Epic Games and Spotify Say Apple's Latest DMA Changes Are 'Illegal' and 'Deliberately Confusing'

[jakey rolling]

I have not, as the only outcome they are pushing for is completely free distribution and the DMA is the stick they are attempting to wield here.

Well, considering Epic and Spotify both build their own platforms, manage all of their own distribution of software and services, offer their own payment services, and do all of the heavy lifting to serve their customers and are not asking Apple to provide any services at all, I'm not sure why you think they should pay anything to Apple outside of a token fee to access the development tools and APIs needed to compile software that runs on Apple's OS.

 

[Mrkevinfinnerty]

That is the thing. Not all publishers are brave enough to call out Apple. Which tells you something about the relationship between Apple and publishers.

I agree and they have put this on the radar of regulators and most don't want to risk reprisals from Apple.

It should be the lawmakers who decide the terms here though, Spotify/Epic suggesting their acceptable terms will just lead to a sweetheart deal for them and everyone else continues with the same terms.

There have been lots of examples of this.

 

[mdatwood]

I can't believe anybody would defend Apple in this situation.

Comparison to consoles. Consoles are sold at a hardware loss. The hardware is subsidised so they can get licensing fees from them. Game companies understand this and are essentially subsidising the hardware to get more people into that consoles ecosystem and sharing the cost with the console owner for it's development etc. to make it easier to get into gaming. Apple products are sold at a premium with industry leading profits, more akin to buying a computer than a subsidised console.

Consoles haven't sold at a loss in awhile (and Nintendo famously never has except maybe the 3DS and WiiU), but even if they did it doesn't matter. My guess is consoles are nervously sitting on the sidelines hoping Apple can navigate this situation. Because if the iPhone is forced to be open and developers can bypass any API licensing fees, it will put the consoles business models in jeopardy.

 

[mdatwood]

Well, considering Epic and Spotify both build their own platforms, manage all of their own distribution of software and services, offer their own payment services, and do all of the heavy lifting to serve their customers and are not asking Apple to provide any services at all, I'm not sure why you think they should pay anything to Apple outside of a token fee to access the development tools and APIs needed to compile software that runs on Apple's OS.

I could see Apple moving to a model like Epic uses for UE in order to access the iOS APIs.

https://www.unrealengine.com/en-US/license

Forcing the hardware open would mean work could be done to port linux or Android onto the iPhone though. And maybe after enough time apps could use that royalty free.

 

[Mrkevinfinnerty]

Consoles haven't sold at a loss in awhile (and Nintendo famously never has except maybe the 3DS and WiiU), but even if they did it doesn't matter. My guess is consoles are nervously sitting on the sidelines hoping Apple can navigate this situation. Because if the iPhone is forced to be open and developers can bypass any API licensing fees, it will put the consoles business models in jeopardy.

I don’t think anybody cares about consoles enough to bother regulating their business model.

The PS4 sold around 120 million units total. Apple moves twice that many iPhones in a year.

 

[Sophisticatednut]

You seem to be the expert here, so can you explain to me how "tying Teams with its core SaaS productivity applications" is any different from the vertical integration of different products with Office like they've been doing for over 30 years?

When MS decided to offer Outlook as part of Office, would that not be the same as tying Teams with its core SaaS productivity applications?

Well I would need to read in the legal arguments, but in the surface is the fact they haven’t had a legal complaint brought to the court.

Secondly it’s likely because it’s actually a relevant market in the same way internet explorer and windows media player was ruled to be anticompetitive for being included for free and making it hard for other services to compete on equal terms as it’s just the default option.

But if you want a good understanding you should read this 25 page document as it outlines how article 102 is interpreted in regards to antitrust.

Council Regulation (EC) No 1/2003 of 16 December 2002 on the implementation of the rules on competition laid down in Articles 81 and 82 of the Treaty (Text with EEA relevance)

And
Article 102

(ex Article 82 TEC)

Any abuse by one or more undertakings of a dominant position within the internal market or in a substantial part of it shall be prohibited as incompatible with the internal market in so far as it may affect trade between Member States.

Such abuse may, in particular, consist in:

(a) directly or indirectly imposing unfair purchase or selling prices or other unfair trading conditions;

(b) limiting production, markets or technical development to the prejudice of consumers;

(c) applying dissimilar conditions to equivalent transactions with other trading parties, thereby placing them at a competitive disadvantage;

(d) making the conclusion of contracts subject to acceptance by the other parties of supplementary obligations which, by their nature or according to commercial usage, have no connection with the subject of such contracts.

--------------------------------------------------

 

[I7guy]

How are they freeloading? They wont be using anything on Apple's app store, they will be using someone else's app store and someone else's payment system. So, if they are not going to use Apple's app store or their payment system, how is that 'freeloading when they are using nothing of Apples? apart from what they already pay for (they already pay the yearly app developer fees that allows them to use app developer tools).

