Apple insists App Store 'not a monopoly,' expects to win in court

Posted:
in iPhone edited May 13
Apple held firm on Monday after losing a U.S. Supreme Court ruling over the App Store, maintaining that it's "not a monopoly" despite no third-party sources for iOS apps.

iOS 12 App Store


"Today's decision means plaintiffs can proceed with their case in District court," the iPhone maker told CNBC. "We're confident we will prevail when the facts are presented and that the App Store is not a monopoly by any metric."

Earlier today the Supreme Court ruled 5 to 4 in favor of permitting a lower-court lawsuit, Apple v. Pepper, to proceed. The vote was split, but not along party lines. Conservative Justice Brett Kavanaugh agreed with liberal justices that the case should go forward.

"Apple's line-drawing does not make a lot of sense, other than as a way to gerrymander Apple out of this and similar lawsuits," Kavanaugh wrote in his majority opinion.

Beginning in 2011, the plaintiffs have argued that app prices are artificially inflated by the fact Apple will only allow sales through the App Store -- where it takes 15 to 30% from every transaction. Some developers have indeed raised App Store prices higher than elsewhere, such as Spotify, which recently filed a complaint with the European Commission over the same issue.

Apple argues that developers are the ones who set prices, and that it's not in violation of any antitrust laws. It moreover claims that by paying its commission, developers are "buying a package of services which include distribution and software and intellectual property and testing."

"We're proud to have created the safest, most secure and trusted platform for customers and a great business opportunity for all developers around the world," the company continued in Monday's statement. "Developers set the price they want to charge for their app and Apple has no role in that. The vast majority of apps on the App Store are free and Apple gets nothing from them. The only instance where Apple shares in revenue is if the developer chooses to sell digital services through the App Store.

"Developers have a number of platforms to choose from to deliver their software - from other apps stores, to Smart TVs to gaming consoles - and we work hard every day to make sure our store is the best, safest, and most competitive in the world."

Critics have argued however that while people can choose to switch to other platforms, those who already own an iPhone or iPad are stuck with the App Store on it unless they hack their device in a way that invalidates Apple support.
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Comments

  • Reply 1 of 69
    apple ][apple ][ Posts: 8,691member
    The vote was split but not along party lines, with even Republican Justice Brett Kavanaugh acknowledging the case should go forward.
    Kavanaugh was the only one and he was joined by 4 liberals.

    The court's four liberal justices joined Kavanaugh in the 5-4 decision.

    https://www.cnn.com/2019/05/13/tech/apple-app-store-supreme-court/index.html
    AppleExposedcornchip
  • Reply 2 of 69
    As I mentioned in another thread, there’s nothing illegal about having a monopoly (in the US). Abusing monopoly power is where corporations run into trouble.

    Even if it can be proven that the App Store has a monopoly, which I think will be difficult for obvious reasons, how is Apple abusing that power?
    edited May 13 StrangeDayslolliverjbdragonn2itivguysarthoscornchip
  • Reply 3 of 69
    pacificfilmpacificfilm Posts: 127member
    apple ][ said:
    The vote was split but not along party lines, with even Republican Justice Brett Kavanaugh acknowledging the case should go forward.
    Kavanaugh was the only one and he was joined by 4 liberals.

    The court's four liberal justices joined Kavanaugh in the 5-4 decision.

    https://www.cnn.com/2019/05/13/tech/apple-app-store-supreme-court/index.html
    I’m not understanding your post. What AI wrote is the same thing you wrote. 5-4 vote, not on party lines as Kavanaugh acknowledged the case should go forward. 
    chemenginStrangeDayslolliver
  • Reply 4 of 69
    apple ][apple ][ Posts: 8,691member
    I’m not understanding your post. What AI wrote is the same thing you wrote. 5-4 vote, not on party lines as Kavanaugh acknowledged the case should go forward. 
    The breakdown of the other votes wasn't clear, so I provided it.

    When I first heard about this story earlier today, besides Kavanaugh, I didn't know which side the other judges were on, and now I know.


  • Reply 5 of 69
    genovellegenovelle Posts: 978member
    These cases make me super annoyed. Is Walmart or Amazon for that matter required to make my product or service available and promote it in their stores for me for free. The both have products and services they created and sell. Of course not. It would be stupid for me to expect that since they are for profit entities. There are a multitude of benefits for developers to be on iOS. Many times Apple was forced to create a product because what is available was subpar or lacked consistent support for their platform. Especially in cases where a partner turn on them to become a competitor and holds features back from the product Apple helped them create. Google Maps and Microsoft Office are perfect examples of this. Then all of a sudden, they want to jump back to developing. I use Apple Maps consistently and have seen it improve immensely. Google had the head start for Mobile Maps because of the data they got from the IPhone. The more we use it the better it gets.  
    pscooter63lollivern2itivguysarthos
  • Reply 6 of 69
    knowitallknowitall Posts: 1,450member
    As I mentioned in another thread, there’s nothing illegal about having a monopoly (in the US). Abusing monopoly power is where corporations run into trouble.

