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

[Red Menace]

When all this started, Steve Jobs didn't want to let third-party developers build native apps for iOS at all, instead directing them to make web applications. Well, developers just better get ready. You think it is hard to get into the App Store now, wait until there isn't one.

 

[rjohnstone]

499 to be exact but not all of it directly related to Apple.

Yeah... Google is the most referenced in the doc when it comes to questionable behavior.


Another interesting bit of info is just how many companies have been swallowed up by these four.

"As noted above, since 1998, Amazon, Apple, Facebook, and Google collectively have purchased more than 500 companies.2475 The antitrust agencies did not block a single acquisition. In one instance—Google’s purchase of ITA—the Justice Department required Google to agree to certain terms in a consent decree before proceeding with the transaction. "

 

[macsimcon]

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.

Only in the U.S. does iOS have a slight lead over Android. In the rest of the world, Android dominates. There is just no way to claim Apple can illegally use monopoly power when it has 52% share in the U.S.

 

[vipergts2207]

Oops, forgot to respond to the pc comment.

is the argument that Apple should be consistent with their logic regarding software installation?

they allow app loading on the Mac as long as the developer of the software programmed it correctly. Apple chose to have an AppStore on the iPhone for reasons.

I don't think Apple has the intention of walling up the iPhone only for profits, if they did, then why wouldn't they do it on the Mac? (The last time I owned a Mac was the G4, and I could install whatever I wanted)

My argument is that a consumer should be allowed to install whatever software they want on hardware that they own. And those "reasons" have the effect of being anti-competitive, which is a no-no, especially if you're one half of a duopoly. I don't think Apple originally walled off the iPhone from outside apps for money, but that absolutely is a primary reason for maintaining that wall.

In both cases a contributing factor is simple inertia. From the early days of computing and PCs, a walled off garden wasn't a thing. When it came to the iPhone though, especially early on, a walled off app store kind of made sense. It wasn't conceived as a truly stand-alone device as it exists nowadays. It depended on a connected computer for a lot of things, even OS updates. Not being a standalone device meant that they needed an easy way to get apps onto the phone and an app store was an easy way to do that. And Apple giving developers the tools to get their software into the app store meant there would be lots of apps and quickly. At some point though the app store became extremely profitable for Apple and is a primary driver for keeping it that way. No doubt Apple should continue to benefit form the tools they created, but clearly the status quo is far too favorable to Apple.

 

[smulji]

Yeah... Google is the most referenced in the doc when it comes to questionable behavior.


Another interesting bit of info is just how many companies have been swallowed up by these four.

"As noted above, since 1998, Amazon, Apple, Facebook, and Google collectively have purchased more than 500 companies.2475 The antitrust agencies did not block a single acquisition. In one instance—Google’s purchase of ITA—the Justice Department required Google to agree to certain terms in a consent decree before proceeding with the transaction. "

This was interesting part of the report related to dealing with new acquisitions:

"To address this concern, Subcommittee staff recommends that Congress consider shifting presumptions for future acquisitions by the dominant platforms. Under this change, any acquisition by a dominant platform would be presumed anticompetitive unless the merging parties could show that the transaction was necessary for serving the public interest and that similar benefits could not be achieved through internal growth and expansion. This process would occur outside the current HartScott-Rodino Act (HSR) process, such that the dominant platforms would be required to report all transactions and no HSR deadlines would be triggered. Establishing this presumption would better reflect Congress’s preference for growth through ingenuity and investment rather than through acquisition."

 

[iFan]

When reporting on political issues, more context should be provided on who published this report. Since the House has a democrat majority - this is a democrat-led committee that has published this. The article should make this clear. If the house were to change hands in a month, the entire report would be thrown out. The republicans also have issues with big tech, but seem to want different changes made.

 

[vipergts2207]

Ahh, the semantics to the rescue 😄 fair enough.
Let me clarify your argument so I understand it: blackberry failed to adapt and so it failed. Apple has not failed in adapting and has been successful. Therefore you're arguing that businesses that don't fail to adapt and reap the rewards are therefore deserving of the government regulating them?