All that stuff under the covers called iOS in the freeloading part. The EU is playing Robin Hood and giving away apples intellectual property for free.

 

[Jago]

All that stuff under the covers called iOS in the freeloading part. The EU is playing Robin Hood and giving away apples intellectual property for free.

You seem to be misunderstanding a lot of things. Forcing Apple to make it possible for other app stores to exist and be usable on iOS has absolutely nothing to do with "giving away intellectual property".

You also seem to have misunderstood the Robin Hood story - he's the good guy in that story. Trying to scream "Robin Hood!" as if that was a bad thing is facepalm worthy cringe.

You also seem to misunderstand what exactly is the proper and generally desired course of action when a traditional grocery store chain gains too much power in it's market.

Your "With regard to the DMA - mobile digital stores are no different than their physical counterparts" claim is correct though. You just somehow arrive at the wrong conclusion - OF COURSE both kind of stores gaining a dominant market position can and should and thankfully often does lead to redoubled efforts to ensure the dominant position is not abused to strangle competition.

 

[delsoul]

I’m going to open a Honda vehicle dealership within the EU. And I’m going to complain that Mercedes-Benz refuses to allow me to sell my vehicles on their lot. Maybe if I moan enough, they’ll force MB to let me sell my Honda’s alongside them. You know….in the spirit of fairness and competition. Take that, MB! You gatekeepers, you! 😂

 

[MauiPa]

And you can always trust epic games and Spotify. LOL

 

[TLuc]

For Epic and Spotify it will be never enough, they made a business model out of complaining about the AppStore so that’s the only reason why they will be always against.

Maybe Spotify can start by paying the artists more, they are the least paying streaming service out there and they don’t deserve to be the Robin Hood in this hole EU joke.

I really don't understand these types of comments.
Of course they said that, what did you expect them to say? "Oh, thank you apple for making things more expensive, more complicated and more illegal, this is what any app developer wanted ".

 

[TLuc]

I can't believe anybody would defend Apple in this situation.

Taking in consideration past experiences on this forum I would be shocked if users here wouldn't defend them on this matter.
Anyway it will be glorious when EU will properly smack apple for these shenanigans, I guarantee the law will become cristal clear after that. Google was imposed around 10 billion $ in fines until they understood they had to follow the law. Now with DMA there's no problem with Google, which is weired.

 

[surferfb]

22% of iPhone sales in the EU is pretty low?? If iPhone sales dropped by 22% in one quarter, the stock would quit literally fall through the floor and Timmy wouldn't get his bonus. This is not counting other devices and Appstore sales.

While Apple isn't going to pull out of the EU, the EU does not make 22% of iPhone sales. It's like 7-8%. Apple's definition of Europe includes the EU, non-EU countries in Europe (the UK, Switzerland, etc.), Turkey, Israel, and the rest of the Middle East.

 

[I7guy]

You seem to be misunderstanding a lot of things. Forcing Apple to make it possible for other app stores to exist and be usable on iOS has absolutely nothing to do with "giving away intellectual property".

There is no misunderstanding here. It’s exactly what the dma is doing.

You also seem to have misunderstood the Robin Hood story - he's the good guy in that story. Trying to scream "Robin Hood!" as if that was a bad thing is facepalm worthy cringe.

This is exactly what the dma is doing.

You also seem to misunderstand what exactly is the proper and generally desired course of action when a traditional grocery store chain gains too much power in it's market.

Too much power is subjective. Considering the totality of apples worldwide market share. Influential? Certainly.

Your "With regard to the DMA - mobile digital stores are no different than their physical counterparts" claim is correct though. You just somehow arrive at the wrong conclusion - OF COURSE both kind of stores gaining a dominant market position can and should and thankfully often does lead to redoubled efforts to ensure the dominant position is not abused to strangle competition.

Whether apple has “abused” its position is a judgement call. No two people will have the same thoughts.

 

[macfacts]

What "service" is Apple providing to vendors who wish to offer their own app store running on their own cloud service, using their own payment systems?

According to many apple fans the service is access to their user base.

And I too can argue that Apple has aggregated the best customers in the world thanks to the premium pricing of their products. This means that iOS users have more disposable income and possess a higher propensity to spend, meaning more potential revenue for iOS developers.

 

[surferfb]

Taking in consideration past experiences on this forum I would be shocked if users here wouldn't defend them on this matter.
Anyway it will be glorious when EU will properly smack apple for these shenanigans, I guarantee the law will become cristal clear after that. Google was imposed around 10 billion $ in fines until they understood they had to follow the law. Now with DMA there's no problem with Google, which is weired.

When all the EU defenders who think EU regulation is making their lives better realize they are living a tech backwater in 5-10 years, and the user experience of smartphones in the EU is as frustrating as using the web in the EU, do we think they will blame the EU regulations, or will they blame Apple and other big tech companies for "malicious compliance?"

