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Apple’s defense of the App Store just shows how hard it is to compete with Apple

75 points by jmsflknr 7y ago

woodgrainz 7y ago
Apple's market share is low enough that it may continue to be unchallenged by enforcing all its own apps to be the default apps. Antitrust will probably not apply to them, I suspect.
- MBCook 7y ago
  The US government (for example) doesn’t care about Apple’s world wide market share, they care about the US. And in the US Apple’s market share is MUCH higher.
  - dep_b 7y ago
    Not even close to anti-trust triggering size though
  - Retric 7y ago
    Still 10% below Android though.
    - writepub 7y ago
      Not according to [1]. Install base of iOS is higher in the US [1]: http://gs.statcounter.com/os-market-share/mobile/united-states-of-america http://gs.statcounter.com/os-market-share/mobile/united-stat...
- runevault 7y ago
  This gets into an interesting consideration around what monopoly means. Up until now it's always been about market share, but the interesting trick apple has pulled is, while not having a great chunk of the market, they DO have a massive chunk of mobile app revenue, hence mobile devs so focused on iOS in spite of total available user base relative to Android.
- mcphage 7y ago
  I am not a lawyer by any stretch, but I remember from conversations here recently about anti-trust, is that it all depends on how the "market" is defined. Apple has a non-monopoly share of the smartphone market, or even the app market, but they do have a monopoly share of the iPhone market. Sometimes, that's the relevant metric.
  - zepto 7y ago
    By that logic, any manufacturer who doesn’t produce a commodity is automatically a monopolist.
    - hrktb 7y ago
      The metrics might be how far they are using their weight to one-up competition within their ecosystem. The same point has been raised with Amazon using its platform wide vision to see market trends and enter profitable niches with its own brand. There’s an effort to redefine anti-competitive behaviors within a platform, it might end up being called something else than anti-trust, but it’s a real effort.
    - damnyou 7y ago
      Not just any arbitrary one, but certainly one that is big enough is a monopolist. This seems obviously true to me. The big insight from Lina Khan's work is that harm to consumer welfare is sufficient but not necessary for an entity to be a monopoly. Bigness itself is a problem for society.
      - zepto 7y ago
        What’s the definition of bigness in this work?
        damnyou 7y ago
        There are debates to be had at the borders, but FAANG are clearly on the wrong side of it.
- bearjaws 7y ago
  If Microsoft defaulting IE8 can result in a antitrust lawsuit, I believe we will see the same applied here when it comes to assistants, google maps, browsers and such.
adgasf 7y ago
Apple needs to allow you to change the default apps (similar to how you can change the keyboard) for this argument to hold up.
- mcphage 7y ago
  Also allow apps to allow purchases inside without going through Apple's in-app purchases. Maybe they need to decide on a case-by-case basis, or maybe only for apps for companies with a large external presence, but not being able to buy eBooks through the Kindle app, because Apple wants it to go through their own in-app purchases instead of Amazon's own payment gateway, is frustrating.
  - zepto 7y ago
    If they allow enough In app purchases not to go through the store then they have no way to collect money from anyone, Since all apps could then just collect their money that way. If you limit it only to an anointed group of large companies then you have formed a cartel, which itself is likely illegal.
    - balabaster 7y ago
      They could do something like Microsoft has with Azure where you have an Enterprise Agreement whereby you pay some licensing fee and then they allow companies to route through their own payment gateways to make for a better user experience. People say Apple care about the user, but they don't, they care only insofar as ensuring lock in. They don't care if you hate Apple, just so long as you keep giving them your money. As long as you don't hate them enough to leave, they've done enough. The only way to fix it is if enough companies make their user experience so much better on Android that having an Android device is a more attractive offering than an Apple one and enough users flee Apple for alternatives... but companies don't give a shit if you want Android or Apple, what they care about is how much they have to pay developers to win your money and your eyeballs on their products. I've worked on a number of high value development teams for these types of apps across mobile platforms and this attitude has been common across all of them: If they can still win your money through a crippled