Apple Sued by U.S. Department of Justice, Says Lawsuit is 'Wrong'

[Iconoclysm]

The complaint cites a few examples in regards of smartwatch access to APIs and functionality:

Some of that doesn't take into account other smartwatches and their limitations. Some of these communications methods were built into the hardware and software on both ends and aren't open and available on ANY platform. There should be a period where this is allowed before requiring to be open, it's lightning and USB C all over again. Apple doesn't want the limitations of Bluetooth until someone comes up with a new standard so they did it themselves. This is why most proprietary anything happens.

 

[bcortens]

As Apple should, since they bear the expense of providing the infrastructure on which many of these apps rely to be as functional as they are (everything from the data layer in many cases, to notifications functionality, security infrastructure, and free access to all the dev tools and APIs needed to build the apps) not to mention distribution access to nearly a billion potential buyers through a consistent App Store experience available in nearly every developed country on earth. Oh, and the guarantee that the app will work on any almost every device running a currently available version of the OS released in the last 5 years.

Yes, Apple should definitely monetize for all of that.

You're misunderstanding what I mean, I think Apple should operate the App Store essentially at cost given how important the iPhone is today. If Apple wasn't one of the largest and most important tech companies in the world, sure, charge whatever they want. However so long as they are that big and important they should be required to operate their gatekeeping services in what amount to FRAND terms.

 

[Beautyspin]

Where is that a "strict no-no"? I don't see Nintendo allowing Xbox to access its APIs to sell controllers?

I think I need to make this clear before more accusations and straw men start. I am not saying it's OK...just pointing out that this isn't just an Apple thing and requires blinding yourself to the rest of technology to claim it's illegal.

When DOJ sues Nintendo, then we can talk about the disadvantages of Nintendo. This suit is specific to Apple.

From the DOJ suit, the following is clear. Since this is a point about which they are suing Apple, according to DOJ and 17 states, it is a strict no no.

"Smartwatches are an expensive accessory that typically must be paired to a smartphone. Smartwatches that can be paired with different smartphones allow users to retain their investment in a smartwatch when switching phones thereby decreasing the literal cost associated with switching from one smartphone to another, among other things. By suppressing key functions of third-party smartwatches—including the ability to respond to notifications and messages and to maintain consistent connections with the iPhone—Apple has denied users access to high performing smartwatches with preferred styling, better user interfaces and services, or better batteries, and it has harmed smartwatch developers by decreasing their ability to innovate and sell products."

 

[bsolar]

When did it start?

The antitrust probe started in 2019.

 

[Iconoclysm]

Except that McDonald's doesn’t have near the dominance in its business that Apple has in mobile OS. There are only two major players in mobile OS: iOS (with over 60% share in the U.S.) and Android. It's Apple's dominance combined with anticompetitive behavior that are at issue here.

I keep seeing the claim of iOS's share in the US go higher and higher every time it's brought up.

 

[StrongArmmed]

Big twenty four hours for Team Biden. First, doing much more with its regulatory authority to shove EVs down our throats on Wednesday. Then taking on arguably America’s biggest and most successful company today. Good to see their priorities are in the right place.

In their defense, this nonsense was started under the previous administration. The bureaucrats below AG don't care who's in office. As long as they can get sign-off to proceed with their case...

 

[sleeptodream]

That is at the core of what EU forces on Apple, but this DOJ case goes further.
It seeks to deny Apple to take advantage of developing multiple devices (HW and SW), then making them interoperate better than the mix-and-match competition. I think this is ridiculous.

Right? This is literally why people buy Apple products.

A lot of their integration also comes down to having specific chips in their devices to enable that integration, that third party devices will never have. How exactly are they supposed to make a random smart watch or earbuds work as well as their own products with custom hardware? This is Apple’s forte because they’re so vertically integrated, and what makes them so special.

