, good at targeting American tech but bad at innovating. Good at making a global tech company behave like a public utility. Bad at stirring up competition.

They won the battle and lost the war.

 

[BaldiMac]

The value Apple provides in this regard can be related to other factors such as the first payment you do in the store, developer fees or something else. But considering in this case regarding steering and allowing alternatives payment options and offer to be made it’s limited to the initial customer acquisition.

Again, it's not a rational argument to justify the EU's approach by simply describing the EU's approach. I understand the EU's approach and disagree with it.

 

[Sophisticatednut]

They aren’t rent seeking period.

To decide whether a given Apple practice is ordinary “profit seeking” (competing on merits) or “rent seeking” (using market power to extract unearned surplus), you can apply a simple litmus test:

1. Does the practice create new value or simply shield Apple from competition?
2. Is the primary goal to improve product/experience, lower costs, and innovate or is it to erect barriers and preserve profit margins?

As far as picking a different market is interesting as the WSJ is reporting the EU is losing the tech race.

It’s no wonder with terrible legislation like the DMA, good at targeting American tech but bad at innovating. Good at making a global tech company behave like a public utility. Bad at stirring up competition.

They won the battle and lost the war.

Perhaps but that would be a different argument unrelated to the legality of the text or legal theory being correctly applied.

Again, it's not a rational argument to justify the EU's approach by simply describing the EU's approach. I understand the EU's approach and disagree with it.

I’m aware you disagree with the DMA and other eu laws. and that’s largely a philosophical question.

But it’s not related to the laws being correctly interpreted.

I’m arguing that Apple is in the wrong clearly by reading older EU case laws as well as existing antitrust laws and regulations. Apple have at least more than 5 ways to calculate their value as I mentioned. Them failing to do any work isn’t EUs fault. Heck they even referred to one example but Apple didn’t use anything 🤷‍♂️

 

[surferfb]

To decide whether a given Apple practice is ordinary “profit seeking” (competing on merits) or “rent seeking” (using market power to extract unearned surplus), you can apply a simple litmus test:

1. Does the practice create new value or simply shield Apple from competition?
2. Is the primary goal to improve product/experience, lower costs, and innovate or is it to erect barriers and preserve profit margins?

I would argue that Apple's App Store regulations significantly improve the product and experience for end users, which creates significant value for both users and developers. But I also understand that's subjective and that the EU has shown nothing that indicates they understand (or maybe they understand but don't value) good user experience. We've seen this time and time again where they intentionally make products worse, more confusing, and less safe to allow for their version of competition.

 

[turbineseaplane]

But I also understand that's subjective

An appreciated concession 🙏✌️

 

[Sophisticatednut]

I would argue that Apple's App Store regulations significantly improve the product and experience for end users, which creates significant value for both users and developers. But I also understand that's subjective and that the EU has shown nothing that indicates they understand (or maybe they understand but don't value) good user experience. We've seen this time and time again where they intentionally make products worse, more confusing, and less safe to allow for their version of competition.

For me I really despise the AppStore and think it has become worse every year in regards to finding useful apps, discovery and evaluating the quality of a lot questionable apps for be the gold standard is STEAM. But that’s for me that I would want to use something else or Apple being forced to improve the store service quality.

And Well luckily the AppStore is not prevented from working exactly how it works currently… Apple can take any fee for any purchases done in the store. Just they can’t include antisteering provisions. And rentseeking behavior on said contracts.

 

[BaldiMac]

I’m arguing that Apple is in the wrong clearly by reading older EU case laws as well as existing antitrust laws and regulations. Apple have at least more than 5 ways to calculate their value as I mentioned. Them failing to do any work isn’t EUs fault. Heck they even referred to one example but Apple didn’t use anything 🤷‍♂️

Which is all the more frustrating, since it wasn't the conversation we are having.

BM: The EU is wrong not to allow Apple to be compensated for the value that Apple's platform provides developers.
SN: Here's how the EU expects Apple to calculate their value as a store.
BM: I didn't say anything about their value as a store.
SN: The EU is clear about how to calculate their value as a store.
BM: ?!?!?!?!?

 

[surferfb]

An appreciated concession 🙏✌️

I just find it frustrating that those who clearly see no value in good user experience are setting the rules and saying "we don't see a value in good user experience, so:

1) your way of ensuring good user experience is now anticompetitive and illegal (while presuming harm and not doing the normal studies to prove that said practice is actually anticompetitive and causing harm)
2) you are now required to make the user experience worse and
3) because we see no value in good user experience, you can't charge what you think it's worth."

All while the competitor with 72% market share is free and open for anyone who wants that option. (And I'll add, despite being free and open doesn't have lower prices for developers in the main store, that almost everyone uses, so what even is the point of doing this in the first place? It's not going to increase competition - it's just taking money from Apple and giving it to Spotify because they have good lobbyists - which as @BaldiMac correctly pointed out, is the only actual rent seeking going on in this case)

 

[Sophisticatednut]

Which is all the more frustrating, since it wasn't the conversation we are having.

