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Comment by naikrovek | Hacker News Reader

> Epic has a monopoly on selling items inside Fortnite.

3rd party artists can't create anything that can be used inside Fortnite, neither inside the v-bucks store nor outside of it. There's no 3rd party "market" at all.

Apple has a market where third parties can market their apps. Apple requires a cut of all purchases made through that store, which alone is not monopolistic. Apple also requires that you sell your iOS app and any iOS in-app purchases only in their marketplace. That's the monopolistic part.

No one can create 3rd party items for Fortnite at all, so there is no monopoly on where 3rd party items for Fortnite are sold.

It's not even illegal to have a monopoly; it's illegal to use your monopoly powers to keep other parties from competing, and that's exactly what Apple has done.

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So, let's say hypothetically Epic allowed the sale of third-party skins in Fortnite. Would a skinmaker would be entitled to demand the following concessions?

1. The ability to install skins outside of the V-bucks store.

2. The ability to pay for Fortnite skins using payment methods other than V-bucks.

Alternatively, should Epic not be permitted to impose the following restrictions in their Fortnite store?

1. Skins must be approved by Epic before they can be sold. No x-rated skins, etc.

2. Epic will take a 30% cut of each skin sold.

What if I'm a skinmaker that wants to compete with Epic because I think I can provide higher quality Fortnite skins than they have made. Should I be able to demand to participate in the "Fortnite skin" market which is currently 100% controlled by Epic?

Not all monopolies are created equally. Some have greater cost to society. For example, Qualcomm has an essential patent which grants them a monopoly over certain communications technologies but it has been mitigated by requiring them to license it in a fair, reasonable, and non-discriminatory (FRAND) way.

A monopoly by Standard Oil was pervasive in all of daily living because by the early twentieth century, they had control of more than 90% of the country's petroleum fuel production and logistics which they abused to keep any competition from ever gaining a foothold. By 1911, they were dissolved by the Supreme Court as per Sherman Antitrust Act.

VBucks and Fortnite are not pervasive in all of daily living, it is a tiny market and the monopoly is one which can easily be managed by society without breaking up the company.

> it has been mitigated by requiring them to license it in a fair, reasonable, and non-discriminatory (FRAND) way.

Writing it in passive voice makes it look like there is some governmental force at play that made them license on FRAND terms. They voluntarily agreed to that in negotiations with a standards body/industry consortium which otherwise would not have agreed to utilize their technology in a communication standard. The trade-off is they benefit automatically by getting distribution and licensing the technology to a lot of people that need to implement that standard.

> A monopoly by Standard Oil was pervasive in all of daily living because by the early twentieth century, they had control of more than 90% of the country's petroleum fuel production and logistics which they abused to keep any competition from ever gaining a foothold.

The key point here is that 90% market share constituted monopoly power, whereas Apple's 46% share of the smartphone market likely does not.

Apple and Google have some >90% and are colluding to keep their cash cows fat. Antitrust needs no monopoly to enforce.

> Antitrust needs no monopoly to enforce.

I'm not sure why you think this? Sure, certain Sherman Act violations (e.g. price fixing) do not require monopoly power to be considered illegal, but the specific claims in Epic's lawsuit (unlawful monopoly maintenance) definitely require proof of monopoly power.

“Conspiracy in restraint of trade” would fit perfectly what Apple/Google are doing.

The average American spends some what, 4-5 hours a day on their phone? Is there any even remotely comparable precedent for a company to control all trade through everything? The best I can think of is cable, imagine if there were only two cable companies and they not only had unilateral ability to control which channels appear, but also charged 30% to every channels profit.

Further, how many different commercial activities do people do every single day on their devices? This is a far, far bigger thing than any platform before it. And it’s dominated by only two companies with a history of collusion. These platforms are nothing at all like “a market” and trying to argue from narrow historical frames is poor form.

They are far bigger things. It’s more akin to a world, people use them for literally every part of their lives. I don’t think narrow precedent should ever rule our thinking and especially when it’s clear there is no historical precedent here. We need to be “courageous” enough to use moral and logical thinking and not legalistic weaseling, we need to legislate them as new types of markets far bigger and more important to every persons life than any that’s ever existed.

> “Conspiracy in restraint of trade” would fit perfectly what Apple/Google are doing.

