> If the result of this case is "you can have a monopoly as long as your device and ecosystem are 100% locked down", that's terrible!
The rule of thumb, in a very simplified way, is indeed that you can have a monopoly as long as you don’t actively leverage that power to stifle competition.
That’s not a result of this case but a result of all the jurisprudence leading up to this case.
And to a certain degree, that makes sense. The alternative, making all monopolies illegal, would cause too much havoc because it would affect almost everyone putting out a product.
Say, for example, you’re a newcomer in the market of smart thermostats. By definition, you have a monopoly on your thermostats.
If monopolies are by definition illegal, regardless of circumstance, you’d have to allow Nest to put software on your thermostat advertising their products.
That’s an undesirable outcome, if only because it makes it harder for you to compete in that market.
I don’t think that’s even close to the spirit of the law. Monopolies are bad because they artificially limit consumer choice and market dynamics resulting in a product that’s more expensive and generally lower quality. If you intentionally limit competition where there would otherwise be a healthy ecosystem, you’re a problem, even if you have a cult of believers.
By the same logic, other phonemakers can come over and make phones. The definition of what is a "market" is arbitrary and subjective. Google may be a monopoly in internet search, but only a small player in "global advertisement". And anyone anywhere is a monopolist in the very narrow definition of the market that includes their own ten customers.
What's really important is the power play: your company should strive to hold a comfortable and stable monopoly position in a meaningful market (meaningful to you), while the government's role is to watch over all the businesses so that large numbers of people are not under heavy influence of external forces and not made unhappy. If any product exploits its monopoly by shifting the power from the government or making people sad, then gov steps in and interprets the rules in the way to correct this. Or, the gov is corrupt and helps keep that monopoly going :-)
How about a _market_ is anything where there exists a _marketplace_? Doesn't seem like a wild stretch. Now why should Apple have a monopoly on accepting payments on its platform?
To your second point: people are sad that we can’t have cheaper and better software on iOS. It’s a poor UX when an app makes me go on my desktop to sign up for their paid service. It negatively impacts consumers and only exists because Apple is wielding its monopoly.
No, I’m saying that almost everyone has a monopoly over something just by creating a new market.
This is why monopolies aren’t illegal per se, and it requires a couple of components for it to venture into unlawful territory.
One is that the monopoly is powerful enough that it can be exerted to pressure other parties in an anti-competitive way, and another is that that power is actively used.
There are more, but for the sake of simplicity, these are the important ones in this debate.
Disallowing competitors to exist, in this case, means passively making it possible for competitors to exist.
The omission of an act (passive) will never be as substantial as an indicator as an active act to quash competition.
The App Store hasn’t changed much since its inception. Commission rates have decreased since its inception, making it harder to argue that Apple is squeezing developers now that it has more power.
The analogy with the thermostat hypothetical is accurate.
If I create a new smart thermostat startup, I create a new market, the software distribution on the thermostats I manufacture.
This is analogous to the market definition people use to argue that Apple is violating antitrust laws. If it makes it easier to grasp what I'm saying, then instead, imagine I start manufacturing a new smartphone.
They launched the iPhone and, by doing so, created a new market, the iOS app distribution market.
The only difference is that the iOS app distribution market has grown exponentially, but the relevant legal realities are the same.
The law currently doesn’t have a mechanism to say, “Ok, now you’ve grown, so now it’s illegal.”
Instead, it looks at abuse of power, where acts weigh heavier than the omission of acts.
The main difference between the Google and Apple’s case is that the former went out of its way to stifle competition by making demands and setting requirements (akin to Microsoft back in the day).
Some now say that the only reason this difference exists is because Apple doesn’t have to pressure others like Google did, but that’s not a difference to be shrugged away. It’s an essential difference.
It makes the difference between one giant who throws its weight around and another who never had to do that because the terms have been the same from the get-go (however favorable it was for them).
It is for that very reason that the Google case won’t have much bearing on the Apple case.
The rule of thumb, in a very simplified way, is indeed that you can have a monopoly as long as you don’t actively leverage that power to stifle competition.
That’s not a result of this case but a result of all the jurisprudence leading up to this case.
And to a certain degree, that makes sense. The alternative, making all monopolies illegal, would cause too much havoc because it would affect almost everyone putting out a product.
Say, for example, you’re a newcomer in the market of smart thermostats. By definition, you have a monopoly on your thermostats. If monopolies are by definition illegal, regardless of circumstance, you’d have to allow Nest to put software on your thermostat advertising their products.
That’s an undesirable outcome, if only because it makes it harder for you to compete in that market.