BM: The EU is wrong not to allow Apple to be compensated for the value that Apple's platform provides developers.
SN: Here's how the EU expects Apple to calculate their value as a store.
BM: I didn't say anything about their value as a store.
SN: The EU is clear about how to calculate their value as a store.
BM: ?!?!?!?!?

Then what’s the disconnect?
Apple is fully allowed to be compensated for the value apples platform provides to developers. Apples IAP fee isn’t questioned nor is the AppStore fee or developer fee.

This is tho completely disconnected from the value related to the alternative payment methods. as in the value of providing the initial user acquisition that makes up the 12% or 27% commission they ask. As well as the CTF

Apple claims that the “value of initial purchase is a poor measure of value delivered by App Store” and only represents a “small fraction of acquisition value to developer”​

However, beyond general references to an abstract notion of value provided by the App Store, Apple has failed to provide an alternative proxy that could serve, in Apple’s view, as a basis for determining the value of its matchmaking function.​

And the commission even provide an example: ” In this exercise, Apple can refer to relevant benchmarks, such as agreements concluded between app developers and OEMs for the pre-installation of their apps. The Commission considers that such a benchmark may be a relevant proxy.”

If Apple can’t refer to any such thing

 

[BaldiMac]

Then what’s the disconnect?
Apple is fully allowed to be compensated for the value apples platform provides to developers.

You specifically said that they are not allowed to charge for the value of their platform when charging fees on steered transactions:

Part (iii): "Not remunerate the gatekeeper for its gatekeeper value"

1. Can't charge for general platform control/access
2. Can only charge for the specific introduction service

 

[turbineseaplane]

1) your way of ensuring good user experience is now anticompetitive and illegal (while presuming harm and not doing the normal studies to prove that said practice is actually anticompetitive and causing harm)
2) you are now required to make the user experience worse and
3) because we see no value in good user experience, you can't charge what you think it's worth."

The key part is the subjective opinion of user experience and what makes it better or not.

For some folks, being able to do things how they want to do things constitutes a better user experience.

It appears to me that the EU does not feel it’s reasonable to expect folks to have to completely change platforms to accomplish some of that.

It’s an opinion that resonates with me, and you and others less so, and thus here we are. 🤷‍♂️

 

[I7guy]

To decide whether a given Apple practice is ordinary “profit seeking” (competing on merits) or “rent seeking” (using market power to extract unearned surplus), you can apply a simple litmus test:

1. Does the practice create new value or simply shield Apple from competition?
2. Is the primary goal to improve product/experience, lower costs, and innovate or is it to erect barriers and preserve profit margins?

Perhaps but that would be a different argument unrelated to the legality of the text or legal theory being correctly applied.

I’m aware you disagree with the DMA and other eu laws. and that’s largely a philosophical question.

But it’s not related to the laws being correctly interpreted.

I’m arguing that Apple is in the wrong clearly by reading older EU case laws as well as existing antitrust laws and regulations. Apple have at least more than 5 ways to calculate their value as I mentioned. Them failing to do any work isn’t EUs fault. Heck they even referred to one example but Apple didn’t use anything 🤷‍♂️

There’s a very simple definition of rent seeking. Is increased profits due to legislation? It’s that simple. Apple is allowed to profit seek. And rent seeking is not illegal but doesn’t add value.

 

[surferfb]

The key part is the subjective opinion of user experience and what makes it better or not.

For some folks, being able to do things how they want to do things constitutes a better user experience.

It appears to me that the EU does not feel it’s reasonable to expect folks to have to completely change platforms to accomplish some of that.

It’s an opinion that resonates with me, and you and others less so, and thus here we are. 🤷‍♂️

To me that's just as crazy as saying "I bought a Tesla but I also want a gas car, so Tesla should have to retrofit my car to make it run on gas" and you and others going "It's not reasonable to buy a car from another manufacturer even though dozens exist, even though we knew Teslas wouldn't run on gas when we bought it, but we DESERVE full self driving with a gas car" And the EU says "we agree it's not reasonable to buy a new car, so Tesla needs to offer a gas car - and oh, you can't charge a retrofit fee for anyone taking you up on retrofitting the car - you should have thought of that when you set the $99 order deposit fee."

But as you said, here we are.

 

[turbineseaplane]

"I bought a Tesla but I also want a gas car, so Tesla should have to retrofit my car to make it run on gas" and you and others going "It's not reasonable to buy a car from another manufacturer even though dozens exist, even though we knew Teslas didn't offer a gas car when we bought it" And the EU says "we agree it's not reasonable to buy a new car, so Tesla needs to offer a gas car"

I love you man, but this is not a great analogy.

I actually don't think there are good ones out there.

Smartphones, and the role they play in our lives now, and the importance of them ... to me places this situation somewhat in a class of its own.

It's one of several reasons that all the store, console, car, you name it, comparisons just are not very apt.