If those rewards are at the detriment of consumers and other companies then yes. Surely you agree Blackberry would rather be in Apple's position of looking down the barrel of a few regulations than its current position as a failed company? Success isn't a blank check to do as you please. Why do some people think tech companies should be exempt from monopoly and anti-trust laws and regulations? I like Apple as much as anyone else here, but I recognize that two much power concentrated has negative consequences.

 

[lenard]

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

And Apple has no obligation to open up their platform just, because developers have become greedy. This will cause more harm to the ecosystem than good.

And I would never load an app on my devices from a third party App Store...

 

[rjohnstone]

Only in the U.S. does iOS have a slight lead over Android. In the rest of the world, Android dominates. There is just no way to claim Apple can illegally use monopoly power when it has 52% share in the U.S.

You're assuming Congress is using that as a benchmark... hint, they aren't.
Apple has 100% control over the Apple devices and the iOS app market.
All iOS developers live and die at the pleasure of Apple. All hardware developers that want to be certified to work with Apple products must meet Appl's requirements, and even if you do meet them, Apple can still deny certification for any reason.
Seriously read the report.

 

[[AUT] Thomas]

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

I wonder if people like you ever reflect their own point of view...

Capitalism is based on competition. Always was. It's fundamental to democracy and freedom.
Using the open market to create a closed market isn't really how things are supposed to work. Look at literally every product around you. The ONLY exception to this is software where trying to lock in users has become common practice that has been tolerated way too long.
If people like you would be in charge we wouldn't even have affordable spare parts for cars because "every part has been designed by the manufacturer and is their intelectual property and 3rd party parts would violate said intelectual property."
Surprise: just because you sell the car, doesn't mean you have admin rights over it for the rest of its lifetime.
Yet, exactly that is the case on the software side of "tech".
The licensing models and EULA's have come the a point where regulation is unavoidable.
Most tech companies aren't even compliant with WTO standards (altering a product/sales agreement after purchase to an extent that might render the product useless) and all that is justified with licensing agreements and T&Cs which can be altered at the sole discretion of the seller, pardon, "service-provider".
Regulation & law-making in those corners of the economy is long overdue.

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

lol I seriously doubt the government will allow Apple to not comply with the law...

 

[vipergts2207]

Only in the U.S. does iOS have a slight lead over Android. In the rest of the world, Android dominates. There is just no way to claim Apple can illegally use monopoly power when it has 52% share in the U.S.

Laws pertaining to monopolies don't only apply to true monopolies. If Apple uses it's position in the market to unfairly impact consumers or other companies, they can still get whacked for it.

 

[JM]

My argument is that a consumer should be allowed to install whatever software they want on hardware that they own. And those "reasons" have the effect of being anti-competitive, which is a no-no, especially if you're one half of a duopoly. I don't think Apple originally walled off the iPhone from outside apps for money, but that absolutely is a primary reason for maintaining that wall.

In both cases a contributing factor is simple inertia. From the early days of computing and PCs, a walled off garden wasn't a thing. When it came to the iPhone though, especially early on, a walled off app store kind of made sense. It wasn't conceived as a truly stand-alone device as it exists nowadays. It depended on a connected computer for a lot of things, even OS updates. Not being a standalone device meant that they needed an easy way to get apps onto the phone and an app store was an easy way to do that. And Apple giving developers the tools to get their software into the app store meant there would be lots of apps and quickly. At some point though the app store became extremely profitable for Apple and is a primary driver for keeping it that way. No doubt Apple should continue to benefit form the tools they created, but clearly the status quo is far too favorable to Apple.

There's a lot of things to respond to in there 😄 thanks for the history lesson

I agree that people should be able to install whatever they want on their devices. But I also appreciate Apple's lockdown control because it has created a device that I can depend on, where the quality is high. So, while I think people should install whatever they want, I think it's more important that Apple has made choices that ensure quality products.

As for making money, should companies not make profits within the law? Which is where the anti-competitive argument comes in... and we disagree about Apple's behavior.

What isn't fair is telling Apple that they are making too MUCH money from their business and no sorry the government needs some of that thank you.

The tools are only favorable to Apple because Apple made it so. They made an EXTREMELY profitable company starting with doing things extremely well: software, hardware, customer service. Why punish them when they continue to ensure that the business stays alive?

