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Apple is using their dominant (monopoly) position in mobile devices to shut down competitors in another industry (advertising) in order to drive growth in their
by avalys 4y ago
Apple is using their dominant (monopoly) position in mobile devices to shut down competitors in another industry (advertising) in order to drive growth in their own advertising platform, got it.
- macintux 4y agoUnder what definition of monopoly does Apple possess one? Even in their best market, the U.S., iPhone holds just a smidge over 50%.
- dragonwriter 4y ago> Under what definition of monopoly does Apple possess one? Market power is defined by pricing power (empirical absence of substitution effect), not share of some descriptive market (where you could always get any result you wanted just by changing the way you divide market descriptions.)
- celeritascelery 4y agoThat isn’t the definition of monopoly as stated by Wikipedia[1]: “a market with the "absence of competition", creating a situation where a specific person or enterprise is the only supplier of a particular thing.” I think calling them a monopoly is a real stretch. [1]https://en.wikipedia.org/wiki/Monopoly https://en.wikipedia.org/wiki/Monopoly
- Apocryphon 4y agoThat is how the FTC defines one. > Courts do not require a literal monopoly before applying rules for single firm conduct; that term is used as shorthand for a firm with significant and durable market power — that is, the long term ability to raise price or exclude competitors. That is how that term is used here: a "monopolist" is a firm with significant and durable market power. Courts look at the firm's market share, but typically do not find monopoly power if the firm (or a group of firms acting in concert) has less than 50 percent of the sales of a particular product or service within a certain geographic area. Some courts have required much higher percentages. In addition, that leading position must be sustainable over time: if competitive forces or the entry of new firms could discipline the conduct of the leading firm, courts are unlikely to find that the firm has lasting market power. > Obtaining a monopoly by superior products, innovation, or business acumen is legal; however, the same result achieved by exclusionary or predatory acts may raise antitrust concerns. https://www.ftc.gov/advice-guidance/competition-guidance/guide-antitrust-laws/single-firm-conduct/monopolization-defined https://www.ftc.gov/advice-guidance/competition-guidance/gui...
- bryanrasmussen 4y agook but you quote >Courts look at the firm's market share, but typically do not find monopoly power if the firm (or a group of firms acting in concert) has less than 50 percent of the sales of a particular product or service within a certain geographic area. Some courts have required much higher percentages. which seems to lend real credence to the argument that Apple would (most likely) not be understood as a monopoly in the courts. Sure it could happen, but lots of unlikely things can happen that still say won't happen because of how humans communicate.
- Apocryphon 4y agoIf there's anything that's an industry outlier, it's a FAANG, not to mention the most profitable company in the history of the world since the Dutch East India Company.
- heavyset_go 4y agoApple has 60% of the mobile OS market share in the US, and even more when it comes to mobile app distribution. Google has 40%, both in effect are a duopoly.
- dragonwriter 4y ago> which seems to lend real credence to the argument that Apple would (most likely) not be understood as a monopoly in the courts The issue isn't marketshare, the issue is defining the market within which marketshare is looked at. If you don't use some consistent objective defenition of market boundaries, you can pick or choose any result you want by how you describe the market applicable to any given case. While it isn’t perfect, “the space within which consumer substitution in response to changes like pricing occurs from the given good or service” is a rough description of what market boundary determination in US antitrust/competition law aims at. It's also, for obvious reasons, often the most contentious issue in antitrust cases, with a whole lot of market data thrown up by every interested party aimed at proving what the right market boundary is. If you just assume the boundary is some popular market description without interrogating whether consumer substitution for the given product really occurs across that whole descriptive market space (and, on the other side, only within that space), you are really just skipping over the most important question in antitrust.
- dragonwriter 4y ago> That isn’t the definition of monopoly as stated by Wikipedia[1]: “a market with the "absence of competition", It exactly is, if you further define “market” empirically by consumer behavior demonstrating products actually compete with each other rather than analytically based on some abstract comparison of features that make you think they should.
- xphos 4y agoI mean they are the only person who can legally provide adds and payment services on iPhones. Apple exhibits a huge amount of control over there platform in name of defending there customers but give little choice to the customer in how that's delivered
- scarface74 4y agoThere are plenty of third party ads in apps
- dwaite 4y agoThere are plenty of third party payment services.
- parkingrift 4y agoThat might be your definition, but it is absolutely not the definition used in legal proceedings to determine monopolistic behavior.
- smoldesu 4y agoCorrect, the legal interpretation of a monopoly is much more vague and open to interpretation.
