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> How can the app store promote competition when it is a monopoly on iOS? The court did not decide that the relevant market was iOS only, as Epic wanted. > A

> How can the app store promote competition when it is a monopoly on iOS? The court did not decide that the relevant market was iOS only, as Epic wanted. > A threshold issue in any antitrust case is defining the “relevant market.” Here, Epic argued that the relevant market is Apple’s iOS system. Apple argued that the relevant market is the market for all digital video games, where it is one of many players. The court disagreed with both sides, and it instead defined the relevant market as “digital mobile gaming transactions.” Under this formulation, the court found that Apple has a 52–57% market share in the “digital mobile gaming transactions” market. But this was not enough for the court to conclude Apple has monopoly power. https://www.klgates.com/Court-Issues-Mixed-Ruling-in-Epic-v-Apple-Antitrust-Trial-10-6-2021 https://www.klgates.com/Court-Issues-Mixed-Ruling-in-Epic-v-... This article is about Epic losing their appeal of the lower court's rulings.

deleted 4y ago
[deleted]
giobox 4y ago
And this should be the first question almost anyone asks themselves in a discussion about an anti-trust/monopoly case - defining "the market" is the lynchpin upon which much of antitrust law works both in Europe and the United States. Also be wary of comments in this thread that don't weigh this most important element of the entire process well. All too often these discussions on anti-trust issues become meaningless on this site because everyone involved is using a personal definition for "the marketplace". Step one of any attempt to claim Apple holds a monopoly will require you to define exactly what the market is, in quite specific terms, and have the court agree. That didn't happen for Epic here.
- KyeRussell 4y ago
  Yep. It really feels like a bunch of kids read up on ‘90s Microsoft, internalised a third-hand wildly simplified definition of ‘antitrust’, and used it to add a moral high-ground angle to what is essentially an iOS power user feature request. It’s often the first step in a whole lot of doublespeak. “This will set everybody free”, but at the same time, “this doesn’t present a security issue because nobody will use it”. To be clear, I think that the government should storm Apple Park with buns glazing and force them to do a more reasonable degree of rent-seeking. I’m not going to pretend that this is for any reason other than “I think that 30% is a dick move”. You don’t just get to pretend that Android doesn’t exist, or that the vast majority of ways that people communicate aren’t cross-platform, or that IOS has any material network effect whatsoever. So you really end up with two camps, one camp who always stop short of saying “iOS is just better in my eyes, and I want to be able to do more with my phone.” And the other camp is…let’s be honest…Android users. And the mere fact that there’s so many people in this camp I think directly contradicts any assertion that there’s a monopoly in the first place.
  - fsckboy 4y ago
    you're not exactly agreeing with GP, you are going overboard, the court said these types of cases are covered by antitrust, but that Epic had failed to make its case. (like, murder is still illegal even if a particular case is not made) But it said ... that Epic, regardless, had “failed to establish, as a factual matter, its proposed market definition and the existence of any substantially less restrictive alternative means for Apple to accomplish the procompetitive justifications supporting iOS’s walled-garden ecosystem.” In other words, while these types of contracts can be within the scope of a Sherman Act claim, that wasn’t relevant to the court’s decision in this case.
  - dgoldstein0 4y ago
    "buns glazing" Lol typo or intentional?
    - techdragon 4y ago
      I love how autocorrect mistakes sometimes just come out sounding like rhyming slang… a less obtuse version than most real dialects of rhyming slang, more understandable by most people.
      - jay_kyburz 4y ago
