FTC Looking Into App Store Rules Regarding Subscription Services

[LordVic]

i'm not 100% on the details of this but i think steve jobs was able to thwart an anti-competitive investigation by basically saying the competition sucks (adobe flash) and would result in a less-than-perfect user experience on ios devices..
something like that

Apple was also in a fundamentally different market position at the time. so, it's a hard thing to compare to honestly.

when the iPhone was released in 2007, and generally for the first few years, Apple was a "small player" in the mobile field. yes, the iPhone shook things up, but it wasn't till the 3gs that the iPhone took a dominant market position.

Part of anti-competitiveness is the ability to use your dominant position to abuse competition. they were hardly in that place back in 2007. 2015 is a completely different ballgame however.

Is Apple being anti-competitive by monopolizing App store software distribution on iOS devices? YES
is apple being anti-competitive in the entire global market by doing so? No. they are not the dominant player (sure, biggest single phone producer, but worldwide, iOS is not dominant)

so, in reality, people don't like it? Change platforms. This is probably why the FTC is taking such a while to decide to persue or not, because unlike microsoft in the 90's, wich 95% of the desktop market, Apple is generally sitting at < 50% of the phone market.

 

[linuxcooldude]

One big difference though between mobile and edesktop computing is not just the API's, but access to the low level systems.

In standard computing, while you have access to first party API's, Such as DirectX or Apple's implementation, you are not rerquired to use them, to acheive the same results. Standard computing concepts allow you to write, and use your own API's right down to the metal if you so choose.

This is fundamentally different in Mobile as Apple in particular (not sure about google or microsoft) outright block that. You cannot CHoose not to use their API. if you don't use their API, you don't have your software on their device.

this goes part in parcel with the dominating control that could be seen as anti-competitive

Of course they want control, its their product. They deserve to make a profit off of it.

Controlling the platform also goes beyond making money from it. Controlling the platform ensures a better user experience, ease of use, better security, better integration between its other products and services.

If we let the customers control all aspects of its products, it would not be what it is today.

 

[Renzatic]

this goes part in parcel with the dominating control that could be seen as anti-competitive

Depends on how it's used. Under normal circumstances, Apple is allowed to tailor and design their platform as they see fit. If they don't want a popular API on their iDevices, it doesn't have to be there. Since they don't have the market power to enforce their own standard via blacklisting others, and didn't force their own proprietary alternative in lieu, there's nothing anti-competitive about it.

 

[LordVic]

Of course they want control, its their product. They deserve to make a profit off of it.

Controlling the platform also goes beyond making money from it. Controlling the platform ensures a better user experience, ease of use, better security, better integration between its other products and services.

If we let the customers control all aspects of its products, it would not be what it is today.

you're completely ignoring, or missing the point though.

once I buy the hardware. I OWN IT. it is MINE. its' not leased from Apple. It's not rented from Apple.

I have paid for the physicality of the entiret of the device.

I APPRECIATE that Apple has a set of API's and that have made things avalable in such a way that their software tends to work well with the hardware, and that software using their API's tend to as well.

But, I don't appreciate apple saying that no matter what, I have no right to choose to use 3rd party solutions if I so choose, and even actively persuing the ability to lock down the ability to jailbreak.

that is anti-competitive.

would I use the App store myself? yes, I trust it. but I still should have the right to NOT use it and install software from other sources.

that's my point. it's the behaviour that is anti-competitive. if A developer wants to distribute their iOS app, and use non Apple API's that they wrote themselves, Why should Apple have the sole ability to lock them out? Sure, it might not be the best experience going the other way, (hello touchwiz!) but, at least the owner of the hardware should have the right to choose.

This opinion isn't exclusive to Apple either, I believe it true of all. I am less than please for example that, should the hardware be compatible, my phone can't run WinPho, or Anrdoid, or iOS or the like (if I obtain them legally)

the hardware is mine. let me run what the fudge I want on it

 

[farewelwilliams]

Not that different from saying "If you don't like (Pick Random US Policy), then leave the country."