user experience that it costs them a minimal amount to maintain across both platforms, that's what they do. They want Apple's market. They want Android's market. They don't want to maintain two applications and two development teams because that increases costs and they want similar user experiences on each device because brand fragmentation hurts their image. So in this sense Apple is also hurting Android and it's evidence they don't really give much of a fuck about the user as long as they're getting your money. I say this as someone who has experience on the inside of development teams that provide the apps you love on the devices you love, and I say this as someone who loves my Apple devices but am by no means an iFanboy.
pwinnski 7y ago
> The message here seems to be that if companies don’t like Apple’s policies, they’ve got other options. Go find your riches on Android or make a Roku app. But developers have a huge financial incentive to be in the App Store. It’s often been reported that iOS users spend more money on apps than people with Android phones, and Apple leans on that advantage. Apple's argument would seem to be that this financial incentive is the direct result of their policies, so forcing them to change those policies would reduce or eliminate this financial incentive. It's a reasonable argument, although I think it's unknowable whether it's true. Legally, it might not matter.
- wayoutthere 7y ago
  I tend to agree with this argument, and here’s why: Apple’s brand across the board is about controlling every aspect of the user experience so they can make it a cohesive experience the user enjoys. They do this at the expense of short-term monetary gains from things like advertising, and don’t give a damn about making life difficult for their business partners. This is not the result of their success but likely the reason for it. There’s a reason it was so culturally difficult for them to license “clone” Mac hardware in the 1990s; it’s just not in their DNA. They understand that the end user relationship is all that matters. For Apple’s brand to succeed, they have to own the relationship entirely so they can protect their users from bad actors. That is literally why a large segment of people choose Apple products. Do iPhones have malware problems on the scale of Android? No, because of Apple’s heavy-handed control of the App Store. I honestly think Apple would shut down the App Store entirely in favor of something more universal like WASM before ceding control of the user experience. General platform security / privacy also benefit from this approach.
  - bitpush 7y ago
    Are we justifying potentially illegal behavior by saying "that's their brand" and it helps them get wealthy in the long run? Monsanto does the same with seeds. They do RnD, develop seeds and force farmers to buy seeds directly from them, control end to end and probably produce higher-yield crops with lesser diseases. It is their "brand" but should we justify that behavior?
alienreborn 7y ago
Relevant article by former App Approval Chief at Apple: https://medium.com/@phillipshoemaker/apple-v-everybody-5903039e3be https://medium.com/@phillipshoemaker/apple-v-everybody-59030...
- danShumway 7y ago
  From the article: > Target, for example, is a standard, old-school brick and mortar shop. You go to find specific products and walk up and down aisles. When you find something that interests you, you don’t purchase it through that product. Instead you bring it to the Target checkout clerk, and they will charge you for it. And believe me, Target gets their fair share of the purchase of that item. If Target finds that the product has stickers telling you to purchase this item from Amazon or another location for a lesser amount, Target will remove the item from the shelves, and rightfully so. It is their brand that is bringing in the customers, not the products. It seems at first glance like this would largely contradict Apple's earlier arguments that purchases are between app developers and consumers, and that it's just an intermediary in the process[0]. Anyone willing to comment about a subtlety to this argument I could be missing? [0]: https://www.mercurynews.com/2019/05/13/apple-app-store-lawsuit-can-proceed-supreme-court-rules/ https://www.mercurynews.com/2019/05/13/apple-app-store-lawsu...
  - tguedes 7y ago
    I don't believe it contradicts it. Apple claims that it does not set the price, the developers do. That's what they mean when they are just the intermediary, they facilitate the transaction but are not part of it. I think his example is poor because Target does set the prices on products, for the most part. I think something better would be a flee market. The flee market operators provide services to facilitate the sales of the vendors and they can also choose which vendors are allowed to sell in their market, but they do not control the prices the vendors sell at.