I’d be fine with it if they just force the Apple watch to have basic functionality when paired with an Android phone, but saying they need to work identically is crazy

 

[NT1440]

You completely missed the point. They were saying that Apple has no right to censor apps under the guise of "protecting health data", something new regulation should address.

What is being censored? What apps haven’t been approved because they make private API calls?

 

[bsolar]

Some of that doesn't take into account other smartwatches and their limitations.

No, those detail limitations imposed by Apple's platform on third-party smartwatches regardless of what the manufacturer of the third-party smartwatch does.

 

[jgdeschamps]

Except that McDonald's doesn’t have near the dominance in its business that Apple has in mobile OS. There are only two major players in mobile OS: iOS (with over 60% share in the U.S.) and Android. It's Apple's dominance combined with anticompetitive behavior that are at issue here.

McDonald's is one of the dividend aristocrats at Wall Street, and no other burger business has achieved that level. Their dominance in the burger market is the equivalent to Apple's in tech, or Coca-Cola for soft drinks world-wide.

 

[Iconoclysm]

So? Traditional distribution is so far removed from the cost structure of the way apps are distributed today that it is almost irrelevant. The pre-digital world is different to the post-digital world and trying to apply non-digital world rules to the digital-world makes very little sense IMO.

So? The person shouldn't have made that claim!!! That's it, you injected yourself in it to talk about something completely different...and it STILL isn't true. Before iPhone existed, you were paying Verizon for access to software on phones on their network, Cingular, whatever. Digital store fronts have existed for nearly as long as digital distribution, and they weren't set up as a charity.

 

[ggibson913]

There goes the Biden admin demonstrating again to the whole world they have no idea what US antitrust law is or how technology works. Apple has plenty of anti-competitive practices that need to be addressed, but this ain't it.

Wow I am gonna have to vote for Biden again then. In between legislative efforts, dealing with two major world conflicts, and campaigning for President, he has the time to specifically and personally order the DOJ on which anti trust cases to file and why they should file them.

That’s a lot of balls in the air at the same time, he must be a super human genius.

 

[mcnallym]

If apple didn’t profit off of the iPhones they sell, you may have a point.

Countless of smaller companies than apple manage to be profitable without having to force their customers to give them more money after the product is sold. Apple was like that before the iPhone.

Imagine buying a house and the builder gets to get a cut of everything that enters your household. Apple wants just that.

There lies a big fault here. I as the consumer don’t give apple extra money.

when I go to supermarket I have options

cash
debit card
credit card
Apple Pay via phone.

I pay be exact same price no matter which option i take.

if I pay cash the supermarket pay the bank a fee,
if I pay debit card supermarket pay the card provider
same with credit card but usually a larger fee.
Apple Pay then apple get there cut

however I am paying the same price.

same with the App Store. When I buy an app then the developer sets the price factoring in their time to develop the app, and what they want to make. when I pay then apple takes a slice from the developer, not me.

 

[Samplasion]

What is being censored? What apps haven’t been approved because they make private API calls?

Note that I used "censor" a bit liberally in my previous post, but anyways, that's not what I meant either.

I meant that Apple exerts complete control over any aspect of iOS app distribution and then justifies it by saying "it's for the safety of our users' data".

(Besides, if apps were censored we most probably wouldn't know about them)

 

[visualseed]

Eyeopener for many people here. DOJ addresses this and I think the 30% cut will go away if DOJ wins the case.

Wording from the suit.

"When developers imagine a new product or service for iPhone consumers, Apple demands up to 30 percent of the price of an app whose content, product, or service it did not create. Then when a consumer wants to buy some additional service within that app, Apple extracts up to another 30 percent, again for a service Apple does not create or develop. When customers buy a coffee or pay for groceries, Apple charges a fee for every “tap-to-pay” transaction, imposing its own form of an interchange fee on banks and a significant new cost for using credit cards. When users run an internet search, Google gives Apple a significant cut of the advertising revenue that an iPhone user’s searches generate."