A rather shortsighted (and rather silly) statement, given that iOS accounts for over 80% of the enterprise market and Apple is pulling all the stops on getting government business in the US.

Apple is using its monopoly status in ways that would have made Microsoft blush.

apple had this rule when iPhone had small marketshare.

 

[farewelwilliams]

… which would be fine advice if there were any competing store fronts around. Last time I checked, Google Play doesn't sell iOS apps. Don't you early responders think ANYTHING through?

web is open, you can develop Spotify with all of its basic functionality purely through the web. i have thought it through.

 

[farewelwilliams]

If Apple allowed their App Store monopoly to have an alternative non Apple marketplace to operate, maybe your comment wouldn't sound as stupid.

But who didn't see this coming? Many here in the peanut gallery were saying this would happen.

alternative: the web. don't be so insulting.

 

[LordVic]

web is open, you can develop Spotify with all of its basic functionality purely through the web. i have thought it through.

this is a curiosity question and not meant to be anything more than fact finding:

Do web based applications (HTML5 and the like) allow for the continuation of playback while not the current app in focus?

 

[Jynto]

web is open, you can develop Spotify with all of its basic functionality purely through the web. i have thought it through.

No one cares about the mobile web. You want proof? Look at your home screen and count the icons. Now tell me how many of those are web apps.

I think I've made my point.

 

[linuxcooldude]

IMHO:

Corporations should be subject to the exact same rules and laws as, if not more restrictive rules and laws than citizen. they should be held to strict socially responsible rules.

Private citizens don't follow "strict socially responsible rules" let alone private corporations.

Corporations are here to serve humanity. They're here to create goods and services that benefit PEOPLE first.

Corporations are first and foremost here for profit, but consumers still reap the many benefits of their products and services. Just don't expect every product to adhere to your every exacting standard. Chose the product that best serves your purpose.

We're really starting to get into some heavy philosophical talk here though. IMHO again, the point of governments is to look out for the CITIZENS of the country first. Corporations are not people.

But who am I to talk, I'm just a pinko commie

First off corporations ARE people, without people a corporation would not exist.

It seems you are trying to apply Cough..Cough..Socialism..Cough to a company based on capitalism & democracy. It usually does not work.

 

[trifid]

First off corporations ARE people, without people a corporation would not exist.

Corporations aren't people, they can kill, steal, etc and they will never ever go to jail. The only way to send someone to jail is to single out a single person at a corporation, but a corporation as an entity can't be considered "a person" or "people" at least in the context of certain legal/political matters...

 

[AdonisSMU]

Well, the rules have obviously changed...if you have a monopoly in a certain field (in this case I think getting apps on i-devices may be considered just that) you may not discriminate.
So while Apple did not compete in that market (music-streaming on i-devices) it was a level playing field for all. But now that they are directly competing in that market one could easily argue that the 30% fee is discriminating against other competing services in an unlawful way...will be interesting what the ftc will have to say...

No I think this part of the law needs definition not interpretation. How can any company comply with something if they don't know what it is? This is moving target. Spotify can give users the option to get subscriptions on their own website. I did it once upon a time. What's wrong with everyone else? Everyone is too entitled and too lazy to save $3/month.

No one is discriminating against the Spotify app. Spotify was happy to overcharge iOS users before Apple got into the music streaming game. Overcharging people using in-app purchasing only matters now that Spotify has a legitimate competitor on its hands. If Spotify doesn't want to give up 30% or charge a higher price on iOS devices, they don't have to. They have options. Apple hasn't blocked them from exercising those options that they've used in the past already.

Spotify isn't a good guy here. They are bad and they arguable should be sued for the $3/month extra they were charging people without notifying them before hand that there was a cheaper method of payment.

