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U.S. Supreme Court to hear Apple App Store antitrust dispute

178 points by danbtl 8y ago

cabaalis 8y ago
> Developers “cannot risk the possibility of Apple removing them from the App Store if they bring suit,” the American Antitrust Institute advocacy group said in a brief. To my untrained IANAL eyes, this seems to be the meat of the argument. Apple is trying to say they are just an agent facilitating a sale, all the while jingling the kingdom keys in their back pocket by controlling who gets to sell. They are seeking to chill consumers and developers alike.
- mitchty 8y ago
  I think this is their argument ultimately: Apple has seized upon a 1977 Supreme Court ruling that limited damages for anti-competitive conduct to those directly overcharged instead of indirect victims who paid an overcharge passed on by others. Part of the concern, the court said in that case, was to free judges from having to make complex calculations of damages. I'm no lawyer either but that seems to generally be true of this case in that users shouldn't be the ones bringing cases but developers could by my read. But whatever we'll see what the court decides.
  - rickycook 8y ago
    mentioned and expanded on in a parent comment, but the important part of the article related to that is right at the bottom: “The San Francisco-based 9th U.S. Circuit Court of Appeals last year revived the lawsuit, deciding that Apple was a distributor that sold iPhone apps directly to consumers.” the question is whether apple sells the apps, or the developer sells the apps.
    - mitchty 8y ago
      Right but that seems to be the ultimate thing at question here not? Whether the ninth circuit's decision is correct. I'll have to wait for this week in law to cover the case from a legal perspective, they're lawyers so they tend to have a more lawyery view of things and bring on experts in the field. There tends to be more nuance than most engineers tend to bring in "apple charging 30% is immoral" arguments.
- rkagerer 8y ago
  "Apple said it is acting only as the agent for app developers who sell the apps to consumers through the App Store." Sure, an agent who just so happens to control the platform, the API's and building blocks, all the rules, the horizontal, the vertical, and unilaterally decides which apps are allowed to exist. But, "we're just an agent". I'm not familiar enough with the case to form an opinion on the whole thing, but I do hope the court sees through that particular sham of an argument.
  - rickycook 8y ago
    i wouldn’t pin that all on anti competitive behaviour though... the end to end control of the platform is kind of Apples MO, and is a fairly distinguishing feature between the Android ecosystem and the Apple ecosystem. it’d be nice to have another distribution option, but not at the expense of a simple UX, security, or any other very valid reason to only allow a tightly controlled experience
    - lwansbrough 8y ago
      Oh okay, so as long as it's their MO to have a monopoly then it's fine. I'm sure plenty of iPhone users, for example, would like to have a PornHub app on their iPhone, but that's currently impossible because of Apple's guidelines. You could build a very high quality app and be denied for a reason strictly outside of the "UX, security 'or any other very valid reason'" that Apple arbitrarily decides.
      - scarface74 8y ago
        And what would this pornhub app do that you couldn’t do from the website? Should Nintendo also be forced to sell a PornHub game?
        AnthonyMouse 8y ago
        > And what would this pornhub app do that you couldn’t do from the website? Store files for offline use or untracked use, have better privacy because user settings can be stored locally rather than on the server, provide source code that can be audited rather than relying on javascript that can change at any time, etc. In general, anything an app can do that a website can't -- otherwise why do native apps even exist? > Should Nintendo also be forced to sell a PornHub game? They shouldn't be allowed to prevent someone else from distributing one.
- ethbro 8y ago
  (Not a lawyer, so no idea if this is still controlling case law) The full reasoning chain seems to be that Hanover Shoe v United Shoe Machinery Corp (1968), in which the issue was USMC's leasing but refusal to sell machinery on which they had a monopoly, decided that being able to "pass along costs" was not a valid defense by a monopoly when sued by its direct customers. Consequently, in Illinois Brick v Illinois (1977) the court decided that if a monopoly cannot use "they can pass along costs" as a defense from damages, then it follows that indirect purchasers (ie customers of customers) cannot use same offensively to sue a monopoly. The intent is to prevent the complexity of calculating damages-once-removed, and putting the onus on the (simpler) damage calculation between direct monopoly and immediate customer. If the Court upholds the prior decision, the plaintiffs will be denied standing. In that case, the appropriate legal challenge would either be an app seller suing Apple, or a customer suing an app seller (who could likely sue Apple in response). If this is still case law, the only way I see this going another way is if the Court sees Apple's flat-30% as fundamentally different (and simpler) than the previously considered costs. [1] Hanover Shoe, Inc. v. United Shoe Machinery Corp., 392 U.S. 481 (1968) https://supreme.justia.com/cases/federal/us/392/481/ https://supreme.justia.com/cases/federal/us/392/481/ [2] Illinois Brick Co. v. Illinois, 431 U.S. 720 (1977) https://supreme.justia.com/cases/federal/us/431/720/ https://supreme.justia.com/cases/federal/us/431/720/
  - rickycook 8y ago
    the important part against that line of reasoning though is at the very bottom of the article: “The San Francisco-based 9th U.S. Circuit Court of Appeals last year revived the lawsuit, deciding that Apple was a distributor that sold iPhone apps directly to consumers.” if they decide that apple sells apps directly (after all, you go through apples distribution, payment, and “editorial” channels and have only a tenuous link to the developer i question) rather than the developers selling apps, then that could be an issue for them
    - caf 8y ago
      Right, this is distinct from the shoe case because here Apple has a direct relationship with the customer in a way that USMC didn't with the purchasers of shoes.
aftbit 8y ago
I don't understand why Apple isn't getting slapped for only allowing Safari-based browsers in the App Store. I don't understand anti-trust laws that well, but didn't Microsoft settle out of a very similar case related to bundling Media Player and IE with Windows?
- rootusrootus 8y ago
  I expect the substantial difference is that Microsoft's share of the PC market was far closer to a monopoly than Apple's share of the smartphone market is now (about 40% in the U.S.)
  - EGreg 8y ago
    I never understood why 40% is too little to be considered free and clear from monopoly laws. Why not have a smooth gradient
    - rootusrootus 8y ago
      I can't imagine how you would implement such a scheme. For example, forcing Apple to allow non-Safari browsers in the app store is a binary choice, not something you can implement on a gradient. On top of that, market share tends to move around, sometimes a lot, so you would be changing the rules of the game constantly. 40% definitely is low enough to escape scrutiny as a monopoly, in any case. More than half of everyone who buys a smartphone chooses something non-Apple.
