U.S. Antitrust Committee Likens Tech Companies Including Apple to 'Oil Barons and Railroad Tycoons'

[Chrjy]

The thing is, it can be argued that they're hurting others with their decision making because of their dominant position in the market. Apple and Google effectively have duopoly on the smartphone market. Apple's position on game streaming apps is an example of the ability to hurt others.

True I guess, but what's to stop another developing a competing app store or similar. Before the App Store or the iPhone, there were other options for buying a smartphone or installing software but Apple decided they could do it better and went ahead and did just that. It's hardly their fault that nobody else wants to take up the challenge and compete against them, or Android for that matter.

Historically, we've seen it many times before when a company has been able to compete against the best of the best and win. It's the cycle of business. As with Apple, it's unlikely they'll stay at the top forever, someone else will come along and displace them at some point.

 

[jonblatho]

True I guess, but what's to stop another developing a competing app store or similar.

…Apple is. That’s…the whole point of why this is even an issue for them.

 

[vipergts2207]

Government getting involved and making things worse? Say it isn't so!😱

Apple has competition: Android.

Why is it Apple's fault (or Android's) for not having a worthy competitor outside these two choices? Nobody is being FORCED to buy Apple (or Android). They're successful because they worked hard and intelligently and created something people want to become successful. Don't punish them now because people want want they're selling.

If Apple is broken up, then their products become garbage. So would Android I guess (lol).

They're not "railroad or oil tycoons", lol. Those and Bell where out there telling people and other businesses "no you can't actually build there. We own it. Sorry."

show me how Apple is telling anyone they can't build a competing platform.

Palm and Blackberry tried but they just werent good enough and people didn't choose them. Explain how that's Apple's fault?

Apple isn't telling anyone they can't build a competing platform (if you mean hardware and software), but once the players are set, it's nearly impossible to change it. Just look at Microsoft and Apple, still by far the most dominant players in PCs decades later. So while lawmakers and regulators could take the view of "well technically someone could build a competing platform," they have to work within the confines of reality and in that reality nobody is unseating Apple or Google in the smartphone market. It's from that fact that policy should be based upon, not some technically possible, but highly improbable scenario.

When it comes to just software though, Apple is saying that you can't come build a platform here actually. If you think about it, a consumer should be allowed to install whatever they want on their phone, just as with PCs.

 

[Unregistered 4U]

I always struggle with the monopoly argument and it might be because I misunderstand it but I see it quite simply:
Any company, let's take Apple (as it's appropriate!) started from nothing, just an idea. Steve Jobs and Steve Wozniak started the company from a garage in Cupertino and managed to grow it into one of the most successful companies ever. Starting a company is easy, creating a successful company is incredibly hard, especially to get to the size and turnover of Apple.

As soon as a company becomes successful, they get slammed and people try to bring them down. It seems to be the same with people who become famous, once they get to a certain stratosphere, people love to try and pull them down and I find that really sad. Why do we live in a world of such hate rather than celebrate successes.

If a company such as Apple is able to be successful without hurting others or selling others (Google, Facebook etc!) then shouldn't that be something to cheer about?

Again, I reiterate, it maybe my lack of understanding but I'm pretty simple!

No, you’re right, a monopoly can be defined as narrow as the person making the definition want it to be. However, whenever you need to use a company is trademarked name in order to narrowly define a market, you’re no longer defining a market, you’re defining a company’s product.

 

[symphony]

Okay, but these developers used Apple’s tools and software. It doesn’t make sense to allow people to dirty up Apple’s ecosystem just because Apple has become huge.

 

[78Bandit]

Ultimately I think Apple will be forced to separate the app store distribution from the payment processing. You'll see all apps be allowed to use third-party payment systems if they want and not be forced to have in-app purchases for only certain industries. Currently Uber is distributing its app to millions of users and collecting billions in revenue without paying Apple anything outside the developer license. Fortnight, on the other hand, was forced to offer payments through Apple's system for a 30% vig with no ability to even refer to an outside payment system in the app. All developers will eventually be put on the same playing field.

The question then is how does Apple monetize the app store once they lose the leverage of mandatory in-app purchases? Do they start charging developers per download or do they increase the basic developer fee? And how do they do it in a way that still doesn't look like they are unfairly using their gatekeeper status to artificially inflate costs?

 

[GeoStructural]

Seems like AWS is the 50,000 lb gorilla in the room. There are other players/cloud providers, just like there are other App stores.

It is not the same thing. In that segment Amazon faces strong competition from Microsoft, Google, and many other powerful companies. The App Store has ZERO competition.