So, the DOJ and attorneys of 17 states believe that Apple's behavior is rent-seeking.

Percentage royalty licensing is well enshrined in US law and international treaties. The DOJ is well within their rights to argue it's "rent-seeking", but it will be an uphill battle and few courts are going to buy that argument and set off the cascade of unintended consequences across the broad swath of industries that a precedent affirming it would cause.

 

[Iconoclysm]

No, those detail limitations imposed by Apple's platform on third-party smartwatches regardless of what the manufacturer of the third-party smartwatch does.

No, I'm referring to the limitations you would find without developing your own solution to get around them. For instance, Apple's H1 chip in AirPods. You get reduced functionality from the AirPods on an Android device. You get less functionality from other earbuds on iOS. Because in this case they have to rely only on what Bluetooth can do, without the added functionality provided by hardware on both ends.

What I'm saying here is that a lot of these companies are complaining that Apple makes proprietary things, which is not an abuse if it is actually to overcome the limitations of a standard.

 

[Samplasion]

There lies a big fault here. I as the consumer don’t give apple extra money.

when I go to supermarket I have options

cash
debit card
credit card
Apple Pay via phone.

I pay be exact same price no matter which option i take.

if I pay cash the supermarket pay the bank a fee,
if I pay debit card supermarket pay the card provider
same with credit card but usually a larger fee.
Apple Pay then apple get there cut

however I am paying the same price.

same with the App Store. When I buy an app then the developer sets the price factoring in their time to develop the app, and what they want to make. when I pay then apple takes a slice from the developer, not me.

That's what you see, which is fine but not the entire truth. Supermarkets offset the price of their products so that they make a profit *and* don't lose out on the payment processing fees. Same with many (not all) developers. You can lie to yourself and say you aren't paying or recognize that one way or the other you're paying more than if the fees weren't ever levied in the first place.

 

[bcortens]

So? The person shouldn't have made that claim!!! That's it, you injected yourself in it to talk about something completely different...and it STILL isn't true. Before iPhone existed, you were paying Verizon for access to software on phones on their network, Cingular, whatever. Digital store fronts have existed for nearly as long as digital distribution, and they weren't set up as a charity.

There is a distinction between whether the platform vendor always received a percentage of all sales vs the store itself. The comment you started out responding to appeared to claiming that the software platform never used to take a share of sales, which was also my point. The store taking a share of sales that are facilitated by the store is a separate issue.

 

[DocMultimedia]

Go buy a droid. Yeesh.

 

[q64ceo]

All Apple needs to do is allow iOS devices to be computers. Like the Mac, let me install software I want, even if Apple doesn’t like the content.

Precisely this

It's not a problem for a Mac. It won't be a problem for the iPhone.

This is about nickel and diming their customers.

 

[Samplasion]

Go buy a droid. Yeesh.

Move out of the US if you don't like their laws, like come on

 

[Beautyspin]

This is what happens when you aren't obedient and cooperative and loading up your large tech company with ex-CIA officers like Google and Meta. “Nice company ya got there...It'd be a shame if something happened to it....”

Nice try. Apple is the last Big Tech company the DOJ is suing. Meta and Google have already been sued.

 

[CouldBeWorse]

Is there a legal difference between defend and vigorously defend? Why do people always add vigorously? I assume no one wants to casually defend themselves?

This is precisely the kind of pedantry I came to the comments section for

 

[dizmonk]

This case is going to take 5-7 years and the government will lose. It's a waste of time and tax dollars.

 

[bsolar]

What I'm saying here is that a lot of these companies are complaining that Apple makes proprietary things, which is not an abuse if it is actually to overcome the limitations of a standard.

None of the examples cited is like that though. From what I read, the DoJ alleges that Apple would have the ability to open those APIs and features to third-parties if they wanted to, thus enabling said third-parties to implement the same functionality the Apple Watch is currently able to offer.