Apple App Store Court Case, Monopolistic??

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tdgeek

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#243100 26-Nov-2018 18:53

I cant see how

On Monday, the United States Supreme Court will hear arguments as part of an antitrust lawsuit against Apple over its App Store and app commission policies. As reported by Reuters, the issue stems from Apple’s 30 percent cut of App Store sales. Apple has previously asked the US Supreme Court to throw out this antitrust lawsuit.

Apple argues that it is only acting as an agent for developers who sell to consumers via the App Store, not a distributor.

https://9to5mac.com/2018/11/25/apple-antitrust-supreme-court/?pushup=1

Its a business, everyone gets their cut, IMHO

Apple is appealing a lower-court decision and claims that its practices are not monopolistic.

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#2134864 26-Nov-2018 19:19

I'm not a lawyer, but "if you want to buy apps for your phone, you must buy from us" sounds monopolistic to me.

rugrat

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#2134911 26-Nov-2018 21:44

30% seems a high charge to me.

I had to go outside the Apple Eco System to buy YouTube Red. Every attempt I made to buy off web page on Apple product would take me to the rip off Applic Store. It was $3 a month more expensive through Apple.

After I got You Tube Red going through a PC, the login worked fine on Apple Products.

Last I looked Spotify doesn't even give a Apple Store option, it's through Web Page only.

Is it a monopoly though when they can just give a web link to pay, and then you use login details on Apples devices, completely cutting Apple out of the loop with the money.

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#2134913 26-Nov-2018 21:46

Behodar:

I'm not a lawyer, but "if you want to buy apps for your phone, you must buy from us" sounds monopolistic to me.

The concept of a "monopoly" in competition/antitrust law doesn't mean what your average person thinks it means.

tdgeek

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#2134970 27-Nov-2018 06:50

Behodar:

I'm not a lawyer, but "if you want to buy apps for your phone, you must buy from us" sounds monopolistic to me.

Its a feature. The upside is one store, fully vetted apps, consistency, security. You can buy apps elsewhere, Android apps, Windows apps, apps are not a monopoly, just change the device. Always a choice

Senecio

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#2135010 27-Nov-2018 08:44

rugrat:

30% seems a high charge to me.

I had to go outside the Apple Eco System to buy YouTube Red. Every attempt I made to buy off web page on Apple product would take me to the rip off Applic Store. It was $3 a month more expensive through Apple.

After I got You Tube Red going through a PC, the login worked fine on Apple Products.

Last I looked Spotify doesn't even give a Apple Store option, it's through Web Page only.

Is it a monopoly though when they can just give a web link to pay, and then you use login details on Apples devices, completely cutting Apple out of the loop with the money.

I don't think the likes of Spotify Premium, Youtube Red/Premium etc... are the focus. In these cases the App is free to download and is just a carrier for the product (the media). The media can be subscribed to through the App store or alternatively direct with the provider through their website. The issue is when the App is the sole product and can only be bought through the App store. It's a dying segment I know with more and more App developers favouring a different revenue model (free to download App with in-App purchases). Although the In-App purchases would still incur the Apple cut of the proceeds.

SpartanVXL

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#2135024 27-Nov-2018 09:07

This makes no sense. Apple has a monopoly on a software distribution feature on a device range they solely own? Of course they can do whatever they want. It's like asking if Microsoft or Sony has a monopoly on their Xbox or PSN stores for games that are available on Xbox or Playstation. Of course they do? They also get a 30% or more cut from the game publishers.

antoniosk

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#2135025 27-Nov-2018 09:13

Some of the salient points (summarised from a CNBC article here

"A nearly decade-long battle over Apple's App Store is set to finally be argued before the justices of the U.S. Supreme Court on Monday, setting up a high-stakes showdown over whether the company can be forced to pay damages to iPhone owners who say the App Store is an unlawful monopoly.

The iPhone owners who brought the suit allege that Apple's 30 percent commission on app sales amounts to price gouging passed on to consumers. iPhone owners can only buy apps through the App Store, unless they bypass Apple's rules by "jailbreaking" their phone, which modifies the iPhone's software so users can download apps outside the App Store. Jailbreaking an iPhone voids its warranty.

The case does not address the underlying monopoly issue, but instead will determine whether the iPhone users can bring the charge at all. Apple has argued that only app developers could bring such a suit.