If you talk about smartphone market share that's another story, but your comment seems to suggest the same old discourse of people here: That you should abandon your device or your software development activities if you don't like how Apple is running the business, and quite frankly: NO, they should not, they should fight for what they believe to be right.

 

[NoNothing]

Last I checked AWS wasn’t a dominant market force for antitrust purposes. A (the?) leading cloud services provider, sure, but there’s strong competition in that market.

Last I checked, there was very strong competition in the App Market with Amazon, Google and Apple all playing.

 

[I7guy]

It is not the same thing. In that segment Amazon faces strong competition from Microsoft, Google, and many other powerful companies. The App Store has ZERO competition.

If you talk about smartphone market share that's another story, but your comment seems to suggest the same old discourse of people here: That you should abandon your device or your software development activities if you don't like how Apple is running the business, and quite frankly: NO, they should not, they should fight for what is right.

Not correct. A number of different cloud providers and app stores provide competition. It all depends on how narrow, the word “competition “ is sliced.

And apple will fight for what they believe is right as well. And yes, if you don’t like the heat get out of the kitchen.

 

[Unregistered 4U]

The question then is how does Apple monetize the app store once they lose the leverage of mandatory in-app purchases? Do they start charging developers per download or do they increase the basic developer fee? And how do they do it in a way that still doesn't look like they are unfairly using their gatekeeper status to artificially inflate costs?

They don’t really HAVE to monetize it. They can announce plans to shut it down giving all developers 1 year to inform their customers and have them switch to Windows, macOS or Android. Then, they develop all the important apps like YouTube themselves.

The App Store has ZERO competition.

In what market? And remember, if you use a company’s trademarked name in the description, you’re not talking about a market. You’re talking about a company‘s product.

 

[jonblatho]

Last I checked, there was very strong competition in the App Market with Amazon, Google and Apple all playing.

If you’d read the report (or even the article), that’s not what the subcommittee found because there’s no such thing as an “app market,” or if there is it’s not meaningful for antitrust purposes.

 

[Art Mark]

I suspected this was coming, but the court case over Apple's app store would be fascinating, as it touches on the right of any store to enforce a wholesale fee/price. And opens up TONS of questions about companies being allowed to do anything that is vertically aligned. I don't buy the anti-trust info, but Apple could remove this by forming a separate company out of the App Stores like Filemaker used to be. Good luck then with the case.

 

[rjohnstone]

Around page 340 it starts to get to the meat of the issue.
Just read the whole section on Apple, and they are in for a rude awakening.

This all for me, none for thee, attitude is not going too sit well with lawmakers for much longer.
Especially after Apple openly admits it can copy ideas from apps submitted to the App Store, but the reverse is not allowed by developers.

"In response to the requests for information, Match Group, Inc. told the Subcommittee that Apple has a history of “closely monitoring the success of apps in the App Store, only to copy the most successful of them and incorporate them in new iPhones” as a pre-installed app.2304 Phillip Shoemaker, former director of app review for the App Store, similarly told Subcommittee staff that during his time at Apple an app developer proposed an innovative way to wirelessly sync the iPhone and Mac.2305 The app did not violate any of Apple’s Guidelines, but it was rejected from the App Store nonetheless.2306 Apple then appropriated the rejected app’s feature for its own offerings "


" Mr. Cook’s statement that Apple’s apps play by the same rules as other apps appears contrary to Apple’s stated policies. While the Apple Developer Agreement provides Apple the right to replicate third-party apps, Apple’s Guidelines direct developers not to “copy another developer’s work” and threaten removal of apps and expulsion from the Developer Program for those that do.2313 Further, the Guidelines instruct developers to “[c]ome up with your own ideas,” and admonishes them “[d]on’t simply copy the latest popular app on the App Store, or make some minor changes to another app’s "



Read it all before you make any judgments. Apple is just as sleazy and slimy as the rest of them, and they have no remorse in stealing your ideas and booting you from the platform.

 

[Dekema2]

No matter how much you like seamless ecosystems and one stop shops, you cannot be blind to oligopolies and monopolies. 30 years ago there were tons of media companies out there. Now there's only a handful.

Amazon has the retail market cornered to the point where other companies with similar supply chains can't even compete in the same space, and what isn't visible is what's most damning - AWS. Much like the power grid, the internet depends on it. Google and Apple have their own issues, and I don't even think I need to go into detail on Facebook.

If you're against the antitrust agency, you're staring at a dystopian future.