    Even if it can be proven that the App Store has a monopoly, which I think will be difficult for obvious reasons, how is Apple abusing that power?
    By taking a 30% cut and not allowing other means of app distribution.
    Apple should ask for a fixed amount for a fixed set of ‘services’ needed to run the store.
    As I mentioned before, apps can be signed by Apple (after some sanity and virus checks) and distributed via any digital means. App developers can put the apps on their home page (or whatever) and pay apple a few cents for signing only and skip the hosting fees. This adds the benefit of even better visibility for the app because Google can find it directly.
    chemengin78BanditAppleExposedcroprCarnage
  • Reply 7 of 69
    NotsofastNotsofast Posts: 431member
    knowitall said:
    As I mentioned in another thread, there’s nothing illegal about having a monopoly (in the US). Abusing monopoly power is where corporations run into trouble.

    Even if it can be proven that the App Store has a monopoly, which I think will be difficult for obvious reasons, how is Apple abusing that power?
    By taking a 30% cut and not allowing other means of app distribution.
    Apple should ask for a fixed amount for a fixed set of ‘services’ needed to run the store.
    As I mentioned before, apps can be signed by Apple (after some sanity and virus checks) and distributed via any digital means. App developers can put the apps on their home page (or whatever) and pay apple a few cents for signing only and skip the hosting fees. This adds the benefit of even better visibility for the app because Google can find it directly.
    Thankfully, the law doesn't run according to what you feel a company should charge.  We let supply and demand in a free market decide.  Under your model, Ebay, Amazon, Etsy, Google, etc., all would be prevented from charging commissions.  It's alarming that so many folks think the way it works is that a person or company should be able to decide they want to get in the app business and want to support iPhones, but they should be able to decide they don't like the fees charged.  LOL, then don't decide to make an iOS app. Just like someone deciding they want to make a product for Walmart to sell, but then when Walmart lets them know they are going to only get half of the sales price, the person cries "unfair."  LOL. 


    pscooter63StrangeDayslolliverjbdragonAppleExposedn2itivguysarthoscornchip
  • Reply 8 of 69
    ElCapitanElCapitan Posts: 265member
    It is not a traditional monopoly in the overall market, but it is a monopoly for distribution of apps in the iOS, tvOS and watchOS ecosystems.

    Actually I would not even care if the monopoly gave equal access to all interested parties, but it don't. 

    What is much worse is that Apple also upholds a cultural monopoly for their ecosystem, not only in the US but also across the other countries in which they market their products. 
    Apple tries to police an oddball mix of US CA political correctness, their management's personal political viewpoints (which often is completely irrelevant outside the US), Apple human policies, the typical left leaning slant of Silicon Valley and US legislation, many times at direct odds with legislation and culture in the country they market their product in