    - bilbo0s 7y ago
      Just as a point of precision, Target does not technically set the price of any given manufacturer's goods. What they do when you get to that point in your talks with them, (and only if you're not ginormous), is to strongly suggest that you sell your product at such and such price. If you don't, they're gonna walk and sign on your competitor instead. It's devilishly ingenious, because, as I found out the hard way, in a court of law, they don't consider that to be setting the price. You still have the power to set your own price. You just won't be in Target if you pick the wrong price.
just_myles 7y ago
" (Apple takes a 30 percent cut of subscriptions for the first year a customer is signed up and 15 percent for each year thereafter." That is a considerable amount of paper.. How do you make any money when their cut is so high? Anybody with experience? I wonder how this shakes out annually with an app like Netflix.
- pwinnski 7y ago
  Netflix doesn't give up 30% or 15%. It's listed as an example of a "Reader" app, so Netflix subscriptions take place entirely outside of Apple's infrastructure[0] and therefore Apple get zero of that money. > How do you make any money... The remaining 70%/85% is a pretty good start. As they say before that point, "developers have earned more than $120 billion worldwide" [0] The point Apple glosses over here is that Netflix isn't even allowed to provide a link back to their site for subscribing within the app, which seems difficult to defend.
  - just_myles 7y ago
    Fair enough. Still a rather large margin. More to the article's/ your point, not being able to provide a link back to your app is kind of kind of anti-competitive. They want you to subscribe using their own systems.
  - pkamb 7y ago
    Netflix only recently removed in-app subscriptions; before that they were paying X% to Apple for every subscriber who paid via iTunes. And still are for anyone who is still paying that way. Although surely it was a sweetheart deal always below 30%, and potentially below the 15%.
  - xvector 7y ago
    > The point Apple glosses over here is that Netflix isn't even allowed to provide a link back to their site for subscribing within the app, which seems difficult to defend. How is it difficult to defend? If I am selling my product in a Target, I am not allowed to put stickers all over it telling people to buy it from Amazon instead. No reasonable storefront would allow this, really.
ppeetteerr 7y ago
What a joke! Apple made a product people enjoy using and an App Store people trust. Now, companies are complaining that Apple is stifling innovation because their App Store is charging 30% and making competitive products. Tough shit. It's their walled garden. Don't build for the App Store if you're afraid of competition.
pier25 7y ago
It's funny that Apple shows competing alternatives to Safari on iOS when in fact all iOS browsers use the same engine. https://www.apple.com/ios/app-store/principles-practices/ https://www.apple.com/ios/app-store/principles-practices/
stcredzero 7y ago
But the most interesting parts of this new site relate to competition. In one section, Apple goes over the core, built-in apps on iOS and lists the many popular third-party options that are available from the App Store in each category as alternatives. I dare someone to try it. Take all of the default apps and hide them away in a folder somewhere and replace all of them with alternatives. Let me know 1) the quality of your user experience and 2) of all of the annoyances, how many of them are due to the lack of "special" capabilities and integration only available to the in-house apps?
anfilt 7y ago
2 things I really hope from this. Apple can no longer block side-loading, and the dumb restriction on browser engines goes away, but I guess I will see how this law suite goes. Also It's hilarious how they claim it's competitive. You can only install one app store.
singularity2001 7y ago
I had three apps denied because they where 'too close to existing Apple products'. (They where not). Break that monopoly!
Ourotica 7y ago
If you think it's tough dealing with Apple, try running an app that allows adult content. We're not allowed in the app store, we're not welcome on any major payment platform, and thanks to Apple dragging their heels on PWA support in Safari, we don't have any access to push notifications (or most of the other major native features). The vast majority of our traffic is on iOS, but we're completely locked out from providing a native experience thanks to Apple's bullshit policies.
- ppeetteerr 7y ago
  The policies are everywhere https://www.theverge.com/2019/5/29/18644537/google-marijuana-android-play-store-policy-ban-direct-sales-facilitation-apps https://www.theverge.com/2019/5/29/18644537/google-marijuana...