- tshaddox 4y agoThen say market power instead of monopoly and no one will ever dispute that. Of course Apple can and does set the price of its products above their marginal cost. Doesn't have quite the ring to it as "monopoly" though.
- onepointsixC 4y agoThis is such banal point to make when Apple combined with Google have Duoloply. With Apple's advantage in App store spending Apple basically dictates whatever they want to App developers. So saying that they have monopoly like powers is completely and entirely correct.
- scarface74 4y agoFortunately, we have real lawyers and a real judge in the Epic vs Apple case that ruled that Apple is not a “monopoly”Z
- rchaud 4y agoThey don't allow alternative app stores. Android has several, I pretty much get all my apps via F-Droid for example.
- heartbreak 4y agoBuying an iPhone is like buying a Costco membership. The argument is that you buy the device for the app ecosystem. If you want a different app ecosystem, you buy a different device.
- goosedragons 4y agoBuying a Costco membership doesn't mean you can only shop at Costco though. If Wal-Mart has a better price on X or if Mom and Pop shop has item Y that Costco doesn't carry you can still buy them.
- tshaddox 4y agoAnd buying an iPhone doesn't mean you can't also buy an Android phone. The analogy you're looking for is that Costco does not indiscriminately allow all sellers to sell products at a Costco warehouse.
- pixl97 4y agoI mean, that is what Apple wants to sell you, but that's really no different than Ford saying "You have to buy Ford gas and tires because this is a Ford ecosystem", in which we've told the car companies to screw right off, though this is coming back with electric vehicles in a bad way.
- tshaddox 4y agoIs it different than video game consoles going to great lengths to prevent their hardware from running unauthorized software?
- 4y ago
- cma 4y agoThey have a clear monopoly in the high-end segment. "Intense competition" with Google has resulted in... few changes to app store cuts in 12+ years.
- eddieroger 4y agoMonopoly means lack of competition, not lack of consumer choice. High end consumers prefer Apple devices, but nothing stops them or anyone from going out to buy any Android device they want, or any PC they want.
- cma 4y agoSure there is, Apple has done the same kind of bundling Microsoft got busted for. Switch from Safari to Firefox on your desktop and now your browser won't sync tabs to your phone unless you use the fake webkit-in-sheeps-clothing version of Firefox that Apple has mandated and maintains insane control over (no real ad blockers, only limited ones).
- macintux 4y ago…when Microsoft held, what, a 90% market share?
- cma 4y agoWhat's Apple's dollar share of the market? The low end isn't as relevant on a per device level to the market.
- scarface74 4y agoDollar share? That’s not a definition of a monopoly.
- cma 4y agoDollar share of a market is 9ne measure of market share that can be used; and a large enough market can be split into segments when applying monopoly tests.
- Melatonic 4y agoThe monopoly is the app store on existing iphones and ipads - not the device itself. Once you buy something with iOS you are locked into their store.
- scarface74 4y agoSo in that case every company is a monopoly - Nintendo, Microsoft, Sony, Roku, Samsung smart TVs, Amazon Fire OS, etc. We just had a real judge say that definition is completely false in the Epic vs Apple case.
- Melatonic 4y agoYou can buy a used game from a separate company and throw it in your nintendo no problem. You can use a different app store on Android or sideload. The Epic case was not a total loss - I do not agree personally
- majormajor 4y agoHow many consoles will let you run games published without licensing enforced with code signing or such mechanisms? Bit harder to make an unlicensed game now than it used to be.
- scarface74 4y agoEvery game for every console since the original Nintendo has to be licensed by the console maker - even physical games.
- heisenbit 4y agoProfits. Apple has by far the lion share of profits and is able to leverage them to muscle into businesses. As iPhones are the premium devices one can reasonably argue Apple has a near monopoly of access to affluent eyeballs. Apple, please listen. These platform dreams of controlling supply, demand and the underlying tech platform are dangerous. Likely to fail or if you succeed it will run anti-trust problems. But your biggest risk is distraction. The shiny new kids on block wagging the core business to the detriment of customers and shareholders.
- jjtheblunt 4y agoprofits is a definition of monopoly ?
- deleted 4y ago[deleted]
- dwaite 4y agoTo my ears, I keep hearing people say that Apple has a monopoly on successful business execution in the tech space.
