When Apple takes the European Commission for fools: An initial overview
theplatformlaw.blog
theplatformlaw.blog
This is quite an interesting point that really helps to illustrate how over-priced Apple's "commission" is. I don't think it's a generally useful exercise for everything, or maybe even most things, as "market rate" is purely what people will pay. Pricing things based on production costs is a classic newbie mistake. But where I don't think this approach is or should apply to Apple, is in the fact of the monopolistic power they have over the system. It is much more a tax than a sale of an item. When you start talking about taxes, you're no longer talking about market rate because you're not dealing with a free market.
We can argue about whether or not Apple is a monopoly/gatekeeper, but for the purposes of the DMA (which is the subject of this article) they have been decided as such, and remember, TFA is talking about Apple's response to the DMA and the European commission.
At the same time, it is a clever technique. Create a walled garden, and subvert free market (act anticompetitively) only there. As long as your garden does not exeed 50% of the land, your golden.
Depends where you draw the line.
The AppStore has 100% market share of the iPhone platform.
Can Microsoft Windows block all web browsers except for Microsoft Edge because it only has a 29% share of device Operating System's?
Well, sure. But my local H&M has a monopoly inside the H&M. For example, they don't allow any competitor's products inside their store.
Would you call that a monopoly?
You can choose to shop anywhere without incurring significant detriment, you can event get H&M products at other stores.
For example, Tesla has a monopoly on electric cars?
Do I have that right?
In the descending hirarchy, you could have..
- Electronic Devices (Computers, Laptops)
- Portable Devices (Laptops, Phones)
- Mobile Phones (Samsung, Google, Apple)
- Mobile Phone OS (Android, IOS)
- Mobile Phone App Stores (Google Play, Apple AppStore, Aamazon App Store)
You're drawing the line at where a monopoly is applicable at Mobile Phones.
I'm saying since IOS has 2.2 billion devices, you can consider that it's own market large enough to be applicable for monopoly purses.
As I understand it, McDonalds has sold over 99 billion Big Macs.
Is McDonald's the only place people can eat a burger because they purchased a McDonald's product and are now tied to their ecosystem? No.
Is Apple's App Store the only place people can purchase apps for their products that they also purchased from Apple? That smells a bit fishier.
Context, nuance, etc. are important, that's where analogies fail because almost every analogy is broken at some level, it's an abstraction and not reality.
Tesla has sold 5.5 million cars, If Tesla decided tomorrow that I can only charge at a Tesla charger I would consider that applicable for Monopoly purposes. Tesla is a platform provider, and when they are competing with a separate product for that platform, with enough scale that should be applicable for Monopoly/Anti-Trust.
> I'm afraid I don't follow. Are you saying it's a matter of absolute numbers (2.2 billion devices) and not percentage of market capture?
My point is, with 2.2 billion devices, that's large enough to be considered it's own market that can be subjected to a monopoly.
> As I understand it, McDonalds has sold over 99 billion Big Macs.
I think you're just being facetious now.
Big Macs do not have their own market below them.
Thank you for explaining that. When you said "Obviously not" above, I thought you meant that your definition of monopoly shouldn't apply to Tesla - which I felt would be inconsistent.
The EU markets can do that.
However, in reality, regulations should be very scarcely used.
We are entering in a world more and more full of sanctions and artificial borders (like patents who protect a few chosen ones, or customs tariffs which are likely to affect GPU cards in case US<->EU enter competition together).
In this case, the message Apple wants to send is just to be left alone, instead of being brought to a planned-economy dream.
Apple isn't really a monopoly situation.
If users don't like the attitude of Apple, they can vote to close Apple: not buying theirs products.
You can perfectly live without Apple products (they don't even have official shops in few European countries), but this isn't the case with real monopolies, you cannot live without them, like WeChat Pay in China for example.
(I know that you know, it was just example of how regulations can get wrong)
You can really see these mechanisms in action in open source where making a profit and other market forces aren't at play, so developers are able to choose based on what they want. There are tons of open source apps for Android, and many many fewer for iOS. Android tends to get most open source first, with an iOS port coming later.
I'm in the US so maybe different, but it's increasingly hard to "live without Apple products." I refuse to buy Apple products, and it has had an affect. My kids keep running into challenges where an app they need for school or something is Apple only. Other times the app will be available on Android, but the teacher only covers the iOS version. Most recently my son has been getting excluded because he is a "green bubble." So I'm not disagreeing with your whole post, but I do disagree with that part.
It's possible that a lot of software developers and/or companies thought like me and only did iOS apps.
The Apple App Store does have a monopoly on 2.2 billion devices and did $85 billion in trade in 2021.