Proving a conspiracy claim requires two parties to knowingly participate in the conspiracy. While you may believe Apple and Google are conspiring together there is a reason Epic's lawsuit does not make any conspiracy claims - their lawyers know they'd never be able to win such a claim.

At any rate that is irrelevant to my point: Epic made several claims in their lawsuit that will require proof of monopoly power.

You shifted from arguing from a purely theoretical view (if Epic had a market should they be regulated) to now arguing a very narrow view local to this case. I’m arguing the big picture, so feel free to engage there or not.

Sure, Epics specific case may be the only strategy they can take - they won’t find any documented collusion when there’s only two players, that’s obvious. They already colluded to suppress wages. We can all see what’s happening. You’re arguing semantics on one side then arguing generalities on the other. But let’s call a spade a spade: theres no smoking gun, but they are colluding, it’s just a silent “don’t lower yours and I won’t lower mine” nod.

Edit: further, with the amount of lock in they each have, there’s not much pressure anyway. It’s just not comparable to anything really that has existed beyond Windows/Mac which were/are entirely open. And it goes even further. Mobile phones are on people at all times. They do way way more. You have accounts with hundreds of apps, services. It’s just not a comparable thing, it’s a world with big lock-in.

I mean, you changed the topic to whether antitrust cases require monopoly power, which I acknowledged wasn't required for certain types of violations such as price fixing, but is required for the original topic being discussed in this thread, which is Epic and their lawsuit against Apple.

How are they colluding? Both google and apple seem to be trying to commoditize each other's (very different) cash cows and both are mostly failing at that. At least, google is failing miserably to make a dent in smartphone hardware, apple seems to struggle with software services, but maybe not as badly as google is at hardware.

Apple avoids search and ads. Google avoids high end anything (except phones perhaps, but they will never take Apple’s share there anyway).

Apple has a 100% monopoly on the market for iOS app distribution, which can be argued is bad for the customer because the 30% revenue share they take is inflating app prices.

People keep saying this but in an antitrust case you cannot simply declare the narrowest market that fits your argument and expect the court to accept it. The court will examine the market reality and examine how consumers actually behave to determine what the actual relevant market is, and it's unlikely that a court would find "iOS app distribution" to be a separate and relevant market for antitrust purposes. I've explained why in detail elsewhere [1], but in short, the US legal system generally does not consider an aftermarket consisting of a single brand's product to be a relevant product market unless specific rules are met:

> Because it would be inappropriate to punish a firm for its natural monopoly in its own products, courts embraced a sweeping prohibition against analyzing alleged anticompetitive activity by focusing on single-brand relevant markets: "[A]bsent exceptional market conditions, one brand in a market of competing brands cannot constitute a relevant product market." [2]

For a much more thorough explanation see my linked comment below.

[1] https://news.ycombinator.com/item?id=24193731

[2] https://casetext.com/case/metzler-v-bear-automotive-service-...

Not being a pure monopoly doesn't prove that Apple doesn't have market power. Moreover I don't think people are saying that Apple has a monopoly of smartphones.

The argument is that Apple is using their market power to set prices that seems well above the marginal cost. And they also have created policies that prevent competition in their store. Imagine Windows not allowing any apps unless they give them a 30% cut.

I think it's a very American perspective to see this as black or white. You should be able to tell something is wrong by looking at what Apple is doing. Looking at how Fortnite operates does not give me the same feeling. Obviously Fortnite as a platform is not the same as iOS as a platform, and holding monopoly positions for each yield completely different outcomes. They are not equivalent.

Regulation is a blunt tool - it not enough to just feel they are not equivalent. Any law that may apply to Apple will apply to everyone else as well. The American perspective is that the government should not pick and choose winners

Maybe you should read more about Epic games the “private” company. It is owned mainly by Tencent which answers to the Chinese government.

How is that relevant to this conversation at all?

Isn't Fortnite a free online game? How is that comparable to a general-purpose computer that the consumer bought and owns?

If skins are what I imagine they are, Epic needs oversight over which ones players are allowed to use because they affect the experience of other players. And Epic provides Fortnite gratis specifically so that they can sell premium features like skins, so it seems completely reasonable that they would take a large cut out of third-party sales of those features.

To be analagous to IOS devices, Fortnite would have to be a single-player game that players bought a copy of. In that case, I think people would be right to be upset if Epic prevented them from getting skins through some other channel.