- deleted 4y ago[deleted]
- summerlight 4y agoWe have a good old fashioned concept of "relevant market". > A relevant product market comprises all those products and/or services which are regarded as interchangeable or substitutable by the consumer by reason of the products’ characteristics, their prices and their intended use. https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=LEGISSUM:l26073 https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=LEGISSUM... Are we able to substitute browser engine or app store in iOS? If not, then its app store itself can make of a single relevant market. This is so obvious to the level that even Apple knows they cannot avoid, so they're trying to make an argument that app store and browser engine are technically inseparable system service, not an interchangable product. (I strongly suspect that this is one of the reasons why we cannot get standard 4~6 weeks browser updates for Safari, decoupled from OS updates) EU doesn't seem to be very happy with that argument so they passed the Digital Market Act in response. And US is preparing a bipartisan bill similar to DMA as well. Yeah, I know the actual process for defining market is much more complicated but this is the basic idea. Antitrust investigation is a largely economical, data driven process and you cannot simply say "Even in their best market, the U.S., iPhone holds just a smidge over 50%". I won't assert they're in a monopolistic position, but many regulators (especially in EU) believe in that.
- deleted 4y ago[deleted]
- robbiep 4y agoIPhone is ~56% in australia. It’s 70% in Japan.
- thatguy0900 4y agoThe problem becomes when people buy the phone specifically because they hate the advertising industry, and Apple is the only player attempting to make the situation a little better.
- onepointsixC 4y agoBut they aren't. They're making it harder for other advertisers because they want their cut. Apple's Hide My Email was a perfect example. It builds barriers to tracking for third parties, while Apple themselves can still track you just fine. Apple makes everyone's tracking opt in, while theirs is opt out.
- dwaite 4y agoApple defines 'tracking' as cross-party. Apple (and Google) don't care as much about tracking as they put effort into building their own first-party relationship with you. Apple doesn't need to scrub the internet for information to show you ads in the App Store - they have your authenticated account where you have bought other apps. Similarly, Google doesn't need to build a clandestine profile for you if they have your Youtube and search history going back to when you created your gmail account. Google and Apple typically have little desire to share any of that information with third parties (in either direction). Without a need to implement third-party tracking, features like Hide My Email don't really affect them. However, thats not a privileged position in the operating system (Google doesn't really have such a position on iOS). Thats just a strong relationship with the person involved - something both companies have been establishing for decades. Both companies are also heavily invested in future tech where ad decisions being based on local data rather than sharing that data to make a decision on a server, and in conversions being tracked by an anonymized process. But this means that you are baking a certain amount of business logic into the browser. So, in addition to advertising providers needing to do substantial work to leverage these new features, they also might have a mismatch between what their product does today and the proposed browser schemes. In addition to making this a remarkably complex technical problem, it is also why Google's attempts to block third party cookies has been held up by regulators for years.
- CharlesW 4y ago> Apple is using their dominant (monopoly) position in mobile devices to shut down competitors… Except that Apple not only hasn't done that, but has created ad network APIs and processes to support "competitors". https://developer.apple.com/documentation/storekit/skadnetwork/ https://developer.apple.com/documentation/storekit/skadnetwo... https://developer.apple.com/documentation/storekit/skadnetwork/registering_an_ad_network https://developer.apple.com/documentation/storekit/skadnetwo...
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- ajross 4y agoThey certainly haven't done it yet, though some things viewed in this perspective seem on the spectrum. The iOS 14 change of tracking preferences to opt-in absolutely put a knife in Meta's advertising business. And, sure, it can be viewed as a privacy feature, and that's great. So what happens next year when Apple rolls out their own user-targetted ad system based on the same tracking data they disallowed to competitors? It's a slippery slope for sure. Apple deserves the benefit of the doubt, but I don't see how anyone would look at this as good news.
- aorloff 4y agoApple doesn't have to even roll out a user-targeted ad system. All they have to do is offer a buying platform where you can track conversion on Apple devices and software better. In other words, they don't have to offer more user-level accuracy to the end buyer, they simply need to measure campaigns more accurately on iOS (a bit of a simplification but not much). That alone will make their DSP a dominant player in the industry.
- heavyset_go 4y ago> Apple deserves the benefit of the doubt No trillion dollar corporation deserves the benefit of the doubt, including Apple.
- 4y ago
- jiscariot 4y agoBut they're the good guys(TM), so we probably won't see NYT hit pieces every other week.
- bryan_w 4y agoJust wait till their sweetheart deals are up and they come for 30% of NYT's revenue
- hapticmonkey 4y agoThey're not shutting down competitors, they're just requiring they ask for permission for tracking IDs. If people are opting out of that tracking, then maybe those businesses were built on customer ignorance to begin with.
- disgruntledphd2 4y agoThe difficulty is that they've created a situation where only Apple can track you. And now they're creating a bigger ads business. This sure looks like using dominance in one market to increase share in another, which EU law tends to regard as anti-competitive.