But they'd be better off fining Apple come to Jesus money. A figure so astronomical the board considers firing Tim Cook and Apple considers abandoning the EU market on their own accord.
Only just though. Enough for them to consider it but not do it.
Europe doesn't have any of that.
UK? https://www.youtube.com/watch?v=0r7GRx8Sl-s
I would say may countries are moving to ban end-to-end encryption, which will lead to less free speech even privately: https://community.qbix.com/t/the-coming-war-on-end-to-end-en...
And free to speak about anything allowed, if the website isn't blocked at DNS-level.
Apple doesn't even have the highest market share here compared to the US - that's actually Samsung¹ although Apple briefly overtook Samsung in sales in Q4 2023.
¹ https://www.statista.com/statistics/632599/smartphone-market...
And of course, EU has to use ONLY those.
What kinds of free app developer is he talking about here? Surely if you are free you will stay on the old terms and never had much incentive to move anyway. Unless you’re another gatekeeper like the Microsoft, Googles and Metas then there might be other incentives. Or does he mean free but can’t be on the App Store? I’m not sure the EU is going to side with pirates and porn.
No, there's a lot more to it than just the money (commission and fees, etc). Apple has a strict set of rules and and approval process that apps have to go through. If your app violates any of their rules, you are not allowed to distribute your app. And unlike Android, if Apple says no then there are no other options, let alone good ones.
What they don't like is porn and gambling.
(and yes, apple is still doing review but people object to that part too, right?)
there are no technological solutions to social problems, and the network power of Facebook/etc is a social problem.
The OS already enforces gated access to the microphone through a permissions dialogue. Once it's enabled it's a glowing red, persistant status bar everywhere. Only one app can get a handle on this at a time, by design. I'm not sure what "mine your email" means, I'd imagine someone using Facebook has already given them their email. If you mean access to their email app's data, you also can't just reach into another app's files since they're sandboxed. There hasn't been any part of the discussion around sideloading that says Apple should also get rid of OS-level security and privacy features.
AFAIK, Play Protect on Android already does this (or the checking and warning part) for side loaded apps. Apple already has Gatekeeper and app notarization on macOS, and both these are intended to check for malicious apps and unsigned apps. The same thing can be done with a little bit of on-devide computation combined with Apple’s services on its cloud.
I honestly think many people don’t understand retail.
Tim Sweeney’s complaint about Apple isn’t that the fee is too high but that he wants to charge that fee rather than Apple.
The iPhone is usually backward compatible, sold at a hefty profit each year, and has tens of thousands of games from more developers.
That's pretty disingenuous about Tim Sweeney. His main complaint on iOS is that there's no way around the App Store, basically that Apple blocks any app distribution methods besides their official App Store.
Apple clearly wants to take this to court, so if the EU actually accepted it, it would constitute a failure on their part to be sufficiently maliciously compliant. And the EU is not going to start making a bunch of off the cuff public statements that Apple could take advantage of later - their response will be thorough and by the book.
It's probably true that the EC had gotten information on Apple's plans in advance, and wasn't surprised by it. That doesn't mean that they approve that plan. In fact, AFAIK it is impossible for them to have formally approved it. That's just not the process.
The EC will only start to consider whether Apple's implementation is compliant or not after the DMA enforcement starts, and will take into account feedback from the industry on what actually got implemented.
What Apple announced is irrelevant, the announcement is non-normative and such an announcement is really only for Apple's benefit (for them to get an idea in advance on how acceptable the industry finds their proposal, and course correct). But obviously Apple has no interest in that. The only use they have for the feedback is to print it on some special toilet paper rolls to use in the executive bathrooms.
You want that why not create competition by strengthen Android. Cheaper, sideloaded and even must have alternatives in App Store and payment. Go there.
Theoretical counterexample: “Introducing the Facebook App Store for iPhone users; now the only way to get Facebook.app/WhatsApp/Instagram on your phone, and without any of that pesky app tracking transparency.”
———
(As a disclaimer, I’m personally strongly in favour of side-loading, but I recognise how this will make things worse overall for everyone else)
That could still be maintained with side-loading though?
If the side-loaded app wants access to the GPS location, then the only way to get it is though the OS Location API which is what presents the Permission Dialog.
The same goes for any other permissions.
As part of the side-loading, any permissions that will be requested within the App could be presented to the user by the OS.
The first-half: a declaration of requested sandbox permissions is a technological problem with a straightforward solution, while the second-half is a soft, squishy, "human" problem.
At the same time, malware still manages to sneak into the Apple app store.