      - EGreg 8y ago
        So if every top vendor did that, you'd have something like a cartel, except it wouldn't just be high prices, it would be "once you're in our ecosystem, no more interchangeable parts for you, we own the whole stack". It's a bit like feudalism!
- meepmorp 8y ago
  Microsoft had a monopoly on the desktop OS market, and so pushing IE was anti-competitive. Apple isn’t anywhere near having a monopoly in phones, in the US or anywhere else. It’s not just the behavior that’s against the law, it’s the behavior plus the market position.
tptacek 8y ago
Isn't the premise of this case, that Apple's "monopoly" on the app store and 30% toll on developers is effectively jacking up app prices for consumers, pretty hard to support with evidence? My impression is that the modern app store coincides with (if it didn't actually cause, which is possible as well) an industry-historic decline in software prices for consumers. Things we pay $0.99 today for used to cost $50.
- kodablah 8y ago
  The rising tide lifts all technological boats, so it makes little since to compare today with historical water levels. Things can be overall cheaper compared to the past, but still anti-competitively hamstrung. If you can compare to costs of things in the past, you probably won't find any technology more expensive.
  - tptacek 8y ago
    That's a colorable argument on a message board, but in court, if intervention is to be premised on harm to consumers through overcharging, Apple's opponents will need to present empirical evidence, not counterfactuals. Be that as it may: all the evidence available to me suggests that mobile app stores have drastically reduced the cost of retail software to consumers. If anything, what I've seen is the opposite concern, which is that app stores make prices too favorable for consumers, at an untenable cost to the developers.
- brennankreiman 8y ago
  $0.99 or free with all the important features a $19.99 in app purchase each.
  - olliej 8y ago
    The is a consumer choice - look at literally every new product announcement that comes with a >4.99 price tag. Basically you get people saying it’s unreasonable because making a copy of an app costs nothing. Because heaven forbid they give any value to the time required to design and create a piece of software. It’s often followed up by claims that they could do it thenselves for much less in much less time, ignoring the realization that that is only possible because the original developer has done all the hard engineering and design work, and worked out how to make things fun, etc. (my most obvious memory of this was when Threes came out and it was instantly cloned by people who had full access to the game design)
BurritoAlPastor 8y ago
Here’s what I don’t get: in what sense is this a monopoly? Consumers have knowledge that the App Store is the only game in town on an iPhone, and they have the option to buy a different phone if they don’t want to use the App Store. That’s like saying that the manufacturer of my vacuum has a monopoly on vacuum bags.
- dmead 8y ago
  but don't they? i think a more apt analogy would be your trash can manufacturer having a monopoly on trash bags. You shouldn't really expect that to be the case at all.
  - BurritoAlPastor 8y ago
    Why is that more apt? Why shouldn’t I expect it? Apple didn’t even invent the walled-garden digital software store; Microsoft was using it on the X-Box in 2005. If you go back to before digital distribution, Sony and Nintendo had total authority over third-party software releases for their platforms since the 90s and 80s respectively. I understand the free-software arguments for why I should be able to run arbitrary code on any computer I own. What I don’t get is the monopoly argument.
    - dirkgently 8y ago
      > Why shouldn’t I expect it? Why should I, as a consumer? I don't understand this argument from Apple apologists. > Apple didn’t even invent the walled-garden digital software store; Microsoft was using it on the X-Box in 2005. So if it wasn't called out then, it should never be called out ever?
      - BurritoAlPastor 8y ago
        “Called out”? Sure. It was called out when Microsoft rolled it out and it’s been called out persistently for ten years, to the point that I’m used to being called an “apologist”. But public criticism is orders of magnitude different from a legal injunction. I simply don’t see how the definitions and aims of a theory of monopoly can be usefully applied to this case.
friendstock 8y ago
30% is a lot to take away from the developers. It's good to have some pressure on Apple to lower their percentage.
- HatchedLake721 8y ago
  Yeah? Have you ever tried pushing your software during Windows Mobile era?
  - dchest 8y ago
    If you didn't use third-party sellers, you could have published your software on your website and accepted payments via any of the "software registration" services or even PayPal. 5-15%.
  - Apocryphon 8y ago
    And 30% was a rate that was concocted during that same era, or shortly after. Why should it still hold true now, when Apple's revenue is far greater?
blfr 8y ago
Not being American, this is the one thing I wish Trump/GOP/conservatives did in the US: bust the tech trusts. They're taking the courts, they can surely find state or federal attorneys to bring the cases, and the executive would provide them with cover and enforcement. I'm surprised they haven't done it already. It would make sense for purely partisan reasons because tech companies are very liberal and extremely hostile to Trump's administration. But they could even reach across the aisle with megacorps like Amazon pretty clearly abusing their lower level employees which has been a cause on the left for decades.
- anime_forever 8y ago
  You're being downvoted but I agree with you even if it's slightly hypocritical coming from the Trump administration
  - blfr 8y ago
    It wouldn't be hypocritical for Trump since IIRC he bashed Amazon during the campaign. Probably a little more difficult for the Chamber of Commerce republicans.
    - zachwood 8y ago
      He bashes Amazon because Bezos owns a newspaper he doesn't like.
      - blfr 8y ago
        Perhaps it's a proxy attack but he criticized Amazon's tax practices for putting smaller shops out of business and the supposed preferential treatment by the USPS. Anyway, my point was that it doesn't matter. His administration could do good here for purely partisan reasons.
        dwaite 8y ago
        The USPS allegation was 100% untrue as reported by the postmaster general (who you think would be someone Trump would have consulted). The tax stuff is really none of his damn business (because it is really a state tax code issue at this point, not a federal issue) If Trump does anything to attack Apple, it will be because he things doing so will benefit the US economy (likely because someone else told him it would). Things like convincing Apple to make certain parts in the US, even if doing so would increase prices in the US (and dramatically do so elsewhere in the world).
lbacaj 8y ago
