Comment by shuckles
2 years ago
Your list of services where you claim Apple has a dominant position is entirely products where it does not have a dominant position.
2 years ago
Your list of services where you claim Apple has a dominant position is entirely products where it does not have a dominant position.
It's not about having a dominant position, it's about using your power in one market to further your position in another one. Apple control iOS and macOS which is always bundled with the hardware, and they use that to strengthen their own applications. Competitors cannot do it as they do not have the same access that Apple does regarding APIs and other features.
Apple uses their own technology to make their products better. That’s not a scandal. Their products aren’t the most dominant in streaming, maps, or payment. Most of the complaints are about what they aren’t doing (going out of their way to make proprietary features available to 3ps), not what they are doing (say: giving themselves special push notification permissions). So what influence are they exerting exactly? Why is it so pernicious?
They're exerting the same influence that Google did over their Android partners. They created a faux-open market with arbitrary rules that ensure their products always win. Google lost their case because of this and Apple should too.
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The article and linked 90 page document outline precise answers to your questions
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Okay. But what happened to the Windows Phone and its integration with the Windows OS? It simply failed.
There is a valid argument to be made here against Apple and how their firm grip is stopping a market from advancing further. But not by using their technical success in creating a great platform.
It's all about economical fair play. If you create a market, but position yourself as the de-facto winner, it will not be a healthy one. It was all good, especially when default apps provided by Apple were free, but now with Apple Music, Apple TV, and iCloud being paid services, competitors worry about being not able to compete.
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> Your list of services where you claim Apple has a dominant position is entirely products where it does not have a dominant position.
I am not claiming that. I am claiming that Apple has a very dominant position over the most important sales channel lots of companies have to rely on to compete.
Just one example is the at this point famous App Store tax. From a 10$ Apple Music subscription, 9.8$ (lets use these cents for processing) goes to Apple.
For a 10$ Spotify subscription, Spotify makes 7$ after Apple takes their 30% fee. Sure one may say, hey, but Spotify isn't forced to use Apple's service for payments, except they are. Otherwise they loose access to *the* platform most people listen to their music nowadays. Spotify also isn't allow to make Apple subscriptions more expensive and inform users about cheaper subscriptions on their website, because otherwise they'd loose access to the important platform. I guess one can see how this could be considered a abuse of the dominant marked position?
Strictly speaking, for this example past tense would have been fitting. Not because Apple is so generous, but because the EU also considered much of this behavior to be anti-competitive. Hence me wondering if the US courts would be following this line of thinking.
What frustrates me the most is Apple's double dipping. They argue that those fees are required for the development of the platform and technology, pretending as if they didn't already charge a hefty price tag on the products they sell. And in the end, its still the user who is getting screwed. It's not like Spotify or any other provider is eating the platform cost, they charge it up to the user by making their services more expensive.
Also, in their defense in the EU hearings Apple argued that Spotify's success is in large part thanks to the App Store, so it would only be fair for them to pay that amount. The amount of arrogance in that statement is astonishing imho. Developing for a platform is a mutually beneficial relationship, not an altruistic development aid by Apple. What would iPhone sales look like if there was no third party Mail client, no Twitter app and no Instagram or Facebook for their phones?
TD;DR: easy demonstration of how Apple makes more money selling the same product, not because they're more efficient but because they make all the rules.
Your stylized example is unrelated to reality. Users cannot subscribe to Spotify in app, so Apple makes no money from them while providing all the R&D they use to play audio on the device for free. Next, people say that the hassle of subscribing to Spotify outside the app is an insurmountable friction for Spotify, yet somehow Spotify is the dominant streaming music provider.
So Apple has built all the key innovations which make mobile music streaming a viable product, gives it to the biggest music streaming service for free, and then gets slammed because it doesn’t also go out of its way to allow that service to integrate with Apple’s assistant AI product (except when it does build that functionality, the streaming service doesn’t even adopt it!).
Simply absurd logic.
> Users cannot subscribe to Spotify in app, so Apple makes no money from
They don’t? This is because of the limitation puts on the App. Apple Music users can easily subscribe thanks to Apple being not negatively affected by its own restrictions.
> while providing all the R&D they use to play audio on the device for free
So you’re saying the developers fees pay for their R&D. So am I with my phone purchase. So I’m simply paying twice. To quote yourself, that is
> Simply absurd logic.
> Apple has built all the key innovations which make mobile music streaming a viable product, gives it to the biggest music streaming service
Have they? Spotify was a thing on the desktop way before it was on iPhone. Apple didn’t invent mp3 and all sorts of other stuff. They built the platform for their phones, no more, no less.
> gives it to the biggest music streaming service for free
It’s not free, quite the opposite. It comes with a steep fee when you sell on their platform.
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> Your stylized example is unrelated to reality. Users cannot subscribe to Spotify in app, so Apple makes no money
And what do you think the reason for that is?
> while providing all the R&D they use to play audio on the device for free
Simply absurd logic. The device owner paid for their device and the OS. Apple already got their cash bag for it.
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This entire comment is wildly misinformed. Are you forgetting Apple charges like $1200 for a phone these days? They’re the most profitable company on the planet. Are you suggesting that in order to cover the extensive research and development costs of music playback (sorry did you really say this?), they need to take a 30% cut of every song played on the device?
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Totally agreed. And does Apple has a "dominant position" in text messaging? They have around 60% of total phone market share [1], but that seems like a far cry from, say, 80% or 90%, which is what I'd consider "dominant."
Microsoft had over 90% market share of the world's personal computers in the 1990s [2], which I'd also consider dominant... and which did result in some similar antitrust lawsuits.
1. https://explodingtopics.com/blog/iphone-android-users
2. https://en.wikipedia.org/wiki/History_of_Microsoft
Saying they don't have a monopoly over those services is still a stawman. They don't have a monopoly on music streaming, but they actively force Spotify to effectively support their own competitor via their 30% fee. Apple TV+ does not have more subscribers than Netflix, but apple famously makes rules that hinder Netflix ability to be competitive on iOS.
And if Apple was all about making the better product, why don't they allow the app developers to use their own payment processors. If Apple IAP was so superior to everything else, users and developers alike would surely gladly pay the 20x markup?
But heck, they don't even allow an App developer to tell their users about a cheaper price on their website or why the product is more expensive on iOS.
Wether you like it or not, as soon as a platform becomes as big as iOS or Android, market watchdogs will come to town. And that is good thing, because with competition the user usually profits over the long term.
Apple does not force Spotify to support its competition. Spotify does not offer any IAP so in fact it’s Apple that is giving away all its R&D into AVFoundation and various other cutting edge APIs for free to its competition. Apple does not make any money from Spotify.
It’s true when you become as successful as Apple, the rentiers will come knocking. That doesn’t make the rentiers’ case particularly strong or honorable.
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