The walled garden gives a false feeling of security while at the same time placing in bondage all those even vaguely connected to the platform.
However, Apple playing both sides by saying the App Store is beneficial for users and also requiring a large % from developers doesn't sit right with me.
Amazon Shopping has been on the Play Store from at least 2014 onwards [1].
[1] https://play.google.com/store/apps/details?id=com.amazon.mSh...
And you have the real world where Facebook did not demanded Android users to enable side loading to install their application, so this is FUD.
The level of paternalism is also a positive feedback loop. The more paternalistic we are, the more we need to become because people rely on the guardrails and never learn about the danger. Then at some point they climb the guardrails, assuming that if it was dangerous to climb the guardrails then they would be bigger and less penetrable, more signs and padlocks, etc. So then we make the guardrails bigger. Rinse and repeat ad finitum.
With santioned App Store, such fishing attempts will fail. And 18 years of continued history proved that the Apple approach works. The iPhone IS the most secure device for the mass consumers.
Yes, I probably will miss my choices. But if that’s a problem, I’ll probably just buy an Android. Or better a fairphone.
But I want a locked digital forest to safeguard my privacy and digital assets. I can experiment with my PCs and other devices. That’s also my choice.
The app sandbox, watchdog and entitlements system is still in place in this scenario, how is their phone “doomed”?
There’s more android malware on the web than windows malware, by a significant margin. Almost an absolute majority of malware in total.
Bigger malware rate than windows isn’t an issue?
Meanwhile iOS sitting at <1% of total malware.
2 Malware was found on the AppStore
3 Fishing and scamming does not need an app, to fix this you need to educate people.
4 The phones can be secured by default. If you are an "admin" for you familyu then you can keep the "unlock" keys so they can't open the gates.
I can visit any website in Safari and expect to be safe, why can't the same be true of apps?
O they absolutely will. There will be apps that are only available via side loading. These are apps that either a.) would otherwise be forced to comply with the user protections provided by apple's walled garden or b.) wouldn't have a viable business model and wouldn't exist to begin with.
On Android, there is usually a setting to allow apps from different sources and additional permissions, you can enable per app (e.g. a permission for Apps to install other apps, which is for example needed by F-Droid).
Also this is not about preferences, but about anti competitive behaviour. Nothing will be taken from you. If you prefer the Apple ecosystem as is, you can keep using it as before, but Apple's competitors should get a fair chance to provide an alternative experience on iOS.
What I would worry about more is that someone will help them with the process and they won’t understand the implications – even ignoring the direct scams, an awful lot of family PCs were loaded up with ad/mal-ware due to a grandkid, friend from church, tip from someone they read, etc. I’d especially worry about it going like browser extensions have where someone installs something when it’s not bad but then the original developer sells it for whatever reason and a subsequent owner is more exploitative.
I think the idea of limiting the stores is a good one but it should be regulated like a physical store rather than run by Apple: require the operator to maintain a legal presence with identified executives, get audited for privacy, respond to complaints, etc. That wouldn’t stop Facebook but it’d at least block the lower tier of scammers and make enforcement of privacy laws possible.
the text that shows up in the browser console on Facebook.com and other major domains says that you’re wrong.
non-technical users are absolutely capable of copy/pasting some bypass code into the console etc and sending off their credentials to whatever attacker, happens every fucking day
Apple is anti-competitive and practically hostile towards developers so this is not a IPhone vs Android issue. So the "Go back to where you came from" rhetoric does not work.
> Android devices are nearly fifty times more likely to be infected by malware than Apple devices, revealed Nokia’s latest threat intelligence report. According to the whitepaper, Android devices were responsible for 47.15% of the observed malware infections, Windows/ PCs for 35.82%, IoT for 16.17% and iPhones for less than 1%. We’ve compiled a list top three reasons that explain why almost half of all malware-infected devices are running the Google-created platform.
https://www.pandasecurity.com/en/mediacenter/android-more-in...
As far as I understand the DMA, this is false. The DMA requires companies to allow sideloading OR alternative marketplaces, but it doesn't explicitly require both. Apple chose to allow the latter without allowing the former. We will see whether EU regulators agree with this interpretation and will let this stand. Considering how the GDPR is being enforced (they're going after Meta for daring to offer a free service while completely ignoring all the clearly illegal cookie banners with no dismiss button), I suspect no.
Apple is insisting that marketplaces have a form of accountability.
The alternative is Apple in an effort to maintain their profit margin sell some Euro-locked version of their phone that costs 50% more and that fewer people will be able to afford
The commission payment structure makes the device affordable/accessible to more people
That is a weird conclusion, unless you think that reducing the profit margin would not give the same result.
