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US Top Court Leans Toward Allowing Apple App Store Antitrust Suit (reuters.com)
U.S. Supreme Court justices on Monday appeared open to letting a lawsuit proceed against Apple that accused it of breaking federal antitrust laws by monopolizing the market for iPhone software applications and causing consumers to overpay. From a report: The nine justices heard an hour of arguments in an appeal by the Cupertino, California-based technology company of a lower court's decision to revive the proposed class-action lawsuit filed in federal court in California in 2011 by a group of iPhone users seeking monetary damages. The lawsuit said Apple violated federal antitrust laws by requiring apps to be sold through the company's App Store and then taking a 30 percent commission from the purchases. The case may hinge on how the justices will apply one of its past decisions to the claims against Apple. That 1977 ruling limited damages for anti-competitive conduct to those directly overcharged rather than indirect victims who paid an overcharge passed on by others.
The lawsuit said Apple violated federal antitrust laws by requiring apps to be sold through the company's App Store and then taking a 30 percent commission from the purchases.
I don't get how this is a monopoly without contorting the definition of the word into something utterly useless. If it was such a terrible deal for software vendors then why do they persist in using Apple's platform? There are alternatives which are actually considerably more popular by unit volume and more open to third parties. I don't see the public interest here.
And if the argument is that Apple is taking too big a cut then the argument is de-facto that the government should engage in price fixing which is almost always a terrible idea. What is the "right" amount? 5%? 20%? 50%? For any number greater than zero they are asking the government to determine a market price and the government is terrible at doing that especially when there is no compelling public interest in doing so.
That being the " Service " department at your local car dealership.
If I'm not mistaken, the courts basically told dealerships to f*** right off when they demanded folks bring their cars into a " certified $brand_name dealer " or use only " certified $brand_name parts " for all service and warranty related issues lest you void your warranty. All at a considerable markup on parts of course. . . . . .
I would suspect the end ruling on this will flow along similar lines.
"This is legal because they are not a monopoly."
Likewise, Apple is not a monopoly either, with 43.5% of US smartphone owners running some form of iOS.
a) Monopoly does not require a sole vendor; you can have monopoly power and abuse it without being the only game in town. (See Microsoft's antitrust suit) 43% is huge; especially when the other smartphone OS is basically controlled by another single vendor. So we have a duopoly at best.
b) No one said they have have monopoly on smartphones. They have a monopoly on iphone apps.
Monopolies aren't inherently illegal. But they are subject to review and regulation in the public interest. In a case like this one element that strengthens the case against apple is that the consumer is tied to apple with an expensive phone. For a consumer to change what apps they buy they have to abandon a *separate* expensive product in the phone itself.
If I get pissed at chevron, i can just start buying gas somewhere else. I don't have to get a whole different car. I can get replacement parts from 3rd parties, I can get service from 3rd parties, i can install a stereo made by a 3rd party. etc etc. I can exercise my freedom to buy goods and services from whoever i want, without having to get a new car first.
Likewise, if get pissed at google play, i can get apps somewhere else. And in fact I do generally get my android apps from f-droid, and most of my games are from the humblebundle store for android. If I get pissed at steam there are some games i won't be able to buy, but there are plenty of other stores willing to provide me with PC software. I don't have to buy a new computer.
See the difference?
Now you can argue (rightfully) that consumers (should) know the deal with apple going in so caveat emptor; and that's a fair argument. But that doesn't automatically make it legal beyond reproach; the court should hear it.
You can also argue (rightfully) that its similar too or even exactly the same thing console makers do; and that's a good argument too. I do think there is a qualitative difference between a toy and an almost essential tool though; such that consumers don't necessarily need the same protection from Nintendo with respect to the availability of DS software as they do for their smartphones. Again that's a determination for the court.
Personally, I think Apple's store monopoly should be broken for the good of the market as a whole. There is a LOT of stuff that should be available that isn't or that is more of pain than it should be because of Apple's store monopoly. It's *the* primary reason I don't use an Apple phone myself.
antitrust laws exist to prevent the monopoly abuses of the past, but they affect companies regardless of whether the company is a monopoly
Right. Let's go straight to the source. The Sherman defines "every person who shall monopolize, or attempt to monopolize, or combine or conspire with any other person or persons, to monopolize any part of the trade or commerce among the several States, or with foreign nations" as a criminal needing punishment. In fact, that's almost the entire thing. Very short, very broad. (Of course it's backed up by a huge body of case law.)
Nothing about monopolies there, it's about monopolists and what they do or attempt to do. The usual mob of deniers ought to keep that in mind, instead of wanking on about what is and is not a monopoly.
When all you have is a hammer, every problem starts to look like a thumb.