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I upvoted your comments based on a good faith belief that you're open to learning more about how antitrust law works. It has little to do with market share, and

I upvoted your comments based on a good faith belief that you're open to learning more about how antitrust law works. It has little to do with market share, and everything to do with a concept called "market power." Market power is the ability to coerce people into paying more for something via a mechanism other than actually offering a better product or service. A textbook example which most people would agree is bad is a trust/cartel situation where a few players artificially limit supply, and then can raise the price on consumers because there are no competitors. But if a firm is able to drive up prices with impunity for any reason, it's likely they possess market power. When a firm possesses excess market power it's good for that firm, but bad for the market, consumers, and society. By definition a firm with a lot of market power has very little competition, so even as their margins grow, product quality will decline and price will increase. (Sound like Apple in 2020?) And new firms will find it difficult to compete in that market even as the firm with market power grows very rich, which exacerbates the problem of wealth inequality. (Sound like America in 2020?) A society which doesn't place some sort of checks on a firm's ability to acquire market power ends up being a place where the way to get ahead is to find an unfair advantage, abuse it, and screw everyone else. (Again, sound familiar?) At this point it's almost certain that Google is violating antitrust regulation by abusing its market power (proven in the EU, and the US looks poised to start filing lawsuits this year). Apple, Amazon and a few others are up for debate and it's also fair to say that antitrust regulations should evolve to address the tech industry more effectively. The antitrust problem isn't limited to tech however, anti-competitive behaviors of questionable legality have proliferated all over the US since the 80s due to a lax regulatory environment. If you want to learn more about this topic, Matt Stoller's newsletter "BIG" on Substack is a phenomenal place to start.

scarface74 6y ago
A textbook example which most people would agree is bad is a trust/cartel situation where a few players artificially limit supply, and then can raise the price on consumers because there are no competitors. A cartel implies collusion and unless you have evidence that Apple is colluding with Google and all of the console makers this is irrelevant. But if a firm is able to drive up prices with impunity for any reason, it's likely they possess market power. Every company that has a differentiate product is able to charge more than commodity prices. Nike is able to charge more shoes. Apple is able to charge more for the AppleTV than Roku. Does Apple now have a “monopoly” on set top boxes even though it’s share is a nothing? Apple charges more for Macs than the equivalent PC. Should Apple also be investigated for having a “monopoly” on computers? The antitrust problem isn't limited to tech however, anti-competitive behaviors of questionable legality have proliferated all over the US since the 80s due to a lax regulatory environment. If that’s the case, where are all the lawsuits? HN users can’t imagine that they might not be legal experts.
- apatters 6y ago
  OK, from the last part of the comment there, you demonstrated that my good faith belief was wrong, so I'm not going to waste more time with you. Have fun stewing in your own juices. In your community of one you'll always be right.
  - scarface74 6y ago
    Yeah silly me for looking for relevant “precedents”. I’m going by your own definitions.
nodamage 6y ago
> Market power is the ability to coerce people into paying more for something via a mechanism other than actually offering a better product or service. How exactly does Apple "coerce people into paying more for their phones via a mechanism other than actually offering a better product or service", and what is that mechanism? > But if a firm is able to drive up prices with impunity for any reason, it's likely they possess market power. How is Apple actually able to "drive up prices with impunity for any reason"? It seems to me, the more Apple raises iPhone prices, the more people are priced out and decide to switch to a cheaper phone instead.
- commoner 6y ago
  The matter under contention is the pricing of in-app purchases, not the pricing of phones. By disallowing app stores other than Apple's App Store, Apple is coercing users to pay an inflated price for in-app purchases, since it takes a 42.8% price hike to negate Apple's 30% fee.
  - scarface74 6y ago
    So what’s the true value of those cool Carlton dance moves I can get on Fortnite? How much less would the coins and loot boxes cost? Just imagine the overhead that Epic has to charge to reproduce the $18 billion of virtual goods it sales.
    - commoner 6y ago
      This article is about WordPress, not Fortnite. For WordPress.com to cancel out Apple's 30% fee, its monthly prices for its paid plans would need to increase from $4 to $5.71, from $8 to $11.43, from $25 to $35.71, and from $45 to $64.29. https://wordpress.com/pricing/ https://wordpress.com/pricing/
  - nodamage 6y ago
    Both are relevant, because in order to successfully win an antitrust tying claim under US law you need to prove the seller had sufficient market power in a tying product in order to coerce buyers into buying the tied product. In this case, once you buy an iPhone, you're forced to use Apple's system to make in-app purchases. The tying product is the phone, and the tied product is the in-app purchase. So you need to show that Apple has sufficient market power in the smartphone market, and that is where the question of the ability to control prices of phones comes in.