 

[rp2011]

I’m sure Facebook and Microsoft and others promised to fund campaigns if the went after Apple. Facebook doesn't like the new privacy features whatsoever.

 

[I7guy]

If you read the whole report, you will see it is defined as such.
The question from the committee is do you split the company or enforce business unit separation.
Meaning App Store side can no longer share app info with Apple's in house development team and actually apply Apple's API rules to Apple in house apps as well.

That doesn’t mean anything will change. We’ll have to wait and see. The days of breaking up companies , like AT&T (the benchmark of monopoly), should be over.

 

[rjohnstone]

That doesn’t mean anything will change. We’ll have to wait and see.

Most likely have to see what the next Congress will look like.
If Dems hold the House and take the Senate, I could see stricter laws being passed.
Otherwise, yeah... I don't see it going anywhere anytime soon.

 

[I7guy]

I wonder if people like you ever reflect their own point of view...

Capitalism is based on competition. Always was. It's fundamental to democracy and freedom.
Using the open market to create a closed market isn't really how things are supposed to work. Look at literally every product around you. The ONLY exception to this is software where trying to lock in users has become common practice that has been tolerated way too long.
If people like you would be in charge we wouldn't even have affordable spare parts for cars because "every part has been designed by the manufacturer and is their intelectual property and 3rd party parts would violate said intelectual property."
Surprise: just because you sell the car, doesn't mean you have admin rights over it for the rest of its lifetime.
Yet, exactly that is the case on the software side of "tech".
The licensing models and EULA's have come the a point where regulation is unavoidable.
Most tech companies aren't even compliant with WTO standards (altering a product/sales agreement after purchase to an extent that might render the product useless) and all that is justified with licensing agreements and T&Cs which can be altered at the sole discretion of the seller, pardon, "service-provider".
Regulation & law-making in those corners of the economy is long overdue.

lol I seriously doubt the government will allow Apple to not comply with the law...

Sounds like an anti-innovation post. A company can work hard, grow and innovate all through legal practices only to be regulated out of existence due to government interference because they did a great job. Government regulating lawful success.

 

[squirrellydw]

Nothing will change for at least 5 years.

 

[Sharewaredemon]

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?

Your comment is the most realistic prediction of the outcome I have seen. Thank you for taking the time to share it.

 

[The Phazer]

The App Store is cancer to Apple. The company will be better off when regulators inevitably kill it, and so will consumers.

 

[grad]

It is hard to believe that Oil Barons and Railroad Tycoons were as evil as these tech companies. But where the hell is Microsoft ?

 

[Unregistered 4U]

Well, developers just better get ready. You think it is hard to get into the App Store now, wait until there isn't one.

And, you can see where Apple’s already headed in this direction. Apple Arcade is Apple working with developers to create games that Apple publishes under the Apple Arcade banner. If they have to shut down general access to the App store, there’s nothing preventing them from still having Apple Arcade available. And, if it’s needed, maybe Apple Productivity, BUT maybe they’ll just keep it to games.

I’m 100% sure that one or another of the Android platforms will be more than happy to have all those developers making the apps for them!

 

[Zoboomafoo]

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

well I for one miss version tracker.com lol

 

[Zoboomafoo]

Is this actually a window into government gaining access to users devices? If we have to be able to transfer to competing services, doesn’t this amount to ending encryption practices?

 

[quagmire]

All Apple should be allowed to do is what they sell to the public to that they do with the App Store: Review apps to make sure there is no malicious code in them and make sure they follow reasonable rules( no data mining, trying to hide access to the camera, etc etc) and take a reasonable cut for the infrastructure they setup.

What Apple has been doing is doing what Google did with Chrome, they see what features are popular in the apps, they incorporate them into the OS itself, change the rules a bit, and now the competing apps are removed for "rule violations".

If Apple allowed apps that competed against their own built in features and did more what they sell the public on what they do, didn't cut Amazon, etc special lower cuts, and other unsavory actions, the case would be considerably weaker. But the House report does have a decent case against Apple that they misused their position.

Note: I don't support Epic in their fight against Apple at the same time.

 

[macfacts]

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 defined a market, you’re no longer defining a market, your defining a company’s product.

These iOS apps aren't made by apple, only a very very small number of iOS apps are made by apple.