Unfortunately for Apple, I do think the App Store being an exclusive and default way to purchase and load apps on iOS is in fact causing prices of Apps, in many cases, to be higher than they should be. The perfect example of this is the subscription services, right now you can get a cheaper subscription to a service such as Spotify if you buy it off the App Store. That is a prime example of how much the 30% payment to Apple is hurting developers and ultimately consumers... Apple is so upset about this they won’t let developers like Spotify link to buying the subscription on their own website anywhere on the app that is sold through their App Store, if that’s not Monopoly abuse I don’t know what is. As much as I love Apples products I do feel that they have gotten away with a lot here, especially since there is zero other ways to load apps into iOS devices, in the very least consumers are paying 30% more for apps if there was a competing App Store on iOS that charged less to load apps. Edit: whether the Supreme Court will see it this way or not is a whole other issue.
- threeseed 8y ago
  Apple provides a service for that 30% though. They handle the payment processing, they build, moderate and curate the App Store apps and they provide a lucrative channel to market for app developers. So allowing Spotify et al to get all the benefits of the channel without paying for it is actually unfair to Apple.
  - dd36 8y ago
    So charge the developers for that underwriting service.
  - lighthazard 8y ago
    This was true a few years ago but in 2018, it's not a curated place to get software. It's the only marketplace to get software for your device. 30% is disproportionate to what's being offered today.
  - samat 8y ago
    This argument will easily hold if there were any way to have a competing store on iOS devices. Apple banning any competition in that field makes ‘buy they provide value for the money’ look like forcing consumers hand. Not sure if I want to have a second AppStore (APNS, etc, etc.)
sjg007 8y ago
I guess the issue is that side loading apps or an alternative App Store is not supported. That and disallowing purchases or rentals on amazon video or kindle apps for iOS.
rixrax 8y ago
Answer is not to give choice in where to download apps. If you don't like Apple app store, then maybe switch to Android or BlackBerry. Or something else. I like being able to go to just one store and get my Apps there. Imagine the horror of having to get the apps from AT&T or Vz store for iPhone, or having to choose if I need to get an app from official store or from another one run by some east European dude from his basement. I love that apple curates the apps and at least tries to get rid of worst offenders whether it's privacy violations or outright malware.
- 43920 8y ago
  If you think the services the Apple app store provides are worth the price increase, then you as an individual consumer could choose to buy apps just from that store. Or you could buy an app directly from the developer, whom you presumably trust (and even if you don't, the app is sandboxed, so the chances of something bad happening are pretty low). Or you could buy the app from an alternative store that's more trustworthy than just "some east European dude from his basement", which would someone would almost certainly create if they had the option to. Plus, Apple isn't just getting rid of the "worst offenders", it's also banning apps with content it dislikes, or that hurt its business model: https://bgr.com/2018/05/25/steam-link-for-iphone-download-ios/ https://bgr.com/2018/05/25/steam-link-for-iphone-download-io... https://bits.blogs.nytimes.com/2012/08/30/apple-rejects-app-tracking-drone-strikes/ https://bits.blogs.nytimes.com/2012/08/30/apple-rejects-app-...
- dingaling 8y ago
  And yet if an ISP blocked Netflix and made you buy from ISPFlix there'd be wailing and rending of garments. I mean, you could just change ISP to ISP2 if you didn't like it.
  - danaris 8y ago
    It's easier to change from iOS to Android than it is to change ISPs in huge portions of the US. At least changing from iOS to Android (or vice versa) doesn't require you to buy a new house and move—probably move far enough that you need to find a new job, too.
zaidf 8y ago
I have recently found myself reconsidering my views on Tim Cook. He has generally positioned himself as the voice of reason, especially on matters of privacy. He’s gone as far as attack companies like Google and Facebook. And yet, all of this masks a simple truth abt Apple: any extra privacy or consumer protection comes at a very hefty cost, making most of its products unaffordable for most of the world. In contrast, Google’s Android is affordable for many large markets Apple doesn’t find worthy of competing in.
- nradov 8y ago
  In principle there's nothing stopping Android device manufacturers from respecting privacy by using AOSP without Google services. However in practice such devices have either been market failures, or are even worse from a privacy standpoint (i.e. infested with Chinese government spyware).
  - samat 8y ago
    Until very lately there were secrect mandatory agreements with google which made device manufacturers unable to sell devices with and without googles software at the same time. You had to choose one.
kitsunesoba 8y ago
Perhaps it’s an unpopular opinion, but I’m hopeful that this doesn’t go anywhere for the simple fact that I don’t want to have to keep 5 different app stores installed to have access to everything. It would be cool to have an iOS equivalent of F-Droid, but I’d rather that not come at the cost of scattering commercial iOS apps across stores. I’m not keen on the idea of non-WebKit web engines on iOS either because it will inevitably enable a huge contingent of lazy web developers to just display a “screw you and your device’s battery, go download Chrome” message rather than bother with crafting their sites and web apps in a web engine agnostic way. It’ll be just like when IE was the dominant browser, except this time around the dominant engine is favored by web devs and will continue to be thanks to Google’s web-centrism.
- vedantroy 8y ago
  I think its good to force Apple to allow non-WebKit web engines on iOS. Right now Apple can forcefully cripple technologies like progressive web apps by not supporting the latest web technologies. This allows Apple to force companies to develop native applications. Similarly, Apple has been slacking off on improving Webkit and making it as good as V8. By getting rid of Apple's monopoly on web engines, developers will be able to push websites to new levels that are currently hard to attain.
  - koolba 8y ago
    I’d be more than happy for a WebKit browser with a fully customizable noscript and cookie policy.
  - throwaway34241 8y ago
    As long as Safari remains the default or very popular, sites will probably have to support it anyway regardless of if other browser engines are available. There's also some conflict of interest if say Chrome were to come to be the dominant browser on iOS since they also control Android. Would battery life, performance etc be prioritized as highly on iOS as their own platform? I think it would be nice to be able to load apps from outside the app store especially on devices like the iPad Pro, but I think that's a separate issue from web standards. I think the only practical way to advance web standards is for the major browser vendors to agree and implement them, even if that sometimes takes a while.
askaboutit 8y ago
