Sure.
My first suggestion is to force Apple to provide sources for iOS to competitors royalty-free and allow them to fork the operating system for their devices.
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Apple Starts Letting Developers Add Alternative App Marketplaces to App Store Connect
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My first suggestion is to force Apple to provide sources for iOS to competitors royalty-free and allow them to fork the operating system for their devices.
This. We should be encouraging Apple’s competitors to be better rather than bringing Apple down to the competitors level.
But why iOS specifically when they can already do so with Android?
Even better, make competitors create their own OS and ecosystem. Loads of different versions of the same OS isn't competition.
And being able to use someone else's OS is precisely why the market is so uncompetitive. we should ban that practice.
To benefit from the existing ecosystem of iOS apps. Obviously.
Not economically feasible.
Microsoft tried and failed - with the main reason arguably being lack of third-party apps/services.
👉 Apple in 2022 had worldwide iPhone sales (revenue over fiscal year) of more than 200 billion USD - that is more than the entire GDP of Hungary, a nation of almost 10 million people, high-income economy (according to the World Bank) and (according to Wikipedia, and I don't doubt it in this case) the "largest electronics producer in Central and Eastern Europe".
Force horizontally integrated app developers to make their apps available across all platforms. That way they can’t preference any particular platform.
If any country were to insist that Apple do this, I can guarantee you that Apple would simply withdraw from that market there and then.
I think at this point, you are just throwing out random suggestions out of spite towards Apple and it's very hard to tell whether you are even interested in fielding an honest conversation. I know I kinda have a bad rep around here as the Apple shill who thinks that Apple can do no wrong, but I do take the time to think through and craft my responses, and I stand by every word I have typed.
For one, your suggestion makes absolutely zero sense. An Apple product is the integration of hardware, software and services. How would your suggestion even work? Allow any OEM to load iOS onto their own hardware and flood the market with cheap iOS clones that undercut the iPhone? And what of Apple's services? Are competitors expected to be allowed to tap on apps like iMessage and maps for free while Apple bears all the costs?
Tell me you are not being serious here.
That's already a reality with key apps (e.g. MS Office, the most popular social media and number-independent interpersonal communication services).
It still does little to change the duopoly of Android (in, admittedly, its various flavours) and iOS.
Also, forcing developers to support a dozen or so different platforms or operating systems doesn't necessarily seem desirable in the broader picture. For very similar reasons as we don't have electricity power lines or broadband cables from a dozen operators going into every house / housing unit.
👉 Natural monopolies don't have to be a bad thing economically.
It's just that they need to be regulated to prevent their operators to leverage and stifle competition in other markets.
Exactly. That's why the "just switch to Android" argument doesn't negate the argument that there's a lack of competition.
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It's also worth noting that public utilities are still entitled to a (pretty handsome) profit. People here are essentially suggesting that Apple become a non-profit organisation.
For some people the thought of making the competition better just doesn't seem to cross their minds.It's also worth noting that public utilities are still entitled to a (pretty handsome) profit. People here are essentially suggesting that Apple become a non-profit organisation.
I'm not.
I'm being serious at stating that (in response to @mrochester above) that one can't be serious in arguing other competitors should just create their own OS and ecosystem. Or that government could just create conditions for that to develop.
Absolutely not crazy.
I've already said (e.g. here) several times that it has become a de facto or quasi-utility. And should be regulated like one. Economic or legal definitions absolutely support that.
It seems you just don't like that assertion or its consequences (possibly from a personal belief of free enterprise that government shouldn't interfere with).
I can't remember having any serious rebuttal from you or anyone else (beyond a "it's not strictly needed for survival" argument, that's invalidated by other such services being regulated as utilities in practice). Neither is labelling it as "crazy land" one.
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Apple makes that profit that from device sales.
And they have made handsome profit from a 15 years or so of App Store commissions.
No one is - and I am not.
The suggestion is that they shouldn't be unlimited in their power to exploit their platform.
I don’t like the assertion because it does not resolve the underlying issue, which is that there are not enough OS and ecosystems on the market. It’s just a sticking plaster over the problem.
At the end of the day, my internet service provider's internet connection it its property and my ISP is not wrong in believing that they are charging whatever fee they like in for access to their property.
By taking a commission on sales of digital goods or services, for instance, charged to the companies that conduct such sales over my internet connection.
Why should Apple be allowed to be freeloading on the expensive networks these internet access providers provide? And what would the Apple App Store, or Apple Music, or iCloud do without them? Ship the iOS apps I ordered to me on a USB flash drive or physical CD? And my ISP is certainly in a position to block easy access to Apple's content delivery networks.
👉 It does not seem wrong that my ISP take a fair commission from Apple for every sale through their "pipes": Every app or iCloud, Music, TV subscription sale that Apple conducts. At a fair rate of... say, 30%?
👉 Do you agree? If not, why not?
If that’s the agreement Apple has signed up to, yes they should pay. Although I’d argue access to the internet should be a regulated public utility.
Trying to come up with some sort of ‘gotcha’ argument will lead you to looking stupid.
As I said, ISPs are in a position to block access to Apple's servers - just as Apple is able to block/limit app installation with signing certificates. They can kind of force Apple to.
👉 Do you believe it's good for the overall economy and society, if intermediaries can charge such commissions at will?
For products and services that aren’t public utilities and aren’t essential services, yes. It’s up to Apple to decide how much to charge for its non-essential, non-public utility products and services.
Rubbish. An electric company, water company, ISP are public utilities. And as public utilities at least in the US there are guidelines on rates. Apple is not. Yet the EU has essentially made them into one, but as a a lifestyle, public for profit consumer facing organization, they can set their own prices for everything, including the App Store.
