DoJ's probe into Apple expanding beyond music - Page 2

Totally different situations. Apple has no market power at all in the computer OS market.

Zilch.

But they might be found to dominate the mobile app retail market. That is more likely.

But what fun is that?

This, and a whole lot more. What the antitrust case against Microsoft exposed was Microsoft's argument that they could legitimately add anything to Windows without harming competition. Steve Ballmer was famously quoted as saying that they could "add a ham sandwich to Windows" if they wanted to. Essentially, they were defining innovation in terms of their ability to snuff competitors at will by leveraging Windows in any way they liked. This fairly shocking argument was rightly interpreted by the DoJ and the courts as a complete disregard for the laws on competition.


QFT. However, I'm confident that Apple is not so arrogant and stupid that if the DoJ determines that a practice is questionable that they won't modify it voluntarily.

Ask Bill Gates and Steve Ballmer. I imagine that over drinks they still moan about how they were treated so unfairly by the government.

Thanks.

It was a typo. But when I went to correct it, I realized the double meaning, and left it alone. I'm glad to know it was understood.

Easily. In fact this argument was made quite often by the technorati during the '80s and '90s, that competition in the technology industry was not only unnecessary, but even a bad thing. A bizarre argument.

It is a thing not so much to be understood, as pondered.

Wouldn't the movie industries pressure on Netflix, where they forced them to wait a month after a DVD release before offering it to netflix subscribers amount to much the same behavior as Apple is being accused of here? Also, haven't they they trying to shut down the redbox movie rental kiosks (or force a similar deal on them as they did on Netflix?) Seems that Hollywood would want the whole thing to go away before they attract te attention of the doj.

Sure they do.

Get CS3 so Pshop will work natively on an Intel Mac, CS3 turns out buggier than both CS2 under Rosetta and the CS3 beta on my Mac Pro, now they say CS3 won't be supported on Snow Leopard. They charge more to upgrade from older versions, the quicker they push 'upgrades' out the door the quicker you cross that threshold into a more expensive upgrade.

+1 (....)

Hey, you lazy anti-government wannabees ... this is called an investigation into illegal activities. That is the job of the Fed. Look at the Constitution occasionally. Even Wall Street and Mom and Pop businesses need to know that possible improprieties will be checked out.

If the Feds overreach and play god, then sure, complain to high heaven, but being knee-jerk reactionaries carrying Glen Beck's water is pretty stupid.

Sincerely

Thomas Jefferson

Monopolies often form naturally, like the one enjoyed by Office. If the monopolist doesn't abuse the power, it can be argued that it is a good situation, as it was chosen freely by the public.

Most titles are still available via Netflix on day one. Also, for most of those studios where Netflix entered into an agreement to delay, Netflix was provided a larger catalog of movies/tv shows for instant streaming.

Are you fucking kidding me? Why don't you go ahead and tell that to every farmer and rancher in the early 1900s? Do yourself a favor and look up the American Industrial Revolution (specifically the creation of tycoons and their affects) and vertical integration. Apple now has their own proprietary chip. Pretty soon they will own the factories as well.

So what? Vertical integration in monopolistic?!

You need to learn some Econ 101.

I will have to defer to old Adam Smith on that subject:


Here as elsewhere, Smith makes it plain that monopolies are bad economics as they invariably make prices higher than they would otherwise be. They also stifle innovation, which is perhaps more of an issue for us today than it was in Smith's day. When "natural" monopolies occur, such as in public utilities, they are typically regulated, with the understanding that the free market response to them would be high prices and insurmountable barriers to entry.

Since the iPhone isn't a monopoly, won't be a monopoly and since Apple has a right to protect its business the Adobe thing will go no where. Way to go, Adobe¡ You've done nothing but weaken the world of technology by first being negligent with your technology and now being passive-agreesive toward Apple and your customers. Can you be anymore awesome?¡


Hold up! The iPad has been on sale for less than two months and only went on sale outside the US this past Friday, while the tablet market has been going for a decade, YET Apple already has a "monopoly with the iPad"?