75 points by jmsflknr 7y ago

Apple's market share is low enough that it may continue to be unchallenged by enforcing all its own apps to be the default apps. Antitrust will probably not apply to them, I suspect.

MBCook 7y ago
The US government (for example) doesn’t care about Apple’s world wide market share, they care about the US. And in the US Apple’s market share is MUCH higher.
- dep_b 7y ago
  Not even close to anti-trust triggering size though
- Retric 7y ago
  Still 10% below Android though.
  - writepub 7y ago
    Not according to [1]. Install base of iOS is higher in the US [1]: http://gs.statcounter.com/os-market-share/mobile/united-states-of-america http://gs.statcounter.com/os-market-share/mobile/united-stat...
runevault 7y ago
This gets into an interesting consideration around what monopoly means. Up until now it's always been about market share, but the interesting trick apple has pulled is, while not having a great chunk of the market, they DO have a massive chunk of mobile app revenue, hence mobile devs so focused on iOS in spite of total available user base relative to Android.
mcphage 7y ago
I am not a lawyer by any stretch, but I remember from conversations here recently about anti-trust, is that it all depends on how the "market" is defined. Apple has a non-monopoly share of the smartphone market, or even the app market, but they do have a monopoly share of the iPhone market. Sometimes, that's the relevant metric.
- zepto 7y ago
  By that logic, any manufacturer who doesn’t produce a commodity is automatically a monopolist.
  - hrktb 7y ago
    The metrics might be how far they are using their weight to one-up competition within their ecosystem. The same point has been raised with Amazon using its platform wide vision to see market trends and enter profitable niches with its own brand. There’s an effort to redefine anti-competitive behaviors within a platform, it might end up being called something else than anti-trust, but it’s a real effort.
  - damnyou 7y ago
    Not just any arbitrary one, but certainly one that is big enough is a monopolist. This seems obviously true to me. The big insight from Lina Khan's work is that harm to consumer welfare is sufficient but not necessary for an entity to be a monopoly. Bigness itself is a problem for society.
    - zepto 7y ago
      What’s the definition of bigness in this work?
      - damnyou 7y ago
        There are debates to be had at the borders, but FAANG are clearly on the wrong side of it.
bearjaws 7y ago
If Microsoft defaulting IE8 can result in a antitrust lawsuit, I believe we will see the same applied here when it comes to assistants, google maps, browsers and such.

adgasf 7y ago

Apple needs to allow you to change the default apps (similar to how you can change the keyboard) for this argument to hold up.

mcphage 7y ago
Also allow apps to allow purchases inside without going through Apple's in-app purchases. Maybe they need to decide on a case-by-case basis, or maybe only for apps for companies with a large external presence, but not being able to buy eBooks through the Kindle app, because Apple wants it to go through their own in-app purchases instead of Amazon's own payment gateway, is frustrating.
- zepto 7y ago
  If they allow enough In app purchases not to go through the store then they have no way to collect money from anyone, Since all apps could then just collect their money that way. If you limit it only to an anointed group of large companies then you have formed a cartel, which itself is likely illegal.
  - balabaster 7y ago
    They could do something like Microsoft has with Azure where you have an Enterprise Agreement whereby you pay some licensing fee and then they allow companies to route through their own payment gateways to make for a better user experience. People say Apple care about the user, but they don't, they care only insofar as ensuring lock in. They don't care if you hate Apple, just so long as you keep giving them your money. As long as you don't hate them enough to leave, they've done enough. The only way to fix it is if enough companies make their user experience so much better on Android that having an Android device is a more attractive offering than an Apple one and enough users flee Apple for alternatives... but companies don't give a shit if you want Android or Apple, what they care about is how much they have to pay developers to win your money and your eyeballs on their products. I've worked on a number of high value development teams for these types of apps across mobile platforms and this attitude has been common across all of them: If they can still win your money through a crippled user experience that it costs them a minimal amount to maintain across both platforms, that's what they do. They want Apple's market. They want Android's market. They don't want to maintain two applications and two development teams because that increases costs and they want similar user experiences on each device because brand fragmentation hurts their image. So in this sense Apple is also hurting Android and it's evidence they don't really give much of a fuck about the user as long as they're getting your money. I say this as someone who has experience on the inside of development teams that provide the apps you love on the devices you love, and I say this as someone who loves my Apple devices but am by no means an iFanboy.

