Microsoft was dragged through court for it's aggressive browser install on windows back in the day. Now everybody is getting rich off apple stock and there's not much incentive to hold them to the same standard