If true, perhaps one should look into why the previous decade of tablet makers were so incompetent that a company could come in a decade later and drink their milkshake in 1/60th the time.


While their at it I love for them to look into the music labels first scoffing at Jobs' open letter to remove DRM, then offering it to Amazon but not to Apple.

Microsoft had a monopoly on a total category of devices (Personal Computer). MS Used its monopoly status to wipe out a competitorm- Netscape. At that time people were thinking that applications would run in the browser (container) and would make the OS irrelevant. Making IE the default browser and forcing OEMs (Dell, etc) to NOT include Netscape was deemed very anti-competitive for a company deemed a monopoly

Apple does not have a monopoly on music , video or smartphone development. They are not trying to wipe out Amazon with anti-competitive behavior (threatening not to carry the music if deals done with Amazon) The situations are totally different.

Of course, they need to increase their visibility, nothing worse for this administration than going 5 seconds without the complete attention of the media. And they need the money, beaurocratic surges with rainbow lollipop names aren't cheap. They're just licking their chops over anything Internet as a potential tax revenue stream. They'd love to have bigger cut of those iTunes sales, they're already taxing everything else to death.

And of course nothing is more important than going after the 30% share of the music industry sales that Apple commands. If the DOJ spent 5 minutes thinking this one through, 2 other facts would have torpedoed this stupid idea:

-iTunes has been the only growth sector of the music biz for almost a decade, the rest has been in sharp decline.
-You can load any other retailer's music into your Apple products.

I would ask you what you are talking about, but I presume even you don't know. I never mentioned vertical integration and would not have since it's got nothing whatsoever to do with anything I actually said.

As a Stumptown resident -- the mecca for recipients of government handouts, with one of the highest unemployment rates among major US cities -- it is not surprising that you espouse such a view.

Who is Glen Beck?

Really? I don't see it that way at all. I see it as a perfectly logical and intelligent (in a capitalist society) way of dealing with the situation. They fought, they delayed any decisions for 10 years. Along the way, did they suffer any business while this went on, mostly unbeknownst to the ignorant public? Hell no.

The best thing to do in this sort of situation is claim innocence and delay, delay, delay. That way they delay paying. That is a good thing for capitalist entities. They pay the lawyers regardless, and their objective was to keep it going, keep the feds off their backs and delay any decision.

It's the decision that is the stupidest. The decision should have been swift and it should have followed the AT&T breakup (2 companies - OS and Apps). Then the consumer and the industry would be benefitting from government intervention.

Of course what would torpedo the torpedoing of the investigation would be facts like:
-iTunes has ~70% of online music sales. You know, the market in question.
-The fact that you can load music from other retails onto Apple devices says little about Apple applying unfair pressure to help ensure the iTunes music store is that source. Apple 'allowing' music from other sources is simply survival. The iPod and iTunes store would have been dead in the water if iPods could only play Fairplay AAC. People would have bought alternatives if they couldn't play their pirated MP3s.
-Online music sales, led primarily by iTunes, has been the only sector of growth for the music biz for most of the decade. That doesn't mean other players in the market should be suffocated.

A great use of the DOJ's time and effort.
Thousands of songs, TV shows and movies continue to gush from a gaping hole in the ocean floor threatening to entertain thousands of miles of worth of pristine consumer electronic habits. This could be the worst multimedia spill in the world's history.
Who is at fault for this disaster?
The DOJ will investigate and bring them to justice!!!

I'll wait to see if the DoJ finds something. By the sounds of it, it's just a goose chase (or red herring). The DoJ will either find a couple of little things or nothing, is my guess.

As most have said, Apple does not have a monopoly in anything, be it smartphones, tablets (there are other tablets, believe it or not), music players, or computers. Apple does have a fair amount of power and influence in the consumer electronics field, but I have a feeling most of this is a backlash of the Flash War, in which Apple, Microsoft, Adobe, and others have an interest.

It followed a certain sort of logic of the kind you describe, but I think in the end, flawed logic. The most significant outcome of the case was Judge Jackson's Findings of Fact, which were used to power several huge private antitrust settlements, which cost the company billions. Then the EU got in the act. In retrospect, I think it's clear that Microsoft would have done themselves a big favor had they headed off this outcome by making relatively small changes in the way they did business. Few companies are so bull-headed in dealing with the government as Microsoft was.