pwinnski 7y ago

> The message here seems to be that if companies don’t like Apple’s policies, they’ve got other options. Go find your riches on Android or make a Roku app. But developers have a huge financial incentive to be in the App Store. It’s often been reported that iOS users spend more money on apps than people with Android phones, and Apple leans on that advantage. Apple's argument would seem to be that this financial incentive is the direct result of their policies, so forcing them to change those policies would reduce or eliminate this financial incentive. It's a reasonable argument, although I think it's unknowable whether it's true. Legally, it might not matter.

wayoutthere 7y ago
I tend to agree with this argument, and here’s why: Apple’s brand across the board is about controlling every aspect of the user experience so they can make it a cohesive experience the user enjoys. They do this at the expense of short-term monetary gains from things like advertising, and don’t give a damn about making life difficult for their business partners. This is not the result of their success but likely the reason for it. There’s a reason it was so culturally difficult for them to license “clone” Mac hardware in the 1990s; it’s just not in their DNA. They understand that the end user relationship is all that matters. For Apple’s brand to succeed, they have to own the relationship entirely so they can protect their users from bad actors. That is literally why a large segment of people choose Apple products. Do iPhones have malware problems on the scale of Android? No, because of Apple’s heavy-handed control of the App Store. I honestly think Apple would shut down the App Store entirely in favor of something more universal like WASM before ceding control of the user experience. General platform security / privacy also benefit from this approach.
- bitpush 7y ago
  Are we justifying potentially illegal behavior by saying "that's their brand" and it helps them get wealthy in the long run? Monsanto does the same with seeds. They do RnD, develop seeds and force farmers to buy seeds directly from them, control end to end and probably produce higher-yield crops with lesser diseases. It is their "brand" but should we justify that behavior?

alienreborn 7y ago

Relevant article by former App Approval Chief at Apple: https://medium.com/@phillipshoemaker/apple-v-everybody-5903039e3be https://medium.com/@phillipshoemaker/apple-v-everybody-59030...

danShumway 7y ago
From the article: > Target, for example, is a standard, old-school brick and mortar shop. You go to find specific products and walk up and down aisles. When you find something that interests you, you don’t purchase it through that product. Instead you bring it to the Target checkout clerk, and they will charge you for it. And believe me, Target gets their fair share of the purchase of that item. If Target finds that the product has stickers telling you to purchase this item from Amazon or another location for a lesser amount, Target will remove the item from the shelves, and rightfully so. It is their brand that is bringing in the customers, not the products. It seems at first glance like this would largely contradict Apple's earlier arguments that purchases are between app developers and consumers, and that it's just an intermediary in the process[0]. Anyone willing to comment about a subtlety to this argument I could be missing? [0]: https://www.mercurynews.com/2019/05/13/apple-app-store-lawsuit-can-proceed-supreme-court-rules/ https://www.mercurynews.com/2019/05/13/apple-app-store-lawsu...
- tguedes 7y ago
  I don't believe it contradicts it. Apple claims that it does not set the price, the developers do. That's what they mean when they are just the intermediary, they facilitate the transaction but are not part of it. I think his example is poor because Target does set the prices on products, for the most part. I think something better would be a flee market. The flee market operators provide services to facilitate the sales of the vendors and they can also choose which vendors are allowed to sell in their market, but they do not control the prices the vendors sell at.
  - bilbo0s 7y ago
    Just as a point of precision, Target does not technically set the price of any given manufacturer's goods. What they do when you get to that point in your talks with them, (and only if you're not ginormous), is to strongly suggest that you sell your product at such and such price. If you don't, they're gonna walk and sign on your competitor instead. It's devilishly ingenious, because, as I found out the hard way, in a court of law, they don't consider that to be setting the price. You still have the power to set your own price. You just won't be in Target if you pick the wrong price.

