I never thought about it like this. It could be viewed differently because the Xbox is a game console and the iphone is a general handheld computer, but perhaps it should be illegal to restrict users installing software on your device by any means they choose, though there's no reason for you to support those means.
What is an open platform and how does it get defined? Installing software is a feature implemented by the manufacturer. Should we really be requiring Apple or any manufacturer, by law, to implement specific defined features to support and enable side loading and management of external apps. Who gets to define those features and say which products should or shouldn’t have them? Who gets to certify compliance? Who gets to specify open as a technical standard that can actually be implemented?
If this had been done in the 80s, we’d probably still be stuck with consoles having an 80s style cartridge slot on them, with specs written in legislation and updatable only by government committee.
Secondly, you can "side load" iOS apps as well. You just have to go through a process of jailbreaking your iPhone which is not illegal but it may void the warranty.
When you buy the iPhone you are also buying into the platform. If having multiple options for app stores is a necessity for you then an iPhone is the wrong device to purchase. Buy something else. There is nothing wrong with voting with your wallet as there are other phones on the market for people to buy.
The argument is that that approach is anti-competitive and unfair, especially since Apple itself gets a large cut of app sales.
I'm not coming down hard on either side, just yet. But I don't like the feel of this sort of lock-in, and almost no one would question the use of a term like "lock-in." Some lock-in is surely legal, even if almost always unpleasant. But it's only a hop, skip and a jump to full-fledged antitrust.
Heading out but you pick up a few PC games. By the way, Target was paid to put those up on the shelf.
Grab a Sony Playstation gift card. They get a percentage of that as well.
At checkout, you sign up of the Target bank card save 10%. They get a nice initial chunk from that and the bank running that card pays a monthly percent to Target for sending them over their customer.
(don't look into the publishing companies' tactics cause that will send you over the edge)
Apple themselves? Part of their marketing is literally that you can do everything on their devices.
> Should we really be requiring Apple or any manufacturer, by law, to implement specific defined features to support and enable side loading and management of external apps.
I can't see why not, the mobile app market has terrible competition, there's a big market issue here.
What you may be thinking of is that the consoles are not the main source of profit. And that the profits from consoles may take some time to make up for the expenses of developing and manufacturing those consoles.
>And that the profits from consoles may take some time to make up for the expenses of developing and manufacturing those consoles.
Yup, and during which time, they sell at a huge loss.[1]
You're right that Nintendo tries to buck this trend, but they also realize it's a delicate balancing act.[2]
[0] https://www.businessinsider.com/xbox-one-x-price-explanation... [1] https://www.fool.com/investing/2019/06/18/sony-microsoft-gam... [2] https://venturebeat.com/2016/10/26/nintendo-wont-sell-switch...
Your alternative definition applies to pretty much everything with R&D costs. The first unit sold is pretty much guaranteed to not make up for R&D costs, but for some n the margin made on the nth unit covers it, and the seller finally starts turning a profit.
I think what your citations are actually saying is that even the last unit sold does not cover R&D costs, and it has to be made up in other divisions (such as games) in order for the whole venture to turn a profit. But each individual unit is still marginally profitable - if they could sell enough of them (perhaps far more than the size of their market) they would eventually turn a profit on the console itself.
This sounds like a claim about cumulative profits, no?
Maybe you're instead suggesting that either prices rise or manufacturing costs fall over the lifetime of a console?
But what I think you mean to propose is a restriction at the software level, not hardware level. That anyone who sells an operating system must allow any app to be installed within that OS. I think we leave it as an exercise for the reader to define "operating system" when it comes to our increasingly "smart" homes and cars.
The iPhone boot ROM will only launch operating systems cryptographically signed by Apple:
https://support.apple.com/guide/security/hardware-security-o...
It's like claiming that nobody can have a monopoly on electric car charging stations because the customer could just buy a gasoline powered car and electric cars don't even have majority market share. It's still a monopoly. It's a monopoly on charging stations, not a monopoly on cars.
Any mechanism for side loading apps would also be an Apple product, designed and written by them. They would be responsible for supporting it, and ensuring it was secure. Maybe they don’t want to do that, so who gets to force them to, and who gets to decide if they complied with that directive? Who gets to specify it and take responsibility if it causes problems and incurs costs on Apple or issues for their customers?
You’re not talking about stopping Apple from doing something, you’re taking about coercing them by legal requirement to do new different things, and you’d better be very specific and careful about what you are forcing them to do.
Personally yes, that's the textbook of unfair competition.