> 1. The ability to install skins outside of the V-bucks store.

Isn’t this like allowing mods, custom maps etc? So CounterStrike, DoTA, etc shouldn’t exist?

Honestly I started off on the fence but now I’m 100% against Apple here, and I’m an iOS dev. This is kinda crazy.

Xbox has a monpoly on their game store. Sony has a monpoloy on their game store.

Come on - is this argument going to be used for all these too? Walmart has a monopoly on what sells in Walmart.

Once you decide to shop at wall-mart you can easily switch to other markets or buy items from other stores. not comparable at all.

If there were basically only Wall-Mart and Target to buy stuff from, and you had to commit to one for 2-5 years every time, you bet they should be under heavy scrutiny.

Sony and Microsoft are a better comparison, but different because 1) their consoles are huge loss leaders, phones are not and 2) they are way less essential and used by an order of magnitude less people than phones.

But the irony is that loss leaders are a sign of market abuse / market power. That's the normal anti-trust claim - predatory pricing. If anything, Apple is charging a premium price for their experience.

Apple has become essential and trusted in part perhaps because it has exercised near iron control over almost all aspects of their platform.

Unironically there should be alternatives for those platforms, and the Switch

I'd include walmart too if walmart is the only store I'm ever allowed to shop at.

Apple doesn’t force you to own an iPhone.

It does force you to use their app store for 2-7 years once you bought one until you replace it.

It doesn't. You're free to replace it and switch to android (or better - linux) at any moment.

In a world where walmart is the only store & it bans all other retail stores from existing, Walmart will become monopoly.

This is false equivalence

What do you call the Play Store? What do you call Android? Talk about false equivalence, you’ve just demonstrated that.

1.I have installed LineageOS which has 0 apps from Gogle

2. I have installed android apps from F_-droid/Samsung app store or even Vivo app store

3. I have directly installed apks which didn't appear on play store directly from the internet

Where is my false equivalence? Pray tell me?

Google makes it impossible for apps to run without play store but I've used 0 google apps on android for 1yr and lived easily with 0 issues

Remove apple's app store, I dare you and then tell me you can live for one year.

Apple has monopoly on app store.

Walmart can't be compared.

Google has technically enforced monopoly and which I oppose. I never said google play store isn't a monopoly.

Are you sure you know what false equivalence means?

Dude, you don't need to buy an iphone, you don't need to by an xbox, you don't need to buy a playstation - if you do though you will be using their stores / they will be getting a cut.

But when I buy Android I can side load app

If I buy Apple phone I can't sideload app. At all.

How ia this not a monopoly.

Also why you bring xbox into picture. It's a gaming console not a general purpose device ppl use 4+hrs in a day.

They can have their cut buthe issue that you're ignoring is that they don't allow side loading and that they can randomly kill any app they want. Like they have done in the past and small developers don't have the money Epic does

The Play Store has very little for tablets. The Android tablet market is effectively dead.

Depends on what you define as their game store. I can purchase a game that is playable on the xbox from anywhere that sells a copy. One of these places is the digital store that comes with the xbox. But I can also go to cd-keys, or amazon and buy a copy there that will still work on an xbox.

Wait, what? It doesn't matter where you buy an XBox game, Microsoft is getting their cut as platform holder no matter if digital or retail.

That's a licensing fee and separate to the discussion about market control. As it stands (although this is starting to change) a developer can sell the game through a variety of different avenues (online, brick and mortar, the xbox store), these avenues may have different prices associated and drive where the consumer makes their purchase.

That is the relevant comparison here, if Epic want to provide Fortnite on iOS they HAVE to use the app store and associated requirements. If they want to provide it on XBox, they pay a licensing cost for the proprietary tech they leverage from Microsoft. But they can choose to sell the game on Amazon if they want.

Even if they sell the game on Amazon, they still pay Microsoft a royalty for each game sold. Whether you want to call it a "licensing fee" or a "Microsoft tax" seems like a matter of semantics. Also keep in mind that their publisher agreement with Microsoft gives Microsoft approval rights over the game itself, marketing materials, and even packaging. And if they sell virtual goods in the Xbox version of the game they have to go through the Xbox store and pay Microsoft 30% of that.

The amount of control console manufacturers exert over the games allowed on their platform is not dissimilar to the Apple and its App Store.