Sure, it would have been better had the government acted more swiftly (ideally, with the original FTC complaint in 1992) but after that, the real delay was in the courts, which is impossible to do much about, especially given the complications in this case -- massive amounts of evidence, depositions, the need to appoint Special Masters, and that sort of thing.

I was never a big fan of the breakup plan. This would still have allowed the "OS Division" of Microsoft to leverage Windows, which was the cornerstone issue.

That's exactly the Flash issue in a nutshell. Adobe never delivered a product.

Apple should have simply said "Adobe has never delivered a version of Flash which works on the iPhone" and left it at that.


QFT.



OK. So what's the problem? If as people are arguing, Apple's not offering Flash on the iPhone is a bad thing, it helps the competition. If Apple's control of the development tools is a mistake, the competition will benefit. So why are people complaining? Apple's actions are going to HELP the competition if all the whiners are correct.


Nonsense. The law has always allowed for things like only offering advertising allowances if the partner complies with your rules. As long as you're not a monopoly and demanding better terms than anyone else, it's perfectly legal.

"... which is rapidly becoming the dominate force ..."

You mean dominant force.

I don't agree it's flawed logic. It's a risk they took, sure, but the logic is perfect in capitalism, and they had how many years of no change to their business practices, realising full revenue as a result? And, Netscape lost.

I wouldn't ever imagine a company admitting guilt, ever, especially up front. Capitalism demands they deny, obfuscate and continue on their current path. Though they didn't "win" in the end, I think they got off without much penalty at all.

My opinion is that I believe any company that resorts to unsavoury business practices to put a competitor out of business, should itself be shut down. No compromise and no flexibility here. Only then might you see these greedy bastardes acting in a way that I would consider to be heading in the direction of integrity (they will never get there in capitalism, but it'd be nice if they were at least headed in the direction of integrity).

It really comes down to Apple having a big wad of cash and politicians needing some of that for their campaigns. Microsoft didn't understand that connection in the 90s but now they do. Apple needs to open up their wallets a bit to deflect the DoJ. Obama will pull them in when Apple starts fanning cash at him.

The big difference is that MS was using their dominance (monopoly) in one market to gain dominance in another. Which is more often than not, done using illegal means. There is nothing wrong with using one's dominance in a market to gain or maintain that dominance in that same market. Which in most cases can be done without breaking any laws.

And let's not gloss over the fact that MS sabotage Netscape by encourging their developers to code using MS Java on their web pages and not making any changes in those codes available to Netscape, in a timely matter. So Netscape was always "buggy" when consumers used it.

BestBuy is the biggest electronic retailer and can "encourage" the companies they do business with all they want in order to get a better deal than Target. Target can strike exclusive deals so that certain products are only available at Target and not at WalMart. WalMart can chose not to sell a company "R" rated games but all of their "M" and "PG" games. Or all "XXX" rated movies. It doesn't matter that they are the biggest DVD and gaming software retailer.

All Apple did was to "inform" the Labels that if they let Amazon have certain music before Apple iTunes, then Apple would not feature or promote that music in their iTunes store. That's the same as WalMart not giving a certain product special shelf space or in store promotion if that product was first made available to Target. In no way did Apple threaten to stop selling all of the labels music or even the music that was made availble at Amazon first, if the label let Amazon have it first. Apple just wasn't going to promote or feature the music, Amazon got first, in their iTunes store.

If the labels thinks that they can make more money letting Amazon sell their music earlier than Apple on iTunes, nothing is stopping them from doing this. And in the end, their choice will be based on the way that makes more money.

The labels were the ones that gave Steve Jobs the key to the Kingdom. And it's now going to cost them if they want it back.

Too much is being made out of this.

Its just an investigation, and nothing will come out of it.

This is simply the Post doing what it does best. Sensationalizing trivial matters, and desensationalizing important stuff.