 

[Abazigal]

The question then is how does Apple monetize the app store once they lose the leverage of mandatory in-app purchases? Do they start charging developers per download or do they increase the basic developer fee? And how do they do it in a way that still doesn't look like they are unfairly using their gatekeeper status to artificially inflate costs?

My guess is that Apple increases the developer fee (possibly doubling or even tripling it). Which goes against the primary goal of attracting small developers who release free apps, but that would be one way of covering the costs of running the App Store.

 

[Art Mark]

Where is it in the report how the App Store has been a godsend to both consumers and developers? Look at the fu**** metrics - downloads, unique users, rev generated, ease of WW distribution. All went off the charts with the App Store

Let’s all take a moment to remember how god damn awful software distribution was on Windows and carrier digital stores 10 years ago. It was a F**** shi* show

What a god dam crime this whole charade is

Might be best to get the court case over with. I see little hope of it convincing anyone and the implications on literally hundreds of business standards would be shredded. Good luck for any tech concern to ever again have it's own storefront with protections for consumers. I think the findings are wrong. But there's no reason to see a court case where it's legally decided as negative. Bring it on, get it over with.

 

[smulji]

lol I seriously doubt Apple will allow a third-party App Store.

After this report, they may not have a choice.

 

[Chrjy]

" Mr. Cook’s statement that Apple’s apps play by the same rules as other apps appears contrary to Apple’s stated policies. While the Apple Developer Agreement provides Apple the right to replicate third-party apps, Apple’s Guidelines direct developers not to “copy another developer’s work” and threaten removal of apps and expulsion from the Developer Program for those that do.

I would agree, this is bad and something that should not be allowed. By all means create an App Store and charge fees appropriately but DO NOT become thieves....this is very poor by Apple. If this is what is meant by a monopoly then I whole heartedly agree that this behaviour is wrong....plain and simple.

 

[canhaz]

I'm sorry but the government is correct when you step back and think about it.

Ya'll pretending like the duopoly of Apple (iOS) and Google (Android) on mobile simply doesn't exist.

Oh sure you have microG, Tizen, Windows Mobile, Amazon Store, etc blah blah blah. Those are in no shape or form serious competition to the lasting, enduring smothering duopoly we live under.

I hope the government breaks them all up. Should have done it with MS in the 90's too.

 

[AxiomaticRubric]

And they did not find Google had a monopoly on Ads

Utterly astounding

Also, why are the telecomms mysteriously absent from these discussions? Apple, Amazon, Facebook, Google, and Microsoft wouldn't be nearly as profitable without mass communication and global networks.

 

[Unregistered 4U]

If you're against the antitrust agency, you're staring at a dystopian future.

Dystopian... great suffering or injustice... because a developer has to pay 30% to Apple? The same system that has garnered some developers many hundreds of thousands, even millions of dollars?

Can’t say that I can draw that connection.

 

[JM]

Apple isn't telling anyone they can't build a competing platform (if you mean hardware and software), but once the players are set, it's nearly impossible to change it. Just look at Microsoft and Apple, still by far the most dominant players in PCs decades later. So while lawmakers and regulators could take the view of "well technically someone could build a competing platform," they have to work within the confines of reality and in that reality nobody is unseating Apple or Google in the smartphone market. It's from that fact that policy should be based upon, not some technically possible, but highly improbable scenario.

When it comes to just software though, Apple is saying that you can't come build a platform here actually. If you think about it, a consumer should be allowed to install whatever they want on their phone, just as with PCs.

Impossible, eh? I'm sure BlackBerry would love to know that it's impossible to unseat the dominant players

Apple is huge. Yep. Dominating. Yep (sort of). Surely you can see how Apple's "spark" is slowly fading, and becoming more of a commodity than a luxury. And it seems ripe for someone like a Steve Jobs type person(s) to come up and blow us all away as consumers.... and then we'll leave Apple for the next best thing.

but that will never happen if you don't allow people to know that they can get to that point where they dominate. If the government steps in and destroys every successful business, what would be the point of creating great products?

 

[AdonisSMU]

first the EU, now this ... concerning that bureaucrats are getting more and more involved in tech ...

Especially when they have at best surface level knowledge.

 

[routine_analyst]

The hilarity of it all.

A democrat lead antitrust committee now biting back at the hand that fed them.

 

[Unregistered 4U]

lasting, enduring smothering duopoly we live under.

Folks not too long ago would have said the same thing about Nokia. Funny how the government didn’t have to do ANYTHING in that case.

By the time government gets around to agreeing on and doing anything substantial, market forces will have already stepped in and made the necessary adjustments.