Your example is a red-herring.
Interesting enough, Twitch is withdrawing from the South Korean market because their ISP is attempt to tax Twitch for the bandwidth their platform uses.
I get what you are trying to do here, and I would sum up the entire debate in one word - leverage.
Rather than argue whether your Internet service provider has the "right" to charge Apple 30% or not (they certainly do in theory), I would reframe the argument as "Do they have the leverage necessary to charge Apple 30% and get away with it?"
The answer is simply - no. And the reality is that carriers are more beholden to Apple than Apple is beholden to them.
The problem with carriers is that they are largely undifferentiated "dumb pipes" and offer mainly the same service - voice, SMS, data. This gives Apple an opportunity to divide-and-conquer, which was precisely how they managed to get AT&T to not only support the iPhone, but also agree to launch the iPhone according to Apple's specifications (contrast this with how most android smartphones tend to come preloaded with carrier bloatware and settings). Verizon would go on to bleed customers to AT&T. Apple would then go on to follow this same playbook in every country they launch, and it works because Apple had all the leverage, because they have customers who care more about the iPhone than they do their carrier.
If there is any carrier who dares to try charging Apple 30% of whatever service uses their network, Apple would simply have their iPhone not support their network, and I wager the Apple effect is strong enough that even if they end up retreating to just one carrier, the majority of their user base would follow. And worse comes to worse, Apple could always just rent their own cell coverage and becoming their own carrier. Or pass on the costs to the end user.
It's also a fascinating study into how Apple Pay has slowly but surely gained ground, but that's another discussion for another day.
In contrast, I would argue that the App Store is more than just a "dumb pipe" in that regard. Through the very expensive and very profitable iPhone, Apple has aggregated the best customers in the world, and their propensity to spend speaks for itself by way of way higher App Store revenue generated compared to the Google Play Store despite the Google's higher market share. At the same time, Apple does have APIs and SDKs to help developers make better apps, and they have put in a lot of effort to condition users to trust the App Store and streamline the purchasing process.
The end result is that Apple has helped grown the overall pie by creating an environment where users purchase and download more apps than they otherwise would had there been no App Store and software had to be downloaded from the net like one would on a Mac or PC. These developers therefore make more money than they otherwise would have thanks to the infrastructure put in place by Apple.
We can argue until the cows come home as to how much a reasonable cut for Apple ought to be, but my point is, and always has been, that Apple does deserve some credit (and renumeration) for their efforts in growing the overall pie (and earnings) for app developers. This takes the form of their 30% App Store cut, which so many people here are in favour of doing away with entirely.
To put it simply, Apple has all the leverage, because they own the customers. This is more than can be said for carriers who have made no such contribution. And so I throw the question back to you - if the carrier wants to charge Apple 30%, what is their value add above and beyond every other android handset sold this way?
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I acknowledge that the App Store may have had some negative impact on innovation in the form of apps that never took off (or were never developed) either because the platform didn't allow it (eg: game streaming), or didn't support a business model that would have made it financially sustainable (subscriptions would only come in 2011, and there is still no upgrade pricing option).
However, I still maintain that iOS is Apple's intellectual property and Apple is well within their rights to monetise their own property. I would support well-crafted legislation but it needs to be honest first and foremost and say "Yes, we are violating Apple's property rights here, but it's going to take the form of a FRAND licensing structure where Apple will still get compensated at the end of the day, but we are measuring this tradeoff as a society, and Apple is still going to invest because they are making so much money and it's good for their platform and they will be adequately compensated."
And the problem is that nobody is willing to be forthcoming here, because of the implications of such an admission (one has to admit first and foremost that they are violating Apple's property rights here, however justified they may feel it to be), and this is why I want to see Apple push back all the way and force this admission out of the EU.
Whatever it takes.
Firstly, the ISP could charge what they want within their charter. But as a public utility they would have a hard time charging different customers on different schedules for the same usage patterns.
Secondly to use your own argument there is only one ISP. There is only one internet and Apple.com is Apple.com no matter whose internet you are on. Ridiculous argument, right? As ridiculous as saying the smartphone world only consists of two competitors.
Note that I'm not limiting that to mobile carriers - but fixed-line internet service providers as well.
Could be a duopoly of locally operating ISPs or infrastructure owners that Apple can't "escape".
Growing the pie: Without internet service providers, Apple would have no way of accessing the customers. And they'd of course also charge Android App Stores as well.
Their value add is similar to Apple's, when I purchase in-app game content created by Epic or a streaming subscription provided by Apple: little to none otherwise.
You said it yourself: It's just about "owning the customers".
Of course they have: Without ISPs, Apple couldn't delivery digital sales, services and subscriptions - there wouldn't be an App Store or "pie" as you call it.
That puts the concept of a gatekeeper in a nutshell.
And it also illsutrates how the DMA is not about targeting "only US tech companies" (as you said) - but companies with real gatekeeping power.
It also is enough justification why they should be regulated to maintain fair competition - when they, having "all the leverage" operate their own competing services against for example the streaming companies.
Not really.
Most of them seem are, from what I'm reading, rather arguing that the App Store should not be the only way to distribute apps. And when developers elect not to use the App Store, Apple shouldn't be entitled to a commission.
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Absolutely - I don't think the EU ever disputed that. And it, with the DMA, it confines itself to applying only necessary and proportionate measures to ensure fair competition and limit/prohibit unfair practices.
And your post above provides all the justification needed, when you're saying "Apple has got all the leverage".
The EU should break their ability to stifle or distort fair competition. Whatever it takes.
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