I know...The DOJ is so messed up! I really want to see any consumer protection outcome from their past actions. I am sure there might be some indirect results, but even those that I can't seem to recall. Waste of taxpayers money!

so lets let the most screwed up organization "US Government" tell the most successful corporation in America today how to operate. Wow are we messed up.

Eric Holder should investigate the governments subsidies to General Motors, the AIG dominance in the insurance industry, the SEC's ignoring of Bernie Madoff, but instead they refuse to acknowledge that Radical Islam is a problem and instead go after Apple Computer. I can buy an iPad device from several makers, and soon more. I can buy music from Amazon, Apple, etc. The current Justice Department is made up of bunch of Socialists and Communists.

I understand your argument, and I made it myself for the years the case slowly an agonizingly wended its way through the courts. It seemed to me then that Microsoft was benefitting from the delay, and in a way, they certainly did. But I find myself modifying that view when I look at the larger outcomes of the case, which I think have had a much longer term negative effect on the company. They invested so much of their corporate strategy on blatantly illegal practices, that even today they are finding it difficult to formulate an effective alternative. So even discounting for the Findings of Fact (which were huge and costly), Microsoft's inability to accept change has indeed hurt them.

When faced with these issues, companies don't need to "admit guilt," they simply need to agree to changes in their business practices, and move on. This happens all the time. You don't hear much about this because the complaints and investigations don't result in lengthy antitrust cases. They are rapidly and quietly resolved. I'd like to think that if the DoJ has questions about Apple's business practices, that the company won't be as pigheaded as Microsoft.

ya, probably right, gotta waste some more taxpayer dollars... jeesh i can't wait until we kick these bums out.

That is an interesting pint you make. On the surface it sounds pretty compelling. Once you look more closely at it, however, some important differences crop up.

The big thing is motivation. MS had its own product IE that was competing with Netscape. Now both were free so what was the issue? The issue was who was to control

1- the portal to the internet, and
2- access to the internet.

#1 was a monetary issue since access portals are monetized via advertising revenue.

#2 Was also very important. By making IE the default browser on 95% of computers world wide, MS was able to marginalize competitive Operating Systems (such as Macs and Unix of all flavors). By co-opting internet standards such as Javascript, HTML etc, they forced developers to program for their own, truly monopolistic platform - thus raising the "cost" of purchasing a competing computer. Believe me, in those days there were many many web sites that just would not work on a Mac, even with IE - not to mention that changes to IE would come out many months later on Mac than on PCs.

Essentially, IE vs Netscape was a battle for big $$ and market dominance.

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So how about Apple vs Flash?

Personally, I have trouble seeing a serious financial interest here. There are two parts to Flash issue - no Flash Player on iPhone OS, and not allowing Flash derivative programs on the platform.


It is hard to see how Apple is making money from refusing to allow Flash players. Flash players play content off the internet. Apple does not have a competing system of its own. It is merely pushing for adoption of Open standards. The reasons are two: First, quality (tons have been written so I will not say more), and second is that Apple does not want to be dependent on a third party for any key aspect of the user experience on its platform. (It was badly burned by the IE and MS Office experiences.) Is Adobe willing to make the player open source so that anyone can write a player app? Are they willing to make the Flash language open source so that the internet community as a whole can help refine it and develop programming environments for it? NO. They want to maintain their monopoly on the technology. This is fine - they bought the company who created it - but then Apple has a perfect right to cut it off if it damages their product.

As for the use of Flash development system to create iPhone products: Apple believes these are crappy. That is why they disallow them. Why? Do they make a great deal of money from a competing system? I don't think so. You can buy a used Mac Mini for $400 with the SDK built in. Then it costs a whopping $99 to be join their developers group. I hardly see this as a huge revenue stream.

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Actually, Apple is loosing money in this so-called "Flash war." One of the biggest excuses for not wanting to buy an iPhone or iPad is that it will not play flash.

So - I think there is really a huge difference between the two cases.

IMHO

Al Capone was very successful.

Bernie Madoff was very successful.

BP was very successful.

Roger Clemens was very successful.

Should we not pick on them?

Maybe you need to redefine the meaning of "success." Last time I looked, it didn't include cheating.