When the profit margin is high it is an indication of an inefficient market. If the market would have been efficient competitors would have gotten in when they see the opportunity for making good money.
This is a way to create an efficient market.
Think you can run the App Store better than Apple can? Show me one with equivalent quality available on Android.
The talk about "infringement proceedings" reveals why they have no power. If Apple is doing something against the law, ban the sale of their devices today then.
Here is just one example that I saw within 10 seconds:
> Curiously, Apple claims that “sideloading is one of many reasons why in the EU, the DMA’s changes will result in a system that’s less secure than the model we have in place in the rest of the world,” and uses this as an excuse to introduce a host of controls that will obfuscate its obligations under Article 6(4) the DMA.
the sovereign is able to change the rules of the game
this is not a war Apple can win over the long term
in the US stalling until a change of leadership might work, but in the EU it's universally accepted across the political spectrum that the US tech giants need reigning in
The EU should be asking themselves more why they have never created any significant platform of value, rather than trying to hijack the wealthy platform that apple has created so they can force them to be like android.
I live in the EU by the way. There are so many things about life here that are great, but there are a lot of things that the EU is ignorant and bad at. They should actually be regulating Google/Play store not forcing Apple to the lowest common denominator.
And you know that the only reason why they're doing this is Spotify anyways. Virtually no Apple customers care about having alternate app stores, and those who do should just get an Android.
The real reason why they are doing this is they want the wealthy platform that Apple has created, while at the same time being totally incapable of understanding what made it wealthy to begin with: trust. You don't have to worry as a consumer about apple stuff, because you trust that it will be alright. That's why Apple customers pay a premium, to not care.
The alternative is actually the default. Literally all other platforms are freemium, ad-sponsored techno-dystopias. You are given everything for free while there's a race to hack people's brains and turn them to mush, because the only value in such a system is ads and selling people's information. Nobody buys anything because it's a crap platform. The web and android I mean.
So, yes, Europe can and will make Apple comply, but they're going to kill the golden goose in the process by ruining what makes the platform valuable for people. They will probably never even understand why, because this isn't really the EU's core competency.
If Apple were HQ'd here it would be a totally different story btw.
They're working on that :)
https://en.wikipedia.org/wiki/Cyber_Resilience_Act
>The EU should be asking themselves more why they have never created any significant platform of value
There was Nokia Meego, which was arguably better than both iOS and Android at the time. (The Nokia N9 is still one of the best smartphones I've ever owned). But it's hard to fight against software platform effects where the largest provider takes over the entire market.
Apple said from the start of Lightning (which was and is heads and shoulders above micro-USB) that they planned for it to last as long as the 30-pin connector and it did. People complained when we went from 30-pin to Lightning and they complained when Apple went from Lightning to USB-C.
As a tech nerd I wish they had moved the phone (or at least the Pro version) to USB-C sooner but I understand why they didn’t. You all act like we had to be “saved from Lightning”, regular people don’t care, they liked Lightning, I liked Lightning. Micro-USB is trash, I can see wanting to escape that hell, Lightning wasn’t a problem for the vast majority of people.
And before “but they made money off MFI”, I don’t care. It was a drop in the bucket revenue-wise for them and meant that your Lightning cables has a minimum standard they would be held to. Something I can’t say for my other cables.
The little heatshrinked part near the connector is very clearly designed to fail, and I've seen so many lightning cables fail there after just 6 months.
Meanwhile my Oneplus 3t USB cable that I've been using even after moving on from that phone has only frayed this year, but still works.
This might vary from country to country, depending on how exactly each EU member implemented it, but where I live, you didn't have to ask permission for cookies related to core functionality (e.g. basket state in a webshop). IIRC you were even able to get away with light tracking, if it supported your main usecase (e.g. counting product views to generate a list of most viewed products) and didn't expose the data to a 3rd party service.
But yeah, it's much easier to keep sending all the user data to Google Analytics and complain about the EU forcing you into spammy cookie consent windows then it is to understand what the legislation is trying to achieve and reduce the amount of data you're collecting.
The only thing that stupid rule achieved is to make the web ever so slightly annoying to use.
If you don't think there's a problem with that (and the inevitable leak of those tens of thousand of collected biometrics within a couple years), then you probably can't see what GDPR really is for.
Build your own iPhone(EU-Phone) and sell it then. It's 18 year old technology, can't be that hard.
Build a competing app store. I won't listen to these regulators unless they prove they can do a better job themselves.
Surely your shareholders can do without the third largest market.
[1] https://www.theverge.com/2020/4/3/21206400/apple-tax-amazon-...