        There was an AI thread a few days ago about how Open AI could not come up with a catchy slogan for selling hot cross buns in the UK. Could be a reference to the thread, or the actual slogan used in the UK.
        techdragon 4y ago
        It’s an interesting shortcoming of the large language models that they struggle to “play” with the rules of the language very much. I’ve tried to get GPT 3, 3.5, and 4 to generate business names and other names for things and it’s not particularly good at it. It frequently “runs out of creativity, and starts to repeat the same combination of basing building blocks. The worst example I came up with had moderately specific business names with a particular theme like an “1890s” or “1970s” or “late 1990s computer startup” style of name.. it would frequently run out and start repeating the same building blocks in under 50 examples, the absolute worst started repeating itself at about item 20 and the list gets increasingly repetitive from that point. I built a modified name generator based on some existing open source code that’s been around for several years now based on GPT2 and sure I couldn’t ask to go give me something with a specific theme… but damn it was way more creative at generating new words that could be names and it was t hard to filter the output to be useful since I could get it locally in batches of thousands overnight.
- thayne 4y ago
  Define the market as mobile OS and it would be pretty hard to argue that Google and Apple aren't a duopoly. And they both are definitely abusing that market power, often in very similar ways, including using that duopoly to favor their app store products, which includes a large commission for them.
  - simonh 4y ago
    The argument there for Apple is whether the App Store is a product, or a feature of their product. In Google's case they have chosen to offer their store un-bundled from the base OS. Apple does not, for them it's just a feature of their phone in the same way that the stores on games consoles are features.
- patapong 4y ago
  I guess they did not apply the SSNIP test to define the relevant market: https://en.wikipedia.org/wiki/Small_but_significant_and_non-transitory_increase_in_price https://en.wikipedia.org/wiki/Small_but_significant_and_non-... If apple raised their prices for apps by 5%, clearly most users would not jump ship to android, since they have a large library of apps on iOS and significant other platform lock-in (messages, photos, subscriptions etc). So according to this test, the relevant product market would be "providing apps for iOS devices", which apple clearly has a monopoly on at the moment. I wonder if this argument came up.
  - selectodude 4y ago
    [flagged]
    - patapong 4y ago
      Thank you for your helpful response selectodude! In that case perhaps I should apply there, can I list you as my reference? That answers my question, thanks for supplying the case reference. EDIT: Actually I don't understand how this case applies... The key passage seems to be: "We conclude that cellophane's interchangeability with the other materials mentioned suffices to make it a part of this flexible packaging material market." My point is that there is no interchangeability between ios apps and android apps. Customers tend to have either ios or android and aren't able to freely choose between the two. What am I missing?
    - kergonath 4y ago
      > Epic's exceptional powerhouse firm, Cravath, Swaine & Moore, was not as well versed in law as you are. Well, they lost, didn’t they? So their argument wasn’t that compelling, and it wasn’t that clear cut in their favour at the very least.
      - hackmiester 4y ago
        Let's not let that get in the way of a snippy sarcastic comment though... ;)
Workaccount2 4y ago
>the court found that Apple has a 52–57% market share in the “digital mobile gaming transactions” market. This seems surprising low, and I suspect there is some kind of nuance being left out or an oversight in the methods of the study that found that number.
- lapcat 4y ago
  That's the iPhone share of the US smartphone market.
  - 29083011397778 4y ago
    Which is weird in itself, as it seems to completely overlook the Nintendo Switch or the (admittedly less common) Valve Steam Deck.