 

[TLuc]

Apple just needs to ditch EU controlled markets at this point. EU thinks they know how a phone’s OS should be? Build your own then. I’d imagine many of the EU members have bigger issues to worry about in their respective countries, but this is their focus…

I would be glorious to see something like this happen and of course want will follow, a PR disaster of epic proportions and a word record breaking stocks crash, an assured road to sub 1 trillion in value at the least. Also apple's overall business would shrink with no way to get back to previous levels. Analysts will call it "one of the biggest mistake in corporate history".

 

[jgreg728]

Apple shouldn't pull put of the EU entirely but I'd love to see a headline saying "Apple shutting down the App Store and all services in the EU". No one gets anything. Clearly the only answer that's "fair" for everyone as Epic and Spotify keep whining about.

 

[TLuc]

When all the EU defenders who think EU regulation is making their lives better realize they are living a tech backwater in 5-10 years, and the user experience of smartphones in the EU is as frustrating as using the web in the EU, do we think they will blame the EU regulations, or will they blame Apple and other big tech companies for "malicious compliance?"

If apple can't follow the law like everybody else is doing(like Google, Microsoft and Amazon) they should just pack their bags and Goodbye.

 

[surferfb]

If apple can't follow the law like everybody else is doing(like Google, Microsoft and Amazon) they should just pack their bags and Goodbye.

They're not going to pack their bags and say goodbye - you'll just stop getting the exciting new features; or will get them long after everyone else does.

MG Siegler did a good job of explaining your future here:

The EU, Trapped in Tech Amber

I hope they like current tech because they may not get future tech...

spyglass.org

Ben Thompson did an even better job, but it's a much longer article

The E.U. Goes Too Far

Recent E.U. regulatory decisions cross the line from market correction to property theft; if the E.U. continues down this path they are likely to see fewer new features and no new companies.

stratechery.com

For what it's worth, both authors agree Apple should open up the App Store and allow side loading, they just think the DMA is a terrible way to do it.

 

[jakey rolling]

All that stuff under the covers called iOS in the freeloading part. The EU is playing Robin Hood and giving away apples intellectual property for free.

You seem like someone who has been around for a while, so I will pretend that you just simply forgot that operating systems have existed for decades and that providing development tools and SDKs for third party development is part of the job of being an operating system developer.

The EU isn't giving anything of Apple's away for free. They haven't told Apple that they can no longer charge a normal annual fee for access to development tools, and they haven't told Apple that they cannot continue to charge the same fee for providing the same services for hosting apps on the App store. The EU is only telling Apple that they can no longer coerce developers into only utilize Apple's store to distribute applications.

 

[davide_eu]

Which is insane, considering the whole value proposition of Office is to offer an integrated bundle of productivity and comms tools.

Basically, the DMA threatens any Gatekeeper-designated company a fine of 10% of their global revenue regardless if they offer any new services without making them immediately available to competitors.

The fact that vertical integration has been a company's business model for 40 years plays no role.

I get that tech companies need to be regulated and that network effects give big tech companies unfair amounts of power, but the DMA is such a hamfisted and stupid framework that causes as much harm as it does good.

Unbundle as commercial offer; it is still integrated, but you should ask two different bids

 

[TLuc]

They're not going to pack their bags and say goodbye - you'll just stop getting the exciting new features; or will get them long after everyone else does.

MG Siegler did a good job of explaining your future here:

The EU, Trapped in Tech Amber

I hope they like current tech because they may not get future tech...

spyglass.org

Ben Thompson did an even better job, but it's a much longer article

The E.U. Goes Too Far

Recent E.U. regulatory decisions cross the line from market correction to property theft; if the E.U. continues down this path they are likely to see fewer new features and no new companies.

stratechery.com

For what it's worth, both authors agree Apple should open up the App Store and allow side loading, they just think the DMA is a terrible way to do it.

Big deal, then they will lose custumers and maybe in a few years their market share will shrink so much people won't notice if they leave 🤣

 

[Jago]

There is no misunderstanding here. It’s exactly what the dma is doing.

This is exactly what the dma is doing.

Too much power is subjective. Considering the totality of apples worldwide market share. Influential? Certainly.

Whether apple has “abused” its position is a judgement call. No two people will have the same thoughts.

It's a great thing then that we have legislation that attemps to quantify subjective criteria and a court system to clarify things in any and every incident where the limits are not clear.

And you still haven't explained anything regarding your claim how DMA is supposedly giving away Apple's intellectual property for free.

 

[jakey rolling]

I’m going to open a Honda vehicle dealership within the EU. And I’m going to complain that Mercedes-Benz refuses to allow me to sell my vehicles on their lot. Maybe if I moan enough, they’ll force MB to let me sell my Honda’s alongside them. You know….in the spirit of fairness and competition. Take that, MB! You gatekeepers, you! 😂

I love how Apple fans just make up stuff that doesn't even resemble reality to try to make some kind of weird argument. It certainly is entertaining.