Apples total lack of PWA support is a real pain. Making a mobile app is 10x the investment of a PWA and most ‘apps’ would be better off as a website. This issue is annoying me more and more lately as Apple simply wants to hold back so many things. All so they can take 30%.
scarface74 8y ago
So if Apple loses what does that mean for the stores for the PlayStation, XBox, and Nintendo.....
- ajross 8y ago
  Presumably they'd be open to the same kind of suit, which IMHO is appropriate. The issue at hand here is standing: do consumers have the right to sue for antitrust violations or is that limted to the app/game vendors who paid the markup most directly? The supreme court isn't going to decide on the merits of the specific case (because the original case in district court was thrown out due to standing -- this is the appeal of that decision) or whether or not Apple's 30% cut is appropriate.
- sdinsn 8y ago
  I don't think that's a fair comparison, since I can buy hard copy games from a variety of stores in addition to buying digital games. I can't buy hard copy iPhone apps.
  - scarface74 8y ago
    Yes you can but hard copy games, but guess what? Those games still have to be approved by the console maker and won’t run unless they have a digital signature from the console manufacturer. It’s been that way since the 80s.
    - sdinsn 8y ago
      I've developed homebrew games on multiple platforms. I know that NES, GBA, PSP, and DS have little to no restrictions. The Wii has a few restrictions, but not many.
      - scarface74 8y ago
        So exactly how did you get those games on actual hardware or did you run them on an emulator? You definitely didn’t get games distributed on unmodifurd PlayStations, Nintendos, or XBoxes. Nintendo has had a lockout system since the SNES days. https://en.wikipedia.org/wiki/Atari_Games_Corp._v._Nintendo_of_America_Inc https://en.wikipedia.org/wiki/Atari_Games_Corp._v._Nintendo_....
bubblethink 8y ago
I feel that all these measures are stop gaps at best. The fundamental thing you want is for customers to install whatever software they want on the hardware they buy. For mass market devices, it really ought to be a law that requires the manufacturer to allow consumers to do whatever they want. The manufacturer doesn't need to support these modes, and that's fine. Once you have that, the rest falls into place. This was the idea behind GPLv3 and anti-tivoization, but it never caught any traction for anything that matters.
amoitnga 8y ago
In today's world successful business often requires online presence online presence requires app to have an app my business "has to be approved by Apple" That's a freaking monopoly.
- eridius 8y ago
  Why does an online presence require an app? Most "online presences" still don't have them and do just fine.
  - amoitnga 8y ago
    it is sort of "expected". People want a native experience. To me, the entire concept seems wrong. It's like having to submit your website to chrome, and safari, and mozila, and be approved by them, for them to display your site... Don't you think it's wrong? Who are they to decide what I can or can not install on my device?
tokyodude 8y ago
IIUC if Apple loses then there may finally be better way to get GPLed software on iOS/tvOS. I currently run Kodi on my Apple TV but I had to compile and sign it myself because they can't put it on the Apple store without an alternate license AFAICT. Unfortunately while I personally think Apple should allow other app stores I don't think this particular suit will succeed. https://www.theverge.com/2018/6/20/17479480/supreme-court-apple-vs-pepper-antitrust-lawsuit-standing-explainer https://www.theverge.com/2018/6/20/17479480/supreme-court-ap...
- dwaite 8y ago
  IMHO, the reason some GPLed software is not allowed on iOS/tvOS is because RMS and others don't want their GPL code on iOS/tvOS. In particular, the argument I've seen used in the past to contest GPL code in App Store apps is that Apple (as distributor) must distribute the source directly on the App Store, rather than the application or the App Store description having a link to the source via the developer's website or another third party site. This isn't something Apple really cares about - but if someone says your app has a license violation, Apple will of course push dealing with said people onto you. This has always stuck out to me as pedantic and hardly a violation of the spirit of the license. Such politics are what have and will continue to relegate the FSF to being a small social group rather than the originally intended purpose (whether you consider that a revolution, or a reversion back to software freedom)
chipotle_coyote 8y ago
Folks here on HN are (understandably) leaping on the notion that this will force Apple to allow other app stores, or sideloading, or something else that keeps the App Store from being the exclusive distributor of iOS apps. But, a few notes that are important to keep in mind: (1) Apple is the petitioner here. They're the ones asking the Supreme Court to make a ruling, specifically on whether the complainant has the legal standing to bring this case at all. (2) If Apple loses at the Supreme Court, this just gets sent back to a lower court. It's not going to force Apple to do anything at this point. (3) Most importantly, there's no guarantee that if Apple does ultimately lose that the remedy will be opening the iOS ecosystem up to other app stores. The complaint in Apple v. Pepper is literally that Apple's lock on app distribution drives up app prices. If app prices are not being driven up by that lock, the argument has a very good chance of falling apart. This is not a case about what restrictions Apple puts on the app store , about software or device freedom, and it's not even a case about whether Apple's mandatory 30% cut is "fairly priced" by whatever definition of fair you care to use -- the case as filed literally hinges on the claim that iOS app prices are artificially inflated by that cut. And I think that in a world where people have been trained to think that $4.99 is a crazy high expensive price for software, that could be a real tough case to prove.
- auslander 8y ago
  > Folks here on HN are (understandably) leaping on the notion that this will force Apple to allow other app stores I'm leaning in quite opposite way. Apple enforces security and privacy policies of its store apps, which is main reason why it is much safer to use than Android. As for app prices, Apple Store is an open competitive market, no apps are restricted to compete. I see the point being moot. Adtech industry would love to see Apple lose though, don't let them.
  - daveFNbuck 8y ago
    > no apps are restricted to compete Apps are restricted from competing on price. I can't release a 79 cent app to compete with a similar 99 cent app.
balibebas 8y ago
I'm looking forward to the day I don't have to charge a non-profit doing good in this world $99 a year just to keep their app on the app store. Apple devices should have the equivalent of F-Droid for FLOSS goodies, and that's exactly the conclusion the courts should decide on IMO. This of course will make Apple devices less secure. But then again the current state of affairs is arguably worse given the lack of competition.
sodosopa 8y ago
Seems having an open iOS AppStore is just an incentive for crap apps. Not to say iOS doesn’t have them currently, but not matching the levels of Android
sharemywin 8y ago
If Microsoft wasn't allowed to bundle a browser with the operating system, not sure an app store should be bundled either.