    This do not hold water over time for a company wanting to be global, but is unfortunately typical for US companies operating outside the US.
    I don't think this particular case with the Supreme Court in the US will change it much. What I do expect is that Apple will have a much harder time in a European court and with the EU on the issue of the App store.
    edited May 13 AppleExposed
  • Reply 9 of 69
    SpamSandwichSpamSandwich Posts: 31,396member
    Keep in mind that just because Kavanaugh agreed with the Left-leaning SCOTUS judges to hear this case, that does not mean Kavanaugh will reach the same conclusion.
    chasm
  • Reply 10 of 69
    ralphieralphie Posts: 13member
    genovelle said:
    These cases make me super annoyed. Is Walmart or Amazon for that matter required to make my product or service available and promote it in their stores for me for free. The both have products and services they created and sell. Of course not. It would be stupid for me to expect that since they are for profit entities. There are a multitude of benefits for developers to be on iOS. Many times Apple was forced to create a product because what is available was subpar or lacked consistent support for their platform. Especially in cases where a partner turn on them to become a competitor and holds features back from the product Apple helped them create. Google Maps and Microsoft Office are perfect examples of this. Then all of a sudden, they want to jump back to developing. I use Apple Maps consistently and have seen it improve immensely. Google had the head start for Mobile Maps because of the data they got from the IPhone. The more we use it the better it gets.  
    You just proved the whole case. You have a choice of Walmart or Costco, etc. with iOS the developer has NO choice.
    chemenginAppleExposed
  • Reply 11 of 69
    apple ][apple ][ Posts: 8,691member
    ralphie said:with iOS the developer has NO choice.
    They have the choice of not developing any apps for iOS. Nobody ever forced anybody to make any iOS apps.
    georgie01lkrupplolliverAppleExposedn2itivguysarthospscooter63cornchip
  • Reply 12 of 69
    AppleZuluAppleZulu Posts: 534member
    The basic argument underlying this case - that Apple has injured consumers by inflating app prices - is just incorrect. Prior to Apple's introduction of the App Store, computer applications were generally much more expensive. By creating a single, trusted source for iOS applications, Apple actually drove prices down, not up. The iOS developer system makes sure that programs follow a common intuitive user interface, which eliminates the need for instruction manuals and documentation, which cuts costs for developers and increases willingness of users to try new apps. The fact that programs are sandboxed and vetted by Apple also lowers consumer risk for buying malware, which again lowers consumer risk to try new apps. Both of these factors lead to the opportunity for developers to sell their programs in significant volume, which allows for the commonplace pricing of apps at 99 cents or maybe a few bucks. That inexpensive pricing structure itself drives consumer willingness to try new apps, which in turn drives volume. The App Store also eliminates the need for developers to manage a retail infrastructure, which lowers the developer's costs and risk for creating something and putting it out there to see if anyone will buy it. This, in turn drives down prices for apps. 

    All this is worth the overhead that Apple charges for selling apps through the App Store. Were Apple to open up the system to outside sales and installation of apps, the alternatives would not drive prices down. An entirely independent developer selling their app through their own website would be hard-pressed to generate volume sales, because consumers would have to find them first, and also be convinced that the application isn't loaded with malware. They would also have to develop and maintain a sales and customer service back-end. That won't drive down prices. Without high volume sales, developers would have to charge more just to recoup the cost of development and overhead. That won't drive down prices. The other alternative, selling through a large third-party app store, run by Amazon, or Google, or BestBuy, or whoever, would be subject to the retailer taking a cut to cover their overhead. That won't drive down prices. The truth of all this is borne out by the fact that Android apps aren't any cheaper than iOS apps.

    So the argument that the App Store injures consumers by inflating prices is specious. The argument that the App Store is a monopoly is also bogus, because you can bypass the whole thing by buying an Android phone and load it with whatever bloatware and malware apps you care to buy. 
    foregoneconclusionStrangeDayslolliverAppleExposedn2itivguysarthospscooter63cornchip
  • Reply 13 of 69
    georgie01georgie01 Posts: 263member
    ralphie said:
    You just proved the whole case. You have a choice of Walmart or Costco, etc. with iOS the developer has NO choice.
    Apple isn’t trying to eliminate competition or even (directly) remove choice. Are you perhaps too young to remember that Apple didn’t even want to provide developers with a means to develop apps for the iPhone initially?

    That was for security reasons, and that’s the primary reason the App Store is the only means of app distribution.

    Some of the people who are fighting Apple’s approach maybe believe they have a noble cause, but all that will happen if they’re successful is to weaken the security of users’ devices and hurt Apple’s image (as nefarious apps end up on unsuspecting users’ devices). And Apple should make their devices less secure so that a small percentage of users can save a few dollars? How asinine.

    Apps are so cheap, thanks to Apple. Or are you also too young to know how much software used to cost before the App Store?
    StrangeDayslolliverAppleExposedn2itivguyflyingdpsarthospscooter63kurai
  • Reply 14 of 69
    canukstormcanukstorm Posts: 1,970member
    ralphie said:
    genovelle said:
    These cases make me super annoyed. Is Walmart or Amazon for that matter required to make my product or service available and promote it in their stores for me for free. The both have products and services they created and sell. Of course not. It would be stupid for me to expect that since they are for profit entities. There are a multitude of benefits for developers to be on iOS. Many times Apple was forced to create a product because what is available was subpar or lacked consistent support for their platform. Especially in cases where a partner turn on them to become a competitor and holds features back from the product Apple helped them create. Google Maps and Microsoft Office are perfect examples of this. Then all of a sudden, they want to jump back to developing. I use Apple Maps consistently and have seen it improve immensely. Google had the head start for Mobile Maps because of the data they got from the IPhone. The more we use it the better it gets.  
    You just proved the whole case. You have a choice of Walmart or Costco, etc. with iOS the developer has NO choice.
    The developer can choose iOS, Android, Windows, Linux, macOS
    StrangeDaysanomelolliverAppleExposedn2itivguysarthospscooter63
  • Reply 15 of 69
    larryjwlarryjw Posts: 417member
    Every middleman, distributor has to charge for their services. One may think 30% is too high but that doesn’t make it illegal nor should it. 