 

[Renzatic]

No one is discriminating against the Spotify app. Spotify was happy to overcharge iOS users before Apple got into the music streaming game. Overcharging people using in-app purchasing only matters now that Spotify has a legitimate competitor on its hands.

The one fact you're ignoring here is that while they were overcharging iOS users, they weren't making any extra money off of them. And now that they're directly competing against Apple on their own platform, it's at a severe disadvantage. For them, it's either compete on price and make no profits, or raise the price there by $3 to make there what they're making elsewhere.

The simple fact is Apple makes just as much off Spotify on iOS as Spotify does without doing any of the heavy lifting in the background. If they were to split the market in half, with 50% of iOS users moving to Apple Music, while the other 50% stay with Spotify subscribers, Apple would still be making just as much money, while Spotify loses half their revenue.

 

[farewelwilliams]

No one cares about the mobile web. You want proof? Look at your home screen and count the icons. Now tell me how many of those are web apps.

I think I've made my point.

My point is, Apple provided a way for developers to provide services without going through the App Store. Don't like the App Store rules? Develop a web app. Users aren't restricted to installing web apps to their home screen, it's a free choice. Apple hasn't done anything illegal.

 

[farewelwilliams]

this is a curiosity question and not meant to be anything more than fact finding:

Do web based applications (HTML5 and the like) allow for the continuation of playback while not the current app in focus?

yes. checkout any track on soundcloud.com . It also appears on the lock screen of ways to control the playback.

 

[Renzatic]

My point is, Apple provided a way for developers to provide services without going through the App Store. Don't like the App Store rules? Develop a web app. Users aren't restricted to installing web apps to their home screen, it's a free choice. Apple hasn't done anything illegal.

In some ways, this is like saying "Walmart taking 95% of your profits, forcing you to raise prices while they successfully undercut you with their own product due to their heavy handed tactics might seem unfair, but you don't have to use them. Yeah, they might be the one place where people are most likely to see your product, but you can always set up some stalls at a bunch of local flea markets. You always have a choice."

Just because people always have an option doesn't mean everything is completely fair. If you have to get people to jump through extra hoops just to be able to compete with the competition on their own platform, or present a substandard alternative, it's not really a choice.

In this situation, Apple is being very much like Microsoft in the 90's. I mean, yeah, Internet Explorer was advertised heavily and placed front and center on Windows, but it didn't matter. Nothing's stopping anyone from firing it up to download and install Netscape. It's a free choice.

 

[AdonisSMU]

The one fact you're ignoring here is that while they were overcharging iOS users, they weren't making any extra money off of them. And now that they're directly competing against Apple on their own platform, it's at a severe disadvantage. For them, it's either compete on price and make no profits, or raise the price there by $3 to make there what they're making elsewhere.

The simple fact is Apple makes just as much off Spotify on iOS as Spotify does without doing any of the heavy lifting in the background. If they were to split the market in half, with 50% of iOS users moving to Apple Music, while the other 50% stay with Spotify subscribers, Apple would still be making just as much money, while Spotify loses half their revenue.

That's not true either. Apple pays out higher royalties to labels and publishers than Spotify does...and doesn't offer a free tier in perpetuity. There are distinct advantages to using Spotify over Apple in particular the free tier of streaming. If Spotify wants to keep all of the profits they can let people subscribe via their website as they have previously.

 

[powers74]

I know I'm only going to get flamed for this reply, so don't expect a reply after this, but anyway...

Running a giant, virtual art gallery...

That is EXACTLY what Apple does.

I should not have to pick between the operating system and the hardware I can use it on

Except that you do, sorry.

I have no choices when it comes to "cable".

That's unfortunate, I do.

Now maybe you prefer a world where companies can rip people off legally, but I do not.

No, I don't, and I don't think anyone does, but forcing a company which has built it's empire on building hardware and software that work together exclusively is completely absurd. Like other posters have pointed out, the opportunity is still there to build an alternative OS which can run on a variety of hardware on the market, but Win-tel really soured the pudding for that scheme. It's a big bag to haul. Apple's not forcing anyone to use their system, and anyone is free to sell a competing one.