    - detaro 4y ago
      Doesn't seem that weird that they looked at "mobile gaming" as in "smartphone gaming", not "mobile gaming" as in "gaming on portable devices"?
    - apatheticonion 4y ago
      Also how many of the ~40% Android devices are sub $300 devices which are incapable of playing games like Fortnight?
  - Workaccount2 4y ago
    Right, but when you break it down by age, virtually all young people have iPhones. But perhaps they don't have credit cards...
lapcat 4y ago
> But this was not enough for the court to conclude Apple has monopoly power. I don't understand that. How is a single company controlling more than half of the entire market not monopoly power?
- giobox 4y ago
  I'm not passing judgement on this case and this comment has no relation to its facts, but generally speaking a single company controlling ~51 percent of the market is not the definition of a monopoly, at least not for anti-trust purposes. Indeed a company can have market share well beyond this and not fall foul of anti-trust law, depending on facts of the case. It's much harder to unfairly distort an open marketplace with 51% share than say 90%, most of the time. Again, this is why the marketplace definition step of this process matters so much!
  - lapcat 4y ago
    > unfairly distort an open marketplace I'd hardly call it open. Whether or not you call Apple a monopoly, Apple and Google indisputably have a duopoly over mobile OS. Moreover, Google indisputably has a monopoly over web search: ~93% market share. (I'll never understand why we've done nothing legally about this.) And the craziest part is, our so-called antitrust laws allow Google to pay Apple $billions per year to be the default search engine in Safari. The duopolists openly conspiring.
    - deleted 4y ago
      [deleted]
    - GeekyBear 4y ago
      > Whether or not you call Apple a monopoly, Apple and Google indisputably have a duopoly over mobile OS. In mobile gaming, Apple and Google are the largest participants, but not the only participants. We have the Switch, the Steam Deck, and other smaller companies as well.
      - 4y ago
downWidOutaFite 4y ago
The perversity of this can be seen by the thought experiment of Android not existing. What would happen? Apple would ironically have less power to abuse their platform because regulators would gain authority to police many of the abuses.
- foobarding 4y ago
  If Android didn’t exist, some other OS would take its place. Samsung would have developed its own most likely, which would at this stage probably resemble something very similar to what we have today. Only difference is that Google would have been in a position more similar to the one it faces with Apple. I agree also the point you are making. If Apple somehow commanded 90+% of the smartphone market then they would likely face much regulation.
- simondotau 4y ago
  Epic couldn’t point to any new “abusive” behaviour between when Apple was a ~1% market share minnow to when they became a ~50% market share behemoth. This is critical. In order to abuse a monopoly, you need to have abused your monopoly.
  - MBCook 4y ago
    As much as so many hate how Apple acts, they’ve gotten better since day 1. They let developers choose more price points. They offer only a 15% cut of subscriptions in a number of circumstances instead of always taking 30%. IAPs and subscriptions have given developers more choices of how to monetize their apps. At no point did they ever use their position to squeeze more money from developers. Even the yearly developer fee is still $99 despite the HUGE increase in App Store revenue. It’s understandable people want Apple’s cut to shrink, but that doesn’t appear to be legally required. They didn’t make things worse so it seems they’re in the clear. (They still lost on the alternate payment method thing)
    - DangitBobby 4y ago
      > At no point did they ever use their position to squeeze more money from developers. Except the entire time they required a 30% cut and you weren't allowed to point to other payment methods.
bmitc 4y ago
> Under this formulation, the court found that Apple has a 52–57% market share in the “digital mobile gaming transactions” market. Is this true in the U.S.?

