> Under what definition of monopoly does Apple possess one?
Market power is defined by pricing power (empirical absence of substitution effect), not share of some descriptive market (where you could always get any result you wanted just by changing the way you divide market descriptions.)
Then say market power instead of monopoly and no one will ever dispute that. Of course Apple can and does set the price of its products above their marginal cost. Doesn't have quite the ring to it as "monopoly" though.
This is such banal point to make when Apple combined with Google have Duoloply. With Apple's advantage in App store spending Apple basically dictates whatever they want to App developers. So saying that they have monopoly like powers is completely and entirely correct.
That isn’t the definition of monopoly as stated by Wikipedia[1]: “a market with the "absence of competition", creating a situation where a specific person or enterprise is the only supplier of a particular thing.” I think calling them a monopoly is a real stretch.
> Courts do not require a literal monopoly before applying rules for single firm conduct; that term is used as shorthand for a firm with significant and durable market power — that is, the long term ability to raise price or exclude competitors. That is how that term is used here: a "monopolist" is a firm with significant and durable market power. Courts look at the firm's market share, but typically do not find monopoly power if the firm (or a group of firms acting in concert) has less than 50 percent of the sales of a particular product or service within a certain geographic area. Some courts have required much higher percentages. In addition, that leading position must be sustainable over time: if competitive forces or the entry of new firms could discipline the conduct of the leading firm, courts are unlikely to find that the firm has lasting market power.
> Obtaining a monopoly by superior products, innovation, or business acumen is legal; however, the same result achieved by exclusionary or predatory acts may raise antitrust concerns.
>Courts look at the firm's market share, but typically do not find monopoly power if the firm (or a group of firms acting in concert) has less than 50 percent of the sales of a particular product or service within a certain geographic area. Some courts have required much higher percentages.
which seems to lend real credence to the argument that Apple would (most likely) not be understood as a monopoly in the courts. Sure it could happen, but lots of unlikely things can happen that still say won't happen because of how humans communicate.
> which seems to lend real credence to the argument that Apple would (most likely) not be understood as a monopoly in the courts
The issue isn't marketshare, the issue is defining the market within which marketshare is looked at. If you don't use some consistent objective defenition of market boundaries, you can pick or choose any result you want by how you describe the market applicable to any given case.
While it isn’t perfect, “the space within which consumer substitution in response to changes like pricing occurs from the given good or service” is a rough description of what market boundary determination in US antitrust/competition law aims at.
It's also, for obvious reasons, often the most contentious issue in antitrust cases, with a whole lot of market data thrown up by every interested party aimed at proving what the right market boundary is. If you just assume the boundary is some popular market description without interrogating whether consumer substitution for the given product really occurs across that whole descriptive market space (and, on the other side, only within that space), you are really just skipping over the most important question in antitrust.
If you're stretching "market power" and "consumer substitution" this far it seems like a whole lot of fashion brands would be "monopolies". Tesla. The BMW/Mercedes/Audi luxury German auto bands in the US. Google Search. Macs. Thinkpads. There are SO MANY market sub-slices where some brands have pricing power over others. Where do you draw the "how often do people have to switch" line? Some of use have switched multiple times between Android and iOS in the last decade, after all.
If there's anything that's an industry outlier, it's a FAANG, not to mention the most profitable company in the history of the world since the Dutch East India Company.
Apple has 60% of the mobile OS market share in the US, and even more when it comes to mobile app distribution. Google has 40%, both in effect are a duopoly.
I mean they are the only person who can legally provide adds and payment services on iPhones. Apple exhibits a huge amount of control over there platform in name of defending there customers but give little choice to the customer in how that's delivered
> That isn’t the definition of monopoly as stated by Wikipedia[1]: “a market with the "absence of competition",
It exactly is, if you further define “market” empirically by consumer behavior demonstrating products actually compete with each other rather than analytically based on some abstract comparison of features that make you think they should.
We have a good old fashioned concept of "relevant market".
> A relevant product market comprises all those products and/or services which are regarded as interchangeable or substitutable by the consumer by reason of the products’ characteristics, their prices and their intended use.
Are we able to substitute browser engine or app store in iOS? If not, then its app store itself can make of a single relevant market. This is so obvious to the level that even Apple knows they cannot avoid, so they're trying to make an argument that app store and browser engine are technically inseparable system service, not an interchangable product. (I strongly suspect that this is one of the reasons why we cannot get standard 4~6 weeks browser updates for Safari, decoupled from OS updates) EU doesn't seem to be very happy with that argument so they passed the Digital Market Act in response. And US is preparing a bipartisan bill similar to DMA as well.
Yeah, I know the actual process for defining market is much more complicated but this is the basic idea. Antitrust investigation is a largely economical, data driven process and you cannot simply say "Even in their best market, the U.S., iPhone holds just a smidge over 50%". I won't assert they're in a monopolistic position, but many regulators (especially in EU) believe in that.
You can buy a used game from a separate company and throw it in your nintendo no problem. You can use a different app store on Android or sideload. The Epic case was not a total loss - I do not agree personally
How many consoles will let you run games published without licensing enforced with code signing or such mechanisms? Bit harder to make an unlicensed game now than it used to be.
Profits. Apple has by far the lion share of profits and is able to leverage them to muscle into businesses. As iPhones are the premium devices one can reasonably argue Apple has a near monopoly of access to affluent eyeballs.
Apple, please listen. These platform dreams of controlling supply, demand and the underlying tech platform are dangerous. Likely to fail or if you succeed it will run anti-trust problems. But your biggest risk is distraction. The shiny new kids on block wagging the core business to the detriment of customers and shareholders.