Yes, of course. The fact that you can't use the other company's chargers means that there are then two markets there, one for Tesla-vehicle charging stations and one for Nissan-vehicle charging stations. You can't substitute one for the other in that case, you need one compatible with your car. It's the same reason that gas pumps aren't the same market as electric car chargers, or that gas pumps aren't the same market as diesel pumps. If there is only one diesel pump in the state then it has a monopoly no matter how many gas pumps there are because you can't use gasoline in a diesel vehicle.
If you could use either type of charger with either type of car then they would be in the same market, because a customer who wants to charge their car could substitute either one for the other, so they would each actually be in competition with the other and neither would have a monopoly.
I think the fact that the "chargers" and the "cars" are hypothesized to be operated by the same company is what's messing people up.
Suppose you have two companies that each operate half the charging stations in the same region. One is Tesla, and you can only use them to charge a Tesla vehicle. The other is Exxon, which has started installing electric car chargers at their gas stations, and where you can charge any car including a Tesla. Well then Tesla hasn't got a monopoly on anything, because any Tesla owner can go charge their car at Exxon, and Exxon doesn't have a monopoly for Tesla vehicles, because they can also go charge their car at Tesla. But Exxon does have a monopoly for charging non-Tesla vehicles, because if you have a Nissan or a Chevy, you can't use the Tesla chargers, leaving Exxon as your only option.
1) The manufacturer lacks sufficient market power in the "foremarket". (In the case of Apple, this would be the sale of the phone. In your example, it would be the sale of the car.)
2) The consumer was aware of the "aftermarket" restrictions when buying the original product. (In the case of Apple this would be the App Store pricing and rules. In the car example it would be the location and cost of the charging stations.)
3) The consumer does not face substantial costs to switch to an alternative product. (The cost of buying a new car would probably be considered substantial but I'm not sure a new phone would.)
The courts have reasoned that if the consumer had sufficient information when making their initial purchase decision, then they had the opportunity to buy a competing product without those restrictions. If they went ahead and bought anyway, they knew what they were signing up for. It's like buying a razor and then being stuck with expensive replacement razor blades. Or buying a movie ticket and then being stuck buying expensive popcorn from that theater.
Yes, once you buy the movie ticket and enter the theater they have a "monopoly" on your snack purchases. No, you're not likely to win an antitrust claim against the theater.
The cost of switching phone platforms is massive compared to the app market. Phones can cost over $1000, apps are commonly $1, a difference of a thousand fold. And that's only the hardware cost. Then you have issues if there is any other app you need which is only available on one platform, or if you make use of Google or Apple services that are only well supported or supported at all on one platform and would incur substantial switching costs to move to the other.
You also have a different problem here:
> The courts have reasoned that if the consumer had sufficient information when making their initial purchase decision, then they had the opportunity to buy a competing product without those restrictions.
Which would only apply if there was a viable competing product without those restrictions. But there are only two viable phone platforms and Apple's has a strict monopoly while Google's has a de facto one where Google Play has >90% share of the Android market, and they both impose similar restrictions, so a viable option without those restrictions isn't there.
Furthermore, the customer for app distribution is at least as much the developer as the user -- they're the one who pays the app store's fee, right? -- and they don't get to choose which phone their customers have already bought.
Ultimately that is up to the courts to decide. But I will point out that in a previous case involving IBM S/390 computer systems, the court decided this requirement was not met, despite the hardware expense and associated software compatibility limitations.
> Which would only apply if there was a viable competing product without those restrictions. But there are only two viable phone platforms and Apple's has a strict monopoly while Google's has a de facto one where Google Play has >90% share of the Android market, and they both impose similar restrictions, so a viable option without those restrictions isn't there.
I'm not sure which specific restrictions you are referring to here. If the complaint against Apple is that you cannot install apps from 3rd party sources on your iPhone, there is a competing product that allows you to do that on the market.
> Furthermore, the customer for app distribution is at least as much the developer as the user -- they're the one who pays the app store's fee, right? -- and they don't get to choose which phone their customers have already bought.
This is not relevant for antitrust purposes. Developers are not entitled to demand a specific company give them access to that company's users.
And the government doesn't classify trusts[1] by the dictionary definition of monopoly:
> 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.
[1] https://www.ftc.gov/tips-advice/competition-guidance/guide-a...
It wasn’t until 2010 that IEs market share started eroding. It didn’t have anything to do with the government.
Almost 20 years later, MS still has the same market share in both operating systems and office productivity and no one cares about browser dominance except for Google.
When MS was under investigation they were the most valuable company in the US. Now they are number 3.
So how effective was the government last time?
The market solved the problem in ways that the DoJ couldn’t have anticipated. It turned out that licenses fees for closed source web browsers were just not something that businesses and consumers were interested in putting up with.
Few remember how much of an equal offender Netscape was when it came to proprietary extensions to the web.