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Comment by slver | Hacker News Reader

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slver

Let's take a step and ponder wouldn't you find it bizarre to have this sequence of events:

1. Apple creates iPod, and iTunes serves as its music store.

2. Apple creates iPhone, which has an iPod app.

3. Apple introduces App Store so other apps can be used on the iPhone.

4. iPod (Apple Music) competitors emerge.

5. EU says "that's it, Apple can't have iPod anymore on the phone unless iPod (Apple Music) becomes a separate company".

No one (successfully) sued Apple for anti-competitive practices on iPod. Ergo if the iPhone never had an App Store, they'd be allowed to have 100% of the revenue of iTunes, and ban competitors out completely.

By opening the iPhone platform to third parties, EU sees them as another type of entity completely. In effect the EU penalizes the creation of market places, because once you're market place, you lose control over your own products to the government.

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Apple didn't invent music players, nor appstores, nor smartphones, nor digital music or music streaming. The entire argument is a red herring.

But even if we take this absurd argument at face value, it's still wrong: third party applications add value to iPhone and make them worth bying. If you could not install games, bank app, etc. On an iphone, iPhones would be useless and noone would buy them in the face of competition. The whole reason Windoes Phone died is that there were no apps. iPhone would simply follow

Third party apps have been dominant on PCs and Macs on the open web for a decade prior to the iPhone. Third party apps such as FB.Connor even Spotify.com still run on the iPhone built on HTML5. Of course, I will concede that the desktop publishing industry and the banking, finance, spreadsheet industries benefited from native computer apps in the decades prior to that.

Counter to the narrative of Windows phone’s failure, why were BlackBerry and Nokia successful despite not having third party apps at the scale iPhone does?

Third party apps add value to the iPhone — you’re right. They can also add confusion, adware, and bundleware if allowed to reign free; a curated, expensive gatekeeper is the cheap way to keep the crappy third party apps out; not a foolproof way, just a cheap way.

> "why were BlackBerry and Nokia successful despite not having third party apps at the scale iPhone does?"

They were in the process of dying around the same time as Windows Phone was and all for the same reason: the iOS/Android duopoly.

> No one (successfully) sued Apple for anti-competitive practices on iPod

Because they never had the market share and power in the music market that they have now on the mobile market that's why. You kind of answered why they are getting sued now yourself.

You're in effect saying "no, EU didn't sue iPhone because it added an App Store to iPhone, it sued iPhone because it was successful".

Is that better? Become successful, get sued? Android has 87% market share, iOS has 13%. That's not even a monopoly.

Of course we can define arbitrary categories like "Apple has monopoly on the iOS market". Which makes the concept of monopoly absolutely nonsensical, because then everyone has a monopoly. I have a monopoly on the slver username on HN, so I guess EU might sue me any moment now.

Also, let's recall EU suing Microsoft and forcing them to offer Windows without a media player. So what did this result in? It resulted in lots of nephews children and grandchildren having to visit their relatives and help them install Windows Media Player. I'm from EU and I want to like all their decisions, I'm team EU. But they're complete idiots sometimes when dealing with tech.

What a moot argument, there's absolutely zero competition in the mobile market. The living proof of that is that the only tariff changes Apple ever made in their whole mobile history was because ... of a real threat of an anti-trust lawsuit. They basically admitting the fact themselves, you can't even make this up.

Yes it's a duopoly and yes they are both abusing their market power. It got so bad that you have to get testimonials of mobile developers anonymously against those two companies because they are fearing retaliation against them (yes that does sound like a mafia).

> The living proof of that is that the only tariff changes Apple ever made in their whole mobile history was because ... of a real threat of an anti-trust lawsuit.

Not only that, this change highlighted the App Store and Play Store cartel[1] that engages in price fixing[2]. Google also dropped their prices to match Apple's, but not any more or less.

Instead of mobile app distribution prices being dictated by the free market, they're dictated by the cartel. Prices have only changed once in a decade, and not in response to the market at all, but by the whims of the app store cartel.

[1] https://en.wikipedia.org/wiki/Cartel

[2] https://en.wikipedia.org/wiki/Price_fixing

All these laws are not about "monopolies", that is just the wording people commenting use. So, yes the "concept of monopoly" is wrong here, which is why nobody is actually doing that and you are attacking a strawman.

Note: back in the iPod days, iTunes did serve as a music store for the iPod, but you could buy MP3 files from other providers as well, and transfer them to the iPod via iTunes. This whole process didn't "cost" the provider or user any extra.

Now, it's true that iTunes did get significant traction because of convenience for users of iPods, however there were definitely options for other music distributors. In fact, back in those days, I tended to still buy CDs because they were DRM-free and similarly priced, and I could rip the songs at my selected quality settings to transfer to my iPod.

If Apple never had an App Store, then this wouldn't be a problem, true. There would be no "30% cut for almost nothing".

But would people buy as many iPhones if they were restricted to Apple-only services? Some might. I would expect more people would buy into more "open" ecosystems. I could be wrong -- and Apple has every right to shut down their App Store to find out.

> In effect the EU penalizes the creation of market places

Nope. EU only forces you to compete in the marketplace on the same terms regardless of who owns the marketplace or the product.

> because once you're market place, you lose control over your own products to the government.

This is bog standard anti-trust. Yes, if you become massively successful, in a market, then you are now no longer allowed to do certain things. That is how anti-trust law works.

If you take over a market, or become massively successful, you become a monopoly/duopoly, and have to follow certain laws.

These laws aren't hard to follow though. You just have to allow competitors to use your stuff, and you can't use your market power against them.

>In effect the EU penalizes the creation of market places, because once you're market place, you lose control over your own products to the government.

Operating a marketplace generates billions for Apple, and without the Apple Store I doubt the iPhone would have any value today. This comes with legal duties. Apple can't do whatever with their marketplace, but must compete fairly within it.

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