178 points by danbtl 8y ago

> Developers “cannot risk the possibility of Apple removing them from the App Store if they bring suit,” the American Antitrust Institute advocacy group said in a brief. To my untrained IANAL eyes, this seems to be the meat of the argument. Apple is trying to say they are just an agent facilitating a sale, all the while jingling the kingdom keys in their back pocket by controlling who gets to sell. They are seeking to chill consumers and developers alike.

mitchty 8y ago
I think this is their argument ultimately: Apple has seized upon a 1977 Supreme Court ruling that limited damages for anti-competitive conduct to those directly overcharged instead of indirect victims who paid an overcharge passed on by others. Part of the concern, the court said in that case, was to free judges from having to make complex calculations of damages. I'm no lawyer either but that seems to generally be true of this case in that users shouldn't be the ones bringing cases but developers could by my read. But whatever we'll see what the court decides.
- rickycook 8y ago
  mentioned and expanded on in a parent comment, but the important part of the article related to that is right at the bottom: “The San Francisco-based 9th U.S. Circuit Court of Appeals last year revived the lawsuit, deciding that Apple was a distributor that sold iPhone apps directly to consumers.” the question is whether apple sells the apps, or the developer sells the apps.
  - mitchty 8y ago
    Right but that seems to be the ultimate thing at question here not? Whether the ninth circuit's decision is correct. I'll have to wait for this week in law to cover the case from a legal perspective, they're lawyers so they tend to have a more lawyery view of things and bring on experts in the field. There tends to be more nuance than most engineers tend to bring in "apple charging 30% is immoral" arguments.
rkagerer 8y ago
"Apple said it is acting only as the agent for app developers who sell the apps to consumers through the App Store." Sure, an agent who just so happens to control the platform, the API's and building blocks, all the rules, the horizontal, the vertical, and unilaterally decides which apps are allowed to exist. But, "we're just an agent". I'm not familiar enough with the case to form an opinion on the whole thing, but I do hope the court sees through that particular sham of an argument.
- rickycook 8y ago
  i wouldn’t pin that all on anti competitive behaviour though... the end to end control of the platform is kind of Apples MO, and is a fairly distinguishing feature between the Android ecosystem and the Apple ecosystem. it’d be nice to have another distribution option, but not at the expense of a simple UX, security, or any other very valid reason to only allow a tightly controlled experience
  - lwansbrough 8y ago
    Oh okay, so as long as it's their MO to have a monopoly then it's fine. I'm sure plenty of iPhone users, for example, would like to have a PornHub app on their iPhone, but that's currently impossible because of Apple's guidelines. You could build a very high quality app and be denied for a reason strictly outside of the "UX, security 'or any other very valid reason'" that Apple arbitrarily decides.
    - scarface74 8y ago
      And what would this pornhub app do that you couldn’t do from the website? Should Nintendo also be forced to sell a PornHub game?
      - AnthonyMouse 8y ago
        > And what would this pornhub app do that you couldn’t do from the website? Store files for offline use or untracked use, have better privacy because user settings can be stored locally rather than on the server, provide source code that can be audited rather than relying on javascript that can change at any time, etc. In general, anything an app can do that a website can't -- otherwise why do native apps even exist? > Should Nintendo also be forced to sell a PornHub game? They shouldn't be allowed to prevent someone else from distributing one.
ethbro 8y ago
(Not a lawyer, so no idea if this is still controlling case law) The full reasoning chain seems to be that Hanover Shoe v United Shoe Machinery Corp (1968), in which the issue was USMC's leasing but refusal to sell machinery on which they had a monopoly, decided that being able to "pass along costs" was not a valid defense by a monopoly when sued by its direct customers. Consequently, in Illinois Brick v Illinois (1977) the court decided that if a monopoly cannot use "they can pass along costs" as a defense from damages, then it follows that indirect purchasers (ie customers of customers) cannot use same offensively to sue a monopoly. The intent is to prevent the complexity of calculating damages-once-removed, and putting the onus on the (simpler) damage calculation between direct monopoly and immediate customer. If the Court upholds the prior decision, the plaintiffs will be denied standing. In that case, the appropriate legal challenge would either be an app seller suing Apple, or a customer suing an app seller (who could likely sue Apple in response). If this is still case law, the only way I see this going another way is if the Court sees Apple's flat-30% as fundamentally different (and simpler) than the previously considered costs. [1] Hanover Shoe, Inc. v. United Shoe Machinery Corp., 392 U.S. 481 (1968) https://supreme.justia.com/cases/federal/us/392/481/ https://supreme.justia.com/cases/federal/us/392/481/ [2] Illinois Brick Co. v. Illinois, 431 U.S. 720 (1977) https://supreme.justia.com/cases/federal/us/431/720/ https://supreme.justia.com/cases/federal/us/431/720/
- rickycook 8y ago
  the important part against that line of reasoning though is at the very bottom of the article: “The San Francisco-based 9th U.S. Circuit Court of Appeals last year revived the lawsuit, deciding that Apple was a distributor that sold iPhone apps directly to consumers.” if they decide that apple sells apps directly (after all, you go through apples distribution, payment, and “editorial” channels and have only a tenuous link to the developer i question) rather than the developers selling apps, then that could be an issue for them
  - caf 8y ago
    Right, this is distinct from the shoe case because here Apple has a direct relationship with the customer in a way that USMC didn't with the purchasers of shoes.

aftbit 8y ago

I don't understand why Apple isn't getting slapped for only allowing Safari-based browsers in the App Store. I don't understand anti-trust laws that well, but didn't Microsoft settle out of a very similar case related to bundling Media Player and IE with Windows?