Oh, wait, I forgot, software is supposed to be free, like music.

And just so I don't have to bother replying to you, no, I wasn't directing that last comment at you necessarily, just the whole "free software & music for everyone!" crowd.

But at LEAST Spotify can try to distribute directly to the consumer for those with Apple devices.

Yes, it appears as though they can.

 

[AppleScruff1]

I think Apple should get 70% of App Store revenue and raise all prices.

 

[macMD]

It has more to do with Apple intentionally forcing competitors to sell higher or at a loss if they want to sell on the App Store at all. That is an FTC issue, monopoly issue and fair trade issue.

Apples cut is what it is, you can sell your app or not on the store, but Apple also prevents any app from being able to place purchases outside the app by redirecting users to another site. So competing streaming audio sites are at a disadvantage, NOT, because Apple Music is so much better but because Apple is stacking deck against the competition in a unfair market move.

 

[Renzatic]

That's not true either. Apple pays out higher royalties to labels and publishers than Spotify does...and doesn't offer a free tier in perpetuity. There are distinct advantages to using Spotify over Apple in particular the free tier of streaming. If Spotify wants to keep all of the profits they can let people subscribe via their website as they have previously.

Does Spotify allow free streaming over the iOS app now?

But still, can you give a good reason why Apple should charge 30% of a monthly subscription for the life of the account just to run their payment processing? I know it's not the hardest thing in the world for people to hop over to the website instead of signing up in the app, but the question is...why should they?

 

[farewelwilliams]

In some ways, this is like saying "Walmart taking 95% of your profits, forcing you to raise prices while they successfully undercut you with their own product due to their heavy handed tactics might seem unfair, but you don't have to use them. Yeah, they might be the one place where people are most likely to see your product, but you can always set up some stalls at a bunch of local flea markets. You always have a choice."

this is what Amazon is doing with AmazonBasics. Amazon makes their own products at a low cost and uses their own infrastructure to distribute it to customers, while other companies selling similar products through Amazon are charged a commission.

It's ok for Amazon to do it, but Apple shouldn't be doing it? that doesn't make sense.

 

[Renzatic]

It's ok for Amazon to do it, but Apple shouldn't be doing it? that doesn't make sense.

I don't have a problem with Apple taking a commission on apps sold. Don't even have a problem with them taking 30% off the top of a sub fee once or twice. It's them skimming off the top of sub fees perpetually that I think is unfair.

 

[thekev]

this is what Amazon is doing with AmazonBasics. Amazon makes their own products at a low cost and uses their own infrastructure to distribute it to customers, while other companies selling similar products through Amazon are charged a commission.

It's ok for Amazon to do it, but Apple shouldn't be doing it? that doesn't make sense.

That is always a bad response. You made an analogy that isn't identical, yet you suggested it was equivalent. It also suggests that Apple is investigated, yet it never happens to Amazon (or presumably any other company). That would be incorrect.

 

[LordVic]

this is what Amazon is doing with AmazonBasics. Amazon makes their own products at a low cost and uses their own infrastructure to distribute it to customers, while other companies selling similar products through Amazon are charged a commission.

It's ok for Amazon to do it, but Apple shouldn't be doing it? that doesn't make sense.

I hatge this response and it shows a complete and utter ignorance.

"Amazon does it so Apple Can too!"

how about..

"Apple does it so Amazon does?"

whatch the responses. "copying" to "evil" will be the response

a logical fallacy known as "tu Quoque". or literally translated to "You Too". an attempt to shift the attention of the argument off Apple's problems by pointing out Amazon's.

At no point have anyone else in this thread said how amazon operates is much better. it's different, but it too has it's share of significant legal / business issues.

drop the discussion on amazon, and lets bring it back to Apple's business practices.