deleted 4y ago

[deleted]

giobox 4y ago

And this should be the first question almost anyone asks themselves in a discussion about an anti-trust/monopoly case - defining "the market" is the lynchpin upon which much of antitrust law works both in Europe and the United States. Also be wary of comments in this thread that don't weigh this most important element of the entire process well. All too often these discussions on anti-trust issues become meaningless on this site because everyone involved is using a personal definition for "the marketplace". Step one of any attempt to claim Apple holds a monopoly will require you to define exactly what the market is, in quite specific terms, and have the court agree. That didn't happen for Epic here.

KyeRussell 4y ago
Yep. It really feels like a bunch of kids read up on ‘90s Microsoft, internalised a third-hand wildly simplified definition of ‘antitrust’, and used it to add a moral high-ground angle to what is essentially an iOS power user feature request. It’s often the first step in a whole lot of doublespeak. “This will set everybody free”, but at the same time, “this doesn’t present a security issue because nobody will use it”. To be clear, I think that the government should storm Apple Park with buns glazing and force them to do a more reasonable degree of rent-seeking. I’m not going to pretend that this is for any reason other than “I think that 30% is a dick move”. You don’t just get to pretend that Android doesn’t exist, or that the vast majority of ways that people communicate aren’t cross-platform, or that IOS has any material network effect whatsoever. So you really end up with two camps, one camp who always stop short of saying “iOS is just better in my eyes, and I want to be able to do more with my phone.” And the other camp is…let’s be honest…Android users. And the mere fact that there’s so many people in this camp I think directly contradicts any assertion that there’s a monopoly in the first place.
- fsckboy 4y ago
  you're not exactly agreeing with GP, you are going overboard, the court said these types of cases are covered by antitrust, but that Epic had failed to make its case. (like, murder is still illegal even if a particular case is not made) But it said ... that Epic, regardless, had “failed to establish, as a factual matter, its proposed market definition and the existence of any substantially less restrictive alternative means for Apple to accomplish the procompetitive justifications supporting iOS’s walled-garden ecosystem.” In other words, while these types of contracts can be within the scope of a Sherman Act claim, that wasn’t relevant to the court’s decision in this case.
- dgoldstein0 4y ago
  "buns glazing" Lol typo or intentional?
  - techdragon 4y ago
    I love how autocorrect mistakes sometimes just come out sounding like rhyming slang… a less obtuse version than most real dialects of rhyming slang, more understandable by most people.
    - jay_kyburz 4y ago
      There was an AI thread a few days ago about how Open AI could not come up with a catchy slogan for selling hot cross buns in the UK. Could be a reference to the thread, or the actual slogan used in the UK.
      - techdragon 4y ago
        It’s an interesting shortcoming of the large language models that they struggle to “play” with the rules of the language very much. I’ve tried to get GPT 3, 3.5, and 4 to generate business names and other names for things and it’s not particularly good at it. It frequently “runs out of creativity, and starts to repeat the same combination of basing building blocks. The worst example I came up with had moderately specific business names with a particular theme like an “1890s” or “1970s” or “late 1990s computer startup” style of name.. it would frequently run out and start repeating the same building blocks in under 50 examples, the absolute worst started repeating itself at about item 20 and the list gets increasingly repetitive from that point. I built a modified name generator based on some existing open source code that’s been around for several years now based on GPT2 and sure I couldn’t ask to go give me something with a specific theme… but damn it was way more creative at generating new words that could be names and it was t hard to filter the output to be useful since I could get it locally in batches of thousands overnight.
thayne 4y ago
Define the market as mobile OS and it would be pretty hard to argue that Google and Apple aren't a duopoly. And they both are definitely abusing that market power, often in very similar ways, including using that duopoly to favor their app store products, which includes a large commission for them.
- simonh 4y ago
  The argument there for Apple is whether the App Store is a product, or a feature of their product. In Google's case they have chosen to offer their store un-bundled from the base OS. Apple does not, for them it's just a feature of their phone in the same way that the stores on games consoles are features.
patapong 4y ago
I guess they did not apply the SSNIP test to define the relevant market: https://en.wikipedia.org/wiki/Small_but_significant_and_non-transitory_increase_in_price https://en.wikipedia.org/wiki/Small_but_significant_and_non-... If apple raised their prices for apps by 5%, clearly most users would not jump ship to android, since they have a large library of apps on iOS and significant other platform lock-in (messages, photos, subscriptions etc). So according to this test, the relevant product market would be "providing apps for iOS devices", which apple clearly has a monopoly on at the moment. I wonder if this argument came up.
- selectodude 4y ago
  [flagged]
  - patapong 4y ago
    Thank you for your helpful response selectodude! In that case perhaps I should apply there, can I list you as my reference? That answers my question, thanks for supplying the case reference. EDIT: Actually I don't understand how this case applies... The key passage seems to be: "We conclude that cellophane's interchangeability with the other materials mentioned suffices to make it a part of this flexible packaging material market." My point is that there is no interchangeability between ios apps and android apps. Customers tend to have either ios or android and aren't able to freely choose between the two. What am I missing?
  - kergonath 4y ago
    > Epic's exceptional powerhouse firm, Cravath, Swaine & Moore, was not as well versed in law as you are. Well, they lost, didn’t they? So their argument wasn’t that compelling, and it wasn’t that clear cut in their favour at the very least.
    - hackmiester 4y ago
      Let's not let that get in the way of a snippy sarcastic comment though... ;)