Buying an iPhone is like buying a Costco membership. The argument is that you buy the device for the app ecosystem. If you want a different app ecosystem, you buy a different device.
I mean, that is what Apple wants to sell you, but that's really no different than Ford saying "You have to buy Ford gas and tires because this is a Ford ecosystem", in which we've told the car companies to screw right off, though this is coming back with electric vehicles in a bad way.
One of the other arguments here is that when it comes to games I can get a Nintendo, or an Xbox, or a PS5, or a PC that I can run Windows/Linux games on.
When it comes to phones we pretty much have a duopoly which means both groups can find it easy to manipulate the market to higher prices without indirect (illegal) signalling.
Luckily it looks like the EU is telling Apple to suck it and they'll have to open up app stores on their phones.
All of those gaming platforms have platform exclusives though, and pretty clearly can exert significant influence on game developers due to their ability to determine what software runs on their devices. I'm not really sure how the duopoly of smartphones is significantly different than the handful of competitors in the gaming market.
There are thousands of competitors in the gaming market.
There is also a big difference between a company saying "I am only going to make this for the Apple app store" and saying "You can only have the Apple app store".
I would only make it illegal to sign an exclusive contract. The market would handle the rest, unless the platform they targeted had unique capabilities that other platforms didn't (e.g you game will only work with on a touch screen).
Buying a Costco membership doesn't mean you can only shop at Costco though. If Wal-Mart has a better price on X or if Mom and Pop shop has item Y that Costco doesn't carry you can still buy them.
And buying an iPhone doesn't mean you can't also buy an Android phone. The analogy you're looking for is that Costco does not indiscriminately allow all sellers to sell products at a Costco warehouse.
Monopoly means lack of competition, not lack of consumer choice. High end consumers prefer Apple devices, but nothing stops them or anyone from going out to buy any Android device they want, or any PC they want.
Sure there is, Apple has done the same kind of bundling Microsoft got busted for. Switch from Safari to Firefox on your desktop and now your browser won't sync tabs to your phone unless you use the fake webkit-in-sheeps-clothing version of Firefox that Apple has mandated and maintains insane control over (no real ad blockers, only limited ones).
Microsoft never got “busted” in the US for bundling IE and absolutely nothing change. Microsoft got “busted” for forcing OEMs to pay for Windows licenses even for computers that didn’t ship with Windows.
Would you actually want a computer to ship with nothing?
Also your other talking point about no “real adblockers” is at least a year out of date. Safari has supported standard extensions for over a year not just JSON based content blocking rules.
The alternatives weren't nothing or Windows. OEMs had other options even in the 90s. Would OS\2 have done a little better in the marketplace to actually carve out a niche? Would desktop Linux be a better experience since OEMs could have had machines designed and targeted with Linux in mind back in 1997? Would BeOS still be around?
Had OEMs not be forced to pay for Windows licences for all computers shipped regardless of whether it actually included Windows or not perhaps they wouldn't have shipped Windows so damn much?
1. Microsoft was held accountable and forced to stop making OEMs pay Windows licenses for computers that didn’t ship with Windows.
As an aside, there is no “Windows tax”. OEMs make more than enough by bundling third party crapware it more than pays for Windows. But third party OSs - especially Linux was never going to be big on the desktop without third party commercial support. The only Unix[1] operating system that has ever gained any traction on the desktop is MacOS and Apple makes sure they bend over backwards to keep Microsoft and Adobe happy.
I sold IBM Aptivas briefly in the 90s that came with OS/2 at Radio Shack. They were not going to overtake the world.
2. As far as “bundling” in 2022, would you suggest any platform come without a browser? Macs, Windows, ChromeOS computers, iOS and Android all come with browsers. What would the consumer experience be like if all platforms just came with an empty desktop and they had to download everything?
Maybe Linux would have gained more traction if OEMs were shipping it? But instead they had to pay for a Windows license anyways so may as well ship that...
And had it shipped on OEM machines that might have attracted more third party devs too. And they could have sold crapware if they wanted as well. It's impossible to say for certain that MS's policies had no impact on the desktop computer space.
As for 2, well that depends how hard is it to get a browser? Can I just open a store or repo and grab one or do I have to sneakernet it on there? I don't think it has to be a bad experience to have a barebones system if done right.
Since the 90s, platforms really didn’t have a chance that didn’t run Microsoft Office and Adobe. Remember that MS was on stage with Apple when the first Mac was introduced.
Vertical market apps are going to target the computer with the largest market share. You’re going to be hard pressed to tell your local dentist office they need to run Linux to run the equivalent of their VB based software.
Most people already complain when their first launch experience requires them to update their OS - mostly consoles. I can’t imagine telling my mom, to download a browser, email client, dialer, messaging app, calendar, contacts software, notes app, etc.
Dollar share of a market is 9ne measure of market share that can be used; and a large enough market can be split into segments when applying monopoly tests.
And I’m sure you have case law that the high priced lawyers couldn’t find that would have convinced the judge in the Epic trial that Apple was a monopoly?
Well, I would assume whatever it was, a bunch of high priced lawyers would have a better strategy and didn’t miss a line of argument that was found by a random person on HN.
Holding a monopoly and engaging in anti-competitive behavior are entirely different.
The app store being closed and not allowing 3rd party stores would be considered anti-competitive. They have a 100% monopoly on the ios application market.
I don't think they're doing much anti-competitive in the phone hardware space though.