just_myles 7y ago

" (Apple takes a 30 percent cut of subscriptions for the first year a customer is signed up and 15 percent for each year thereafter." That is a considerable amount of paper.. How do you make any money when their cut is so high? Anybody with experience? I wonder how this shakes out annually with an app like Netflix.

pwinnski 7y ago
Netflix doesn't give up 30% or 15%. It's listed as an example of a "Reader" app, so Netflix subscriptions take place entirely outside of Apple's infrastructure[0] and therefore Apple get zero of that money. > How do you make any money... The remaining 70%/85% is a pretty good start. As they say before that point, "developers have earned more than $120 billion worldwide" [0] The point Apple glosses over here is that Netflix isn't even allowed to provide a link back to their site for subscribing within the app, which seems difficult to defend.
- just_myles 7y ago
  Fair enough. Still a rather large margin. More to the article's/ your point, not being able to provide a link back to your app is kind of kind of anti-competitive. They want you to subscribe using their own systems.
- pkamb 7y ago
  Netflix only recently removed in-app subscriptions; before that they were paying X% to Apple for every subscriber who paid via iTunes. And still are for anyone who is still paying that way. Although surely it was a sweetheart deal always below 30%, and potentially below the 15%.
- xvector 7y ago
  > The point Apple glosses over here is that Netflix isn't even allowed to provide a link back to their site for subscribing within the app, which seems difficult to defend. How is it difficult to defend? If I am selling my product in a Target, I am not allowed to put stickers all over it telling people to buy it from Amazon instead. No reasonable storefront would allow this, really.

ppeetteerr 7y ago

What a joke! Apple made a product people enjoy using and an App Store people trust. Now, companies are complaining that Apple is stifling innovation because their App Store is charging 30% and making competitive products. Tough shit. It's their walled garden. Don't build for the App Store if you're afraid of competition.

pier25 7y ago

It's funny that Apple shows competing alternatives to Safari on iOS when in fact all iOS browsers use the same engine. https://www.apple.com/ios/app-store/principles-practices/ https://www.apple.com/ios/app-store/principles-practices/

stcredzero 7y ago

But the most interesting parts of this new site relate to competition. In one section, Apple goes over the core, built-in apps on iOS and lists the many popular third-party options that are available from the App Store in each category as alternatives. I dare someone to try it. Take all of the default apps and hide them away in a folder somewhere and replace all of them with alternatives. Let me know 1) the quality of your user experience and 2) of all of the annoyances, how many of them are due to the lack of "special" capabilities and integration only available to the in-house apps?

anfilt 7y ago

2 things I really hope from this. Apple can no longer block side-loading, and the dumb restriction on browser engines goes away, but I guess I will see how this law suite goes. Also It's hilarious how they claim it's competitive. You can only install one app store.

singularity2001 7y ago

I had three apps denied because they where 'too close to existing Apple products'. (They where not). Break that monopoly!

Ourotica 7y ago

If you think it's tough dealing with Apple, try running an app that allows adult content. We're not allowed in the app store, we're not welcome on any major payment platform, and thanks to Apple dragging their heels on PWA support in Safari, we don't have any access to push notifications (or most of the other major native features). The vast majority of our traffic is on iOS, but we're completely locked out from providing a native experience thanks to Apple's bullshit policies.

ppeetteerr 7y ago
The policies are everywhere https://www.theverge.com/2019/5/29/18644537/google-marijuana-android-play-store-policy-ban-direct-sales-facilitation-apps https://www.theverge.com/2019/5/29/18644537/google-marijuana...