Workaccount2 4y ago

>the court found that Apple has a 52–57% market share in the “digital mobile gaming transactions” market. This seems surprising low, and I suspect there is some kind of nuance being left out or an oversight in the methods of the study that found that number.

lapcat 4y ago
That's the iPhone share of the US smartphone market.
- 29083011397778 4y ago
  Which is weird in itself, as it seems to completely overlook the Nintendo Switch or the (admittedly less common) Valve Steam Deck.
  - detaro 4y ago
    Doesn't seem that weird that they looked at "mobile gaming" as in "smartphone gaming", not "mobile gaming" as in "gaming on portable devices"?
  - apatheticonion 4y ago
    Also how many of the ~40% Android devices are sub $300 devices which are incapable of playing games like Fortnight?
- Workaccount2 4y ago
  Right, but when you break it down by age, virtually all young people have iPhones. But perhaps they don't have credit cards...

lapcat 4y ago

> But this was not enough for the court to conclude Apple has monopoly power. I don't understand that. How is a single company controlling more than half of the entire market not monopoly power?

giobox 4y ago
I'm not passing judgement on this case and this comment has no relation to its facts, but generally speaking a single company controlling ~51 percent of the market is not the definition of a monopoly, at least not for anti-trust purposes. Indeed a company can have market share well beyond this and not fall foul of anti-trust law, depending on facts of the case. It's much harder to unfairly distort an open marketplace with 51% share than say 90%, most of the time. Again, this is why the marketplace definition step of this process matters so much!
- lapcat 4y ago
  > unfairly distort an open marketplace I'd hardly call it open. Whether or not you call Apple a monopoly, Apple and Google indisputably have a duopoly over mobile OS. Moreover, Google indisputably has a monopoly over web search: ~93% market share. (I'll never understand why we've done nothing legally about this.) And the craziest part is, our so-called antitrust laws allow Google to pay Apple $billions per year to be the default search engine in Safari. The duopolists openly conspiring.
  - deleted 4y ago
    [deleted]
  - GeekyBear 4y ago
    > Whether or not you call Apple a monopoly, Apple and Google indisputably have a duopoly over mobile OS. In mobile gaming, Apple and Google are the largest participants, but not the only participants. We have the Switch, the Steam Deck, and other smaller companies as well.
    - 4y ago

downWidOutaFite 4y ago

The perversity of this can be seen by the thought experiment of Android not existing. What would happen? Apple would ironically have less power to abuse their platform because regulators would gain authority to police many of the abuses.

foobarding 4y ago
If Android didn’t exist, some other OS would take its place. Samsung would have developed its own most likely, which would at this stage probably resemble something very similar to what we have today. Only difference is that Google would have been in a position more similar to the one it faces with Apple. I agree also the point you are making. If Apple somehow commanded 90+% of the smartphone market then they would likely face much regulation.
simondotau 4y ago
Epic couldn’t point to any new “abusive” behaviour between when Apple was a ~1% market share minnow to when they became a ~50% market share behemoth. This is critical. In order to abuse a monopoly, you need to have abused your monopoly.
- MBCook 4y ago
  As much as so many hate how Apple acts, they’ve gotten better since day 1. They let developers choose more price points. They offer only a 15% cut of subscriptions in a number of circumstances instead of always taking 30%. IAPs and subscriptions have given developers more choices of how to monetize their apps. At no point did they ever use their position to squeeze more money from developers. Even the yearly developer fee is still $99 despite the HUGE increase in App Store revenue. It’s understandable people want Apple’s cut to shrink, but that doesn’t appear to be legally required. They didn’t make things worse so it seems they’re in the clear. (They still lost on the alternate payment method thing)
  - DangitBobby 4y ago
    > At no point did they ever use their position to squeeze more money from developers. Except the entire time they required a 30% cut and you weren't allowed to point to other payment methods.

bmitc 4y ago

> Under this formulation, the court found that Apple has a 52–57% market share in the “digital mobile gaming transactions” market. Is this true in the U.S.?