I don't think you realize the permissions game makers need to even sell a CD that works on xbox. If that CD is not signed off on by microsoft - total control -> it's not going to work in your console - period. And the irony - EVEN IF microsoft does not market / distribute or accept payment for the game (Apple does all of this) I can guarantee you Microsoft (and sony) get a cut.

For now.

Look at the PS5: the ability to put a disk in is a legacy that's clearly going away by Sony making it an option you'll have to pay extra for. The entry level model is digital only, for better or worse.

That's definitely true, and as they move away from physical media more scrutiny of what they are doing is required. But as it stands this isn't yet an issue for game consoles

AFAIK, you can install 3rd party apps to Xbox without paying MS. If that is not true, it should be fixed.

There is still a retail market on consoles. So not entirely monopolistic. Also iirc you can use your own payment method on those consoles.

XCode, the iOS software libraries and tools are all Apple products and are used to develop software for iOS. By requiring that Apple allow developers to distribute software outside the App Store with no revenue for Apple, you are requiring Apple to give away their products for free. On what basis do you or anyone else have that right?

Apple has a monopoly on how those products are sold and licensed because they are Apple products, in exactly the same way that Fortnite and it's marketplace are Epic products. There's no requirement for Epic to open that up, and if they do it will be on their terms. Their house, their rules.

How would you feel if your ISPs started wanting a cut of all money you made via the internet?

After all, it's their house so their rules...

Apple have carved out a significant market share of mobile users. They've locked down the OS so you can't install your own apps on it and they've crippled the browser so you can't build nice web apps. For businesses like Netflix, Spotify and Epic who's userbases arguably transcend the App Store, why should they pay the Apple Tax?

Apple doesn't "own" these users. But if you want to extend your services to them you have to pony up.

I don't expect to use my ISP's infrastructure for free. However most of that infrastructure was built using tax payer's money, on tax payer's land with special privileges granted by the government, and special tax incentives for improvements. In return we, the people, demand certain concessions and rules to compensate us. I'm actually in the UK, but the situation on this here and in the US are different in many details but in broad strokes are equivalent.

The iOS operating system, developer tools, platform libraries and the App Store and distribution system are all Apple products built by them on their own dime and at their own commercial risk. On what basis do you get to dictate to them what features they must or must not develop, what services they must be coerced to provide and what contractual relationships they are required to enter into? There's just no basis for that.

Fair enough but Apple and Google have essentially built out the entire mobile digital ecosystem. While I can empathise with the mindset that they should reap the benefits of investing and nurturing the platforms, they are also for all intents and purposes a duopoly so I am in favour of that control being wrested back into the hands of consumers and the relationship being renegotiated - the distribution platform of mobile software feels more like a public good than a private ecosystem given the way we depend on it

Maybe we just tell apple they can do what they want as long as their devices don't connect to the public cellular networks.

Ive explained why Apple's system is their product and therefore their property, and Ive explained why ISPs are a different case. I'm not seeing any attempt at all to seriously, coherently provide a credible counter argument that makes any actual sense.

Radio stations used to sell cheep AM radios that were only tuned to their station and the government outlawed them.

You can also buy vbucks outside of the App Store and use them on your iOS devices. I’m not sure what’s the distinction here.

Ah, but that's outside of Fortnite. Inside Fortnite they have a monopoly on selling items, right?

The core point your parent was trying to make is that Fortnite is not an open market. No one but Epic provides goods to the Epic store. Apple allowing third party developers is the distinction being made.

Apple's platforms aren't an open market either. They allow third party developers to develop for their platforms, subject to you agreeing to their terms.

Agreeing to a TOS is a standard for open markets. Splitting hairs over a TOS existing is ignoring the fact that Epic doesn't allow third parties to sell in their market (with or without a TOS).

When you accept Apple's developer agreement, you're agreeing to a contract. It absolutely isn't an "open market" for any definition of what that means. Apple has exclusive control of their IP and they are offering a way for you to license it on their terms.

Regardless of what term you use it's a fact of reality that right now no one else but Epic can put content on the Epic Store which is not true of Apple and the App Store.

Which would be irrelevant since the original comment was that Epic had no monopoly on any market, and didn't specify the terms and conditions for a market to fit the argument.

Yes, thank you.

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