    Apple makes the developer set the price. That’s little difference from, say Macy’s, marking up the price of their items from their suppliers. 

    You know, realtors get commissions as a percent of home price. 
    lolliverAppleExposedn2itivguysarthos
  • Reply 16 of 69
    AppleZulu said:
    The basic argument underlying this case - that Apple has injured consumers by inflating app prices - is just incorrect. Prior to Apple's introduction of the App Store, computer applications were generally much more expensive. By creating a single, trusted source for iOS applications, Apple actually drove prices down, not up.
    Apple's interest in creating the Apple Arcade is specifically the result of this dynamic. Freemium apps dominate the App Store. The antitrust part of it for consumers...how can that even work if premium priced apps are a minority of what consumers actually download?
    n2itivguy
  • Reply 17 of 69
    If Apple were to lose this case does that mean Sony, Microsoft, and Nintendo will be required to have other means of digital software distribution on their platforms (PS, Xbox, Switch) as well? For all you people thinking this is a monopoly, you might want to actually learn what a monopoly is first. 
    lolliverAppleExposedn2itivguysarthoskurai
  • Reply 18 of 69
    StrangeDaysStrangeDays Posts: 8,546member
    ralphie said:
    genovelle said:
    These cases make me super annoyed. Is Walmart or Amazon for that matter required to make my product or service available and promote it in their stores for me for free. The both have products and services they created and sell. Of course not. It would be stupid for me to expect that since they are for profit entities. There are a multitude of benefits for developers to be on iOS. Many times Apple was forced to create a product because what is available was subpar or lacked consistent support for their platform. Especially in cases where a partner turn on them to become a competitor and holds features back from the product Apple helped them create. Google Maps and Microsoft Office are perfect examples of this. Then all of a sudden, they want to jump back to developing. I use Apple Maps consistently and have seen it improve immensely. Google had the head start for Mobile Maps because of the data they got from the IPhone. The more we use it the better it gets.  
    You just proved the whole case. You have a choice of Walmart or Costco, etc. with iOS the developer has NO choice.
    Nope, because as the supplier/wholesaler you are free to sell to other retailers — Google
    app store, Samsung, etc. 

    Same as in brick and mortar. 
    lolliverAppleExposedn2itivguysarthospscooter63
  • Reply 19 of 69
    mjtomlinmjtomlin Posts: 1,999member
    ElCapitan said:
    It is not a traditional monopoly in the overall market, but it is a monopoly for distribution of apps in the iOS, tvOS and watchOS ecosystems.

    A "traditional monopoly". It's either a monopoly or not. Owning something does not make you a monopoly it makes you the OWNER of it. It's Apple's platform, they OWN it. It has NEVER been an open development platform nor an open app distribution platform... EVER. Apple owns the developer tools and they own the OS, if they choose to own the distribution model that's absolutely within their right.

    No one has to open their operating system to development and it's ludicrous to think that. Could people develop apps for the iPod? No. It was a closed platform. Apple did let a few developers write games for it, but that was it. iOS is NO different than that other than Apple has opened the doors to more developers, but they still have absolute control over the development and distribution of apps for the platform.

    Saying Apple can't own and control any part of that is the same as saying Apple cannot tie their hardware and their operating system together, because people want iOS, but don't want to pay Apple's prices for their hardware. Well, tough sh!t. That's the PRODUCT Apple is selling. You don't like it, buy a different product.

    There is no way, this is going win, doing so, means any product from any company on the market can be forced into breaking it apart and letting others in.
    lolliverAppleExposedsarthoswd4fsupscooter63
  • Reply 20 of 69
    StrangeDaysStrangeDays Posts: 8,546member
    larryjw said:
    Every middleman, distributor has to charge for their services. One may think 30% is too high but that doesn’t make it illegal nor should it. 

    Apple makes the developer set the price. That’s little difference from, say Macy’s, marking up the price of their items from their suppliers. 

    You know, realtors get commissions as a percent of home price. 
    Yup, and having sold and distributed my products in national retail I can assure you the distributors and retailer take/add more than 30% of my wholesale cost to them. Furniture is usually 100% markup. 
    lolliversarthos
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