The precedent the court is revisiting was set in Illinois Brick Co. v. Illinois, a 1977 dispute in which the court ruled in favor of concrete brick manufacturers. The state of Illinois sued the brickmakers for allegedly inflating their prices, causing an increase in the the cost of public building projects.

The court ruled that even though the increased brick costs might hurt Illinois indirectly, only the contractors who actually bought the bricks had standing to sue. That established the so-called "Illinois brick doctrine," which says that only the direct purchaser of a good can collect damages from a monopoly holder."

So the technical point is that Apple doesn't set the prices, the developer does. Apple's fees are covering the cost of running the app store, providing a market etc, so the point is only the developers can lodge a complaint, not the end consumer.

Boring I know, but the distinction matters a little. The consumer point is that customers have no choice and must purchase via the app store, meaning the apps are not available via any other means, and that's something that will be considered after the case above has decided. Whether that point survives the Spotify model - Spotify is free, you sign up on the website which bypasses the app store, which is mildly inconvenient but hardly a significant barrier to entry - is a question to be answered in the next decade.

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gehenna

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#2135026 27-Nov-2018 09:14

I'm more concerned with the Shelocked apps that end up as part of iOS, than having a single App Store for distribution.

wellygary

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#2135031 27-Nov-2018 09:19

rugrat:

30% seems a high charge to me.

Tell that to Uber eats... 20-30% appears to be the standard for being a middleman these days....

tdgeek

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#2135064 27-Nov-2018 09:24

rugrat:

30% seems a high charge to me.

Compared to many things in life, and also PC software, apps are so cheap. 30% may seem large but its not, many items have large margins for various reasons. Apps are often dirt cheap so the 30% is pretty minimal, dollar wise

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#2135067 27-Nov-2018 09:28

30% doesn't seem like a steep fee to have instant access to the massive market that comes with iOS devices. What's less transparent to me is how apps get surfaced in the App Store main page for the Editor Picks and sections like that. Are they paid ads do you think?

Apple also has infrastructure fees to distribute the apps. At some point they would have recouped enough of that to keep them in profit going forward though.

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#2135074 27-Nov-2018 09:37

gehenna:

30% doesn't seem like a steep fee to have instant access to the massive market that comes with iOS devices. What's less transparent to me is how apps get surfaced in the App Store main page for the Editor Picks and sections like that. Are they paid ads do you think?

But if other online marketplace charged a 30% fee - I'm thinking of Trade Me, for example - would that be considered steep? I think it would.

tdgeek

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#2135079 27-Nov-2018 09:46

Hammerer:

gehenna:

30% doesn't seem like a steep fee to have instant access to the massive market that comes with iOS devices. What's less transparent to me is how apps get surfaced in the App Store main page for the Editor Picks and sections like that. Are they paid ads do you think?

But if other online marketplace charged a 30% fee - I'm thinking of Trade Me, for example - would that be considered steep? I think it would.

Stuff on Trademe can be worth anywhere from 50c to $5000+. Apps are generally under $5, under $10. 30% on $5 is cheaper than 5% on $100

SpartanVXL

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#2135085 27-Nov-2018 09:52

Hammerer:
gehenna:

30% doesn't seem like a steep fee to have instant access to the massive market that comes with iOS devices. What's less transparent to me is how apps get surfaced in the App Store main page for the Editor Picks and sections like that. Are they paid ads do you think?

But if other online marketplace charged a 30% fee - I'm thinking of Trade Me, for example - would that be considered steep? I think it would.

The end consumer doesn't see it. The final price is whats listed on the sticker. Same with Steam, Xbox, PSN all these stores get a 30% cut from sales, but the consumer doesn't see any extra cost because the publisher (usually) eats the costs.

What the people who started this are going on about is that iOS vs android, an app listed on both would be more expensive on iOS. Apple is saying that its not their problem (and it isn't), go talk to the app publisher because they are the ones setting the prices.

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#2135169 27-Nov-2018 11:55

ANALOGY

Apple built and owns the mall (App Store) and then rents out space to retailers (App developers) who then sell to customers their products (Apps). As an added bonus to the customer Apple guarantees the safety & security of the retailers product.

Whilst the difficult we can do immediately, the impossible takes a bit longer. However, miracles you will have to wait for.

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