rootusrootus 8y ago
I expect the substantial difference is that Microsoft's share of the PC market was far closer to a monopoly than Apple's share of the smartphone market is now (about 40% in the U.S.)
- EGreg 8y ago
  I never understood why 40% is too little to be considered free and clear from monopoly laws. Why not have a smooth gradient
  - rootusrootus 8y ago
    I can't imagine how you would implement such a scheme. For example, forcing Apple to allow non-Safari browsers in the app store is a binary choice, not something you can implement on a gradient. On top of that, market share tends to move around, sometimes a lot, so you would be changing the rules of the game constantly. 40% definitely is low enough to escape scrutiny as a monopoly, in any case. More than half of everyone who buys a smartphone chooses something non-Apple.
    - EGreg 8y ago
      So if every top vendor did that, you'd have something like a cartel, except it wouldn't just be high prices, it would be "once you're in our ecosystem, no more interchangeable parts for you, we own the whole stack". It's a bit like feudalism!
meepmorp 8y ago
Microsoft had a monopoly on the desktop OS market, and so pushing IE was anti-competitive. Apple isn’t anywhere near having a monopoly in phones, in the US or anywhere else. It’s not just the behavior that’s against the law, it’s the behavior plus the market position.

tptacek 8y ago

Isn't the premise of this case, that Apple's "monopoly" on the app store and 30% toll on developers is effectively jacking up app prices for consumers, pretty hard to support with evidence? My impression is that the modern app store coincides with (if it didn't actually cause, which is possible as well) an industry-historic decline in software prices for consumers. Things we pay $0.99 today for used to cost $50.

kodablah 8y ago
The rising tide lifts all technological boats, so it makes little since to compare today with historical water levels. Things can be overall cheaper compared to the past, but still anti-competitively hamstrung. If you can compare to costs of things in the past, you probably won't find any technology more expensive.
- tptacek 8y ago
  That's a colorable argument on a message board, but in court, if intervention is to be premised on harm to consumers through overcharging, Apple's opponents will need to present empirical evidence, not counterfactuals. Be that as it may: all the evidence available to me suggests that mobile app stores have drastically reduced the cost of retail software to consumers. If anything, what I've seen is the opposite concern, which is that app stores make prices too favorable for consumers, at an untenable cost to the developers.
brennankreiman 8y ago
$0.99 or free with all the important features a $19.99 in app purchase each.
- olliej 8y ago
  The is a consumer choice - look at literally every new product announcement that comes with a >4.99 price tag. Basically you get people saying it’s unreasonable because making a copy of an app costs nothing. Because heaven forbid they give any value to the time required to design and create a piece of software. It’s often followed up by claims that they could do it thenselves for much less in much less time, ignoring the realization that that is only possible because the original developer has done all the hard engineering and design work, and worked out how to make things fun, etc. (my most obvious memory of this was when Threes came out and it was instantly cloned by people who had full access to the game design)

BurritoAlPastor 8y ago

Here’s what I don’t get: in what sense is this a monopoly? Consumers have knowledge that the App Store is the only game in town on an iPhone, and they have the option to buy a different phone if they don’t want to use the App Store. That’s like saying that the manufacturer of my vacuum has a monopoly on vacuum bags.

dmead 8y ago
but don't they? i think a more apt analogy would be your trash can manufacturer having a monopoly on trash bags. You shouldn't really expect that to be the case at all.
- BurritoAlPastor 8y ago
  Why is that more apt? Why shouldn’t I expect it? Apple didn’t even invent the walled-garden digital software store; Microsoft was using it on the X-Box in 2005. If you go back to before digital distribution, Sony and Nintendo had total authority over third-party software releases for their platforms since the 90s and 80s respectively. I understand the free-software arguments for why I should be able to run arbitrary code on any computer I own. What I don’t get is the monopoly argument.
  - dirkgently 8y ago
    > Why shouldn’t I expect it? Why should I, as a consumer? I don't understand this argument from Apple apologists. > Apple didn’t even invent the walled-garden digital software store; Microsoft was using it on the X-Box in 2005. So if it wasn't called out then, it should never be called out ever?
    - BurritoAlPastor 8y ago
      “Called out”? Sure. It was called out when Microsoft rolled it out and it’s been called out persistently for ten years, to the point that I’m used to being called an “apologist”. But public criticism is orders of magnitude different from a legal injunction. I simply don’t see how the definitions and aims of a theory of monopoly can be usefully applied to this case.

friendstock 8y ago

30% is a lot to take away from the developers. It's good to have some pressure on Apple to lower their percentage.

HatchedLake721 8y ago
Yeah? Have you ever tried pushing your software during Windows Mobile era?
- dchest 8y ago
  If you didn't use third-party sellers, you could have published your software on your website and accepted payments via any of the "software registration" services or even PayPal. 5-15%.
- Apocryphon 8y ago
  And 30% was a rate that was concocted during that same era, or shortly after. Why should it still hold true now, when Apple's revenue is far greater?

blfr 8y ago

Not being American, this is the one thing I wish Trump/GOP/conservatives did in the US: bust the tech trusts. They're taking the courts, they can surely find state or federal attorneys to bring the cases, and the executive would provide them with cover and enforcement. I'm surprised they haven't done it already. It would make sense for purely partisan reasons because tech companies are very liberal and extremely hostile to Trump's administration. But they could even reach across the aisle with megacorps like Amazon pretty clearly abusing their lower level employees which has been a cause on the left for decades.

anime_forever 8y ago
You're being downvoted but I agree with you even if it's slightly hypocritical coming from the Trump administration
- blfr 8y ago
  It wouldn't be hypocritical for Trump since IIRC he bashed Amazon during the campaign. Probably a little more difficult for the Chamber of Commerce republicans.
  - zachwood 8y ago
    He bashes Amazon because Bezos owns a newspaper he doesn't like.
    - blfr 8y ago
      Perhaps it's a proxy attack but he criticized Amazon's tax practices for putting smaller shops out of business and the supposed preferential treatment by the USPS. Anyway, my point was that it doesn't matter. His administration could do good here for purely partisan reasons.
      - dwaite 8y ago
        The USPS allegation was 100% untrue as reported by the postmaster general (who you think would be someone Trump would have consulted). The tax stuff is really none of his damn business (because it is really a state tax code issue at this point, not a federal issue) If Trump does anything to attack Apple, it will be because he things doing so will benefit the US economy (likely because someone else told him it would). Things like convincing Apple to make certain parts in the US, even if doing so would increase prices in the US (and dramatically do so elsewhere in the world).