scarface74 6y ago

A textbook example which most people would agree is bad is a trust/cartel situation where a few players artificially limit supply, and then can raise the price on consumers because there are no competitors. A cartel implies collusion and unless you have evidence that Apple is colluding with Google and all of the console makers this is irrelevant. But if a firm is able to drive up prices with impunity for any reason, it's likely they possess market power. Every company that has a differentiate product is able to charge more than commodity prices. Nike is able to charge more shoes. Apple is able to charge more for the AppleTV than Roku. Does Apple now have a “monopoly” on set top boxes even though it’s share is a nothing? Apple charges more for Macs than the equivalent PC. Should Apple also be investigated for having a “monopoly” on computers? The antitrust problem isn't limited to tech however, anti-competitive behaviors of questionable legality have proliferated all over the US since the 80s due to a lax regulatory environment. If that’s the case, where are all the lawsuits? HN users can’t imagine that they might not be legal experts.

apatters 6y ago
OK, from the last part of the comment there, you demonstrated that my good faith belief was wrong, so I'm not going to waste more time with you. Have fun stewing in your own juices. In your community of one you'll always be right.
- scarface74 6y ago
  Yeah silly me for looking for relevant “precedents”. I’m going by your own definitions.

nodamage 6y ago

> Market power is the ability to coerce people into paying more for something via a mechanism other than actually offering a better product or service. How exactly does Apple "coerce people into paying more for their phones via a mechanism other than actually offering a better product or service", and what is that mechanism? > But if a firm is able to drive up prices with impunity for any reason, it's likely they possess market power. How is Apple actually able to "drive up prices with impunity for any reason"? It seems to me, the more Apple raises iPhone prices, the more people are priced out and decide to switch to a cheaper phone instead.

commoner 6y ago
The matter under contention is the pricing of in-app purchases, not the pricing of phones. By disallowing app stores other than Apple's App Store, Apple is coercing users to pay an inflated price for in-app purchases, since it takes a 42.8% price hike to negate Apple's 30% fee.
- scarface74 6y ago
  So what’s the true value of those cool Carlton dance moves I can get on Fortnite? How much less would the coins and loot boxes cost? Just imagine the overhead that Epic has to charge to reproduce the $18 billion of virtual goods it sales.
  - commoner 6y ago
    This article is about WordPress, not Fortnite. For WordPress.com to cancel out Apple's 30% fee, its monthly prices for its paid plans would need to increase from $4 to $5.71, from $8 to $11.43, from $25 to $35.71, and from $45 to $64.29. https://wordpress.com/pricing/ https://wordpress.com/pricing/
- nodamage 6y ago
  Both are relevant, because in order to successfully win an antitrust tying claim under US law you need to prove the seller had sufficient market power in a tying product in order to coerce buyers into buying the tied product. In this case, once you buy an iPhone, you're forced to use Apple's system to make in-app purchases. The tying product is the phone, and the tied product is the in-app purchase. So you need to show that Apple has sufficient market power in the smartphone market, and that is where the question of the ability to control prices of phones comes in.