rogifan_new

randominternetperson said:

gatorguy said:

randominternetperson said:

payeco said:

GeorgeBMac said:

To me, this whole case involving the App Store is based on a lack of understanding:
-- If you look at the App Store as simply and strictly and only a market place then, YES! It is a monopoly.
-- If you realize that the App Store provides numerous services critical to well being of Apple, its products and its reputation, then you realize it is NOT a marketplace.

Allowing anybody to install anything on Apple products would make those products no more stable, reliable and secure than a Windows machine.   Apple's reputation for reliability, security and privacy depend on the App Store and, without it, both Apple and its developers will suffer immeasurable economic harm.  And, we the users will be deprived of a lone island of safety in sea of Googles and Microsofts.

That issue is irrelevant here. The law is designed to protect consumers and limit monopoly power, not protect a company’s reputation and/or business model.

On a personal level I agree with you. I think the exclusivity of the App Store protects the security and stability of the platform. On a broader level I can see the plantiff’s point as well. 

It's not irrelevant.  Courts can and do look at why companies do what they do.  A compelling business justification is a valid defense in an antitrust case.

Per https://www.ftc.gov/tips-advice/competition-guidance/guide-antitrust-laws/single-firm-conduct/monopolization-defined

Finally, the monopolist may have a legitimate business justification for behaving in a way that prevents other firms from succeeding in the marketplace. For instance, the monopolist may be competing on the merits in a way that benefits consumers through greater efficiency or a unique set of products or services. In the end, courts will decide whether the monopolist's success is due to "the willful acquisition or maintenance of that power as distinguished from growth or development as a consequence of a superior product, business acumen, or historic accident."

Here's Ben Thompson's take on the App store as having a monopoly position, take it or leave it. In a nutshell for those with zero interest in really reading about the why's:

"To put it another way, Apple profits handsomely from having a monopoly on iOS: if you want the Apple software experience, you have no choice but to buy Apple hardware. That is perfectly legitimate. The company, though, is leveraging that monopoly into an adjacent market — the digital content market — and rent-seeking. Apple does nothing to increase the value of Netflix shows or Spotify music or Amazon books or any number of digital services from any number of app providers; they simply skim off 30% because they can.

To be clear, Apple absolutely did create the modern app marketplace, and, as the company loves to brag, an entire new economy full of new types of jobs. That, though, is precisely the problem: the App Store is not a fun side diversion; it is one of the largest platforms we have ever seen, on which hundreds of thousands of people are seeking to build real businesses, and that carries different types of responsibilities — and legal limitations — than an OS feature. It is bad for society generally and, I strongly believe, illegal for Apple to have crafted App Store rules such that it can leverage its smartphone share into monopoly profits on digital goods and services that are on iOS not because iOS is anything special, but because that is the only possible way to reach nearly 50% of the U.S. population."

https://stratechery.com/2018/antitrust-the-app-store-and-apple/

I will disagree with Mr. Thompson about the chances of SCOTUS coming down on the side of Apple and dismissal, but on the larger case of Apple and monopoly he makes common sense arguments IMHO. 

Thanks for sharing that.  Is he right though?  I have a Netflix account (and others) and I watch lots of Netflix programming on my Apple devices.  And I've never paid Apple a dime for this digital content.  I subscribed through the Netflix website and Netflix gets 100% of their monthly fee.  If Apple is using it's market power in the device arena to gain market power in this other market, they aren't doing a very good job of it.  A better example would be if Apple didn't allow Netflix or Pandora on iOS in order to improve their market power in the media market.

I did the same as you re:Netflix but I’m sure the majority buy via IAP because of the convenience. Or because they don’t know they can go to Netflix’s website to sign up (not allowed to mention it or provide a link in app). In my opinion Apple shouldn’t be taking a monthly cut of streaming services where they’re not hosting any of the content. I didn’t sign up for Netflix because of anything Apple did and I’m currently watching it via my smart TV which is using Roku software. In the Amazon app you can purchase anything except digital media because Apple would get a cut of those transactions. For anyone who thinks Apple deserves a cut of Netflix, Amazon, Spotify etc. do you also think they deserve a cut of Uber and Lyft? I think the latter two companies are way more dependent on the App Store than Netflix is.

trashman69 said:

Honestly- Netflix has done it right - having the app built-in on most smart TV’s.

I have Roku built in to my smart tv. The only time I use my Apple TV is if I need to airplay something.

Good grief they should have done this years ago. Apple TV is way overpriced for what it’s being used for.

FAANG stocks are officially in a bear market.

Is this report talking about gross margins or profit margins? Do you have a comparison of average selling prices over time?