lbacaj 8y ago

Unfortunately for Apple, I do think the App Store being an exclusive and default way to purchase and load apps on iOS is in fact causing prices of Apps, in many cases, to be higher than they should be. The perfect example of this is the subscription services, right now you can get a cheaper subscription to a service such as Spotify if you buy it off the App Store. That is a prime example of how much the 30% payment to Apple is hurting developers and ultimately consumers... Apple is so upset about this they won’t let developers like Spotify link to buying the subscription on their own website anywhere on the app that is sold through their App Store, if that’s not Monopoly abuse I don’t know what is. As much as I love Apples products I do feel that they have gotten away with a lot here, especially since there is zero other ways to load apps into iOS devices, in the very least consumers are paying 30% more for apps if there was a competing App Store on iOS that charged less to load apps. Edit: whether the Supreme Court will see it this way or not is a whole other issue.

threeseed 8y ago
Apple provides a service for that 30% though. They handle the payment processing, they build, moderate and curate the App Store apps and they provide a lucrative channel to market for app developers. So allowing Spotify et al to get all the benefits of the channel without paying for it is actually unfair to Apple.
- dd36 8y ago
  So charge the developers for that underwriting service.
- lighthazard 8y ago
  This was true a few years ago but in 2018, it's not a curated place to get software. It's the only marketplace to get software for your device. 30% is disproportionate to what's being offered today.
- samat 8y ago
  This argument will easily hold if there were any way to have a competing store on iOS devices. Apple banning any competition in that field makes ‘buy they provide value for the money’ look like forcing consumers hand. Not sure if I want to have a second AppStore (APNS, etc, etc.)

sjg007 8y ago

I guess the issue is that side loading apps or an alternative App Store is not supported. That and disallowing purchases or rentals on amazon video or kindle apps for iOS.

rixrax 8y ago

Answer is not to give choice in where to download apps. If you don't like Apple app store, then maybe switch to Android or BlackBerry. Or something else. I like being able to go to just one store and get my Apps there. Imagine the horror of having to get the apps from AT&T or Vz store for iPhone, or having to choose if I need to get an app from official store or from another one run by some east European dude from his basement. I love that apple curates the apps and at least tries to get rid of worst offenders whether it's privacy violations or outright malware.

43920 8y ago
If you think the services the Apple app store provides are worth the price increase, then you as an individual consumer could choose to buy apps just from that store. Or you could buy an app directly from the developer, whom you presumably trust (and even if you don't, the app is sandboxed, so the chances of something bad happening are pretty low). Or you could buy the app from an alternative store that's more trustworthy than just "some east European dude from his basement", which would someone would almost certainly create if they had the option to. Plus, Apple isn't just getting rid of the "worst offenders", it's also banning apps with content it dislikes, or that hurt its business model: https://bgr.com/2018/05/25/steam-link-for-iphone-download-ios/ https://bgr.com/2018/05/25/steam-link-for-iphone-download-io... https://bits.blogs.nytimes.com/2012/08/30/apple-rejects-app-tracking-drone-strikes/ https://bits.blogs.nytimes.com/2012/08/30/apple-rejects-app-...
dingaling 8y ago
And yet if an ISP blocked Netflix and made you buy from ISPFlix there'd be wailing and rending of garments. I mean, you could just change ISP to ISP2 if you didn't like it.
- danaris 8y ago
  It's easier to change from iOS to Android than it is to change ISPs in huge portions of the US. At least changing from iOS to Android (or vice versa) doesn't require you to buy a new house and move—probably move far enough that you need to find a new job, too.

zaidf 8y ago

I have recently found myself reconsidering my views on Tim Cook. He has generally positioned himself as the voice of reason, especially on matters of privacy. He’s gone as far as attack companies like Google and Facebook. And yet, all of this masks a simple truth abt Apple: any extra privacy or consumer protection comes at a very hefty cost, making most of its products unaffordable for most of the world. In contrast, Google’s Android is affordable for many large markets Apple doesn’t find worthy of competing in.

nradov 8y ago
In principle there's nothing stopping Android device manufacturers from respecting privacy by using AOSP without Google services. However in practice such devices have either been market failures, or are even worse from a privacy standpoint (i.e. infested with Chinese government spyware).
- samat 8y ago
  Until very lately there were secrect mandatory agreements with google which made device manufacturers unable to sell devices with and without googles software at the same time. You had to choose one.

kitsunesoba 8y ago

Perhaps it’s an unpopular opinion, but I’m hopeful that this doesn’t go anywhere for the simple fact that I don’t want to have to keep 5 different app stores installed to have access to everything. It would be cool to have an iOS equivalent of F-Droid, but I’d rather that not come at the cost of scattering commercial iOS apps across stores. I’m not keen on the idea of non-WebKit web engines on iOS either because it will inevitably enable a huge contingent of lazy web developers to just display a “screw you and your device’s battery, go download Chrome” message rather than bother with crafting their sites and web apps in a web engine agnostic way. It’ll be just like when IE was the dominant browser, except this time around the dominant engine is favored by web devs and will continue to be thanks to Google’s web-centrism.

vedantroy 8y ago
I think its good to force Apple to allow non-WebKit web engines on iOS. Right now Apple can forcefully cripple technologies like progressive web apps by not supporting the latest web technologies. This allows Apple to force companies to develop native applications. Similarly, Apple has been slacking off on improving Webkit and making it as good as V8. By getting rid of Apple's monopoly on web engines, developers will be able to push websites to new levels that are currently hard to attain.
- koolba 8y ago
  I’d be more than happy for a WebKit browser with a fully customizable noscript and cookie policy.
- throwaway34241 8y ago
  As long as Safari remains the default or very popular, sites will probably have to support it anyway regardless of if other browser engines are available. There's also some conflict of interest if say Chrome were to come to be the dominant browser on iOS since they also control Android. Would battery life, performance etc be prioritized as highly on iOS as their own platform? I think it would be nice to be able to load apps from outside the app store especially on devices like the iPad Pro, but I think that's a separate issue from web standards. I think the only practical way to advance web standards is for the major browser vendors to agree and implement them, even if that sometimes takes a while.

askaboutit 8y ago

Apples total lack of PWA support is a real pain. Making a mobile app is 10x the investment of a PWA and most ‘apps’ would be better off as a website. This issue is annoying me more and more lately as Apple simply wants to hold back so many things. All so they can take 30%.

scarface74 8y ago

So if Apple loses what does that mean for the stores for the PlayStation, XBox, and Nintendo.....

ajross 8y ago
Presumably they'd be open to the same kind of suit, which IMHO is appropriate. The issue at hand here is standing: do consumers have the right to sue for antitrust violations or is that limted to the app/game vendors who paid the markup most directly? The supreme court isn't going to decide on the merits of the specific case (because the original case in district court was thrown out due to standing -- this is the appeal of that decision) or whether or not Apple's 30% cut is appropriate.
sdinsn 8y ago
I don't think that's a fair comparison, since I can buy hard copy games from a variety of stores in addition to buying digital games. I can't buy hard copy iPhone apps.
- scarface74 8y ago
  Yes you can but hard copy games, but guess what? Those games still have to be approved by the console maker and won’t run unless they have a digital signature from the console manufacturer. It’s been that way since the 80s.
  - sdinsn 8y ago
    I've developed homebrew games on multiple platforms. I know that NES, GBA, PSP, and DS have little to no restrictions. The Wii has a few restrictions, but not many.
    - scarface74 8y ago
      So exactly how did you get those games on actual hardware or did you run them on an emulator? You definitely didn’t get games distributed on unmodifurd PlayStations, Nintendos, or XBoxes. Nintendo has had a lockout system since the SNES days. https://en.wikipedia.org/wiki/Atari_Games_Corp._v._Nintendo_of_America_Inc https://en.wikipedia.org/wiki/Atari_Games_Corp._v._Nintendo_....

bubblethink 8y ago

I feel that all these measures are stop gaps at best. The fundamental thing you want is for customers to install whatever software they want on the hardware they buy. For mass market devices, it really ought to be a law that requires the manufacturer to allow consumers to do whatever they want. The manufacturer doesn't need to support these modes, and that's fine. Once you have that, the rest falls into place. This was the idea behind GPLv3 and anti-tivoization, but it never caught any traction for anything that matters.

amoitnga 8y ago

In today's world successful business often requires online presence online presence requires app to have an app my business "has to be approved by Apple" That's a freaking monopoly.

eridius 8y ago
Why does an online presence require an app? Most "online presences" still don't have them and do just fine.
- amoitnga 8y ago
  it is sort of "expected". People want a native experience. To me, the entire concept seems wrong. It's like having to submit your website to chrome, and safari, and mozila, and be approved by them, for them to display your site... Don't you think it's wrong? Who are they to decide what I can or can not install on my device?

tokyodude 8y ago

IIUC if Apple loses then there may finally be better way to get GPLed software on iOS/tvOS. I currently run Kodi on my Apple TV but I had to compile and sign it myself because they can't put it on the Apple store without an alternate license AFAICT. Unfortunately while I personally think Apple should allow other app stores I don't think this particular suit will succeed. https://www.theverge.com/2018/6/20/17479480/supreme-court-apple-vs-pepper-antitrust-lawsuit-standing-explainer https://www.theverge.com/2018/6/20/17479480/supreme-court-ap...

dwaite 8y ago
IMHO, the reason some GPLed software is not allowed on iOS/tvOS is because RMS and others don't want their GPL code on iOS/tvOS. In particular, the argument I've seen used in the past to contest GPL code in App Store apps is that Apple (as distributor) must distribute the source directly on the App Store, rather than the application or the App Store description having a link to the source via the developer's website or another third party site. This isn't something Apple really cares about - but if someone says your app has a license violation, Apple will of course push dealing with said people onto you. This has always stuck out to me as pedantic and hardly a violation of the spirit of the license. Such politics are what have and will continue to relegate the FSF to being a small social group rather than the originally intended purpose (whether you consider that a revolution, or a reversion back to software freedom)

chipotle_coyote 8y ago

Folks here on HN are (understandably) leaping on the notion that this will force Apple to allow other app stores, or sideloading, or something else that keeps the App Store from being the exclusive distributor of iOS apps. But, a few notes that are important to keep in mind: (1) Apple is the petitioner here. They're the ones asking the Supreme Court to make a ruling, specifically on whether the complainant has the legal standing to bring this case at all. (2) If Apple loses at the Supreme Court, this just gets sent back to a lower court. It's not going to force Apple to do anything at this point. (3) Most importantly, there's no guarantee that if Apple does ultimately lose that the remedy will be opening the iOS ecosystem up to other app stores. The complaint in Apple v. Pepper is literally that Apple's lock on app distribution drives up app prices. If app prices are not being driven up by that lock, the argument has a very good chance of falling apart. This is not a case about what restrictions Apple puts on the app store , about software or device freedom, and it's not even a case about whether Apple's mandatory 30% cut is "fairly priced" by whatever definition of fair you care to use -- the case as filed literally hinges on the claim that iOS app prices are artificially inflated by that cut. And I think that in a world where people have been trained to think that $4.99 is a crazy high expensive price for software, that could be a real tough case to prove.

auslander 8y ago
> Folks here on HN are (understandably) leaping on the notion that this will force Apple to allow other app stores I'm leaning in quite opposite way. Apple enforces security and privacy policies of its store apps, which is main reason why it is much safer to use than Android. As for app prices, Apple Store is an open competitive market, no apps are restricted to compete. I see the point being moot. Adtech industry would love to see Apple lose though, don't let them.
- daveFNbuck 8y ago
  > no apps are restricted to compete Apps are restricted from competing on price. I can't release a 79 cent app to compete with a similar 99 cent app.

balibebas 8y ago

I'm looking forward to the day I don't have to charge a non-profit doing good in this world $99 a year just to keep their app on the app store. Apple devices should have the equivalent of F-Droid for FLOSS goodies, and that's exactly the conclusion the courts should decide on IMO. This of course will make Apple devices less secure. But then again the current state of affairs is arguably worse given the lack of competition.

sodosopa 8y ago

Seems having an open iOS AppStore is just an incentive for crap apps. Not to say iOS doesn’t have them currently, but not matching the levels of Android

sharemywin 8y ago

If Microsoft wasn't allowed to bundle a browser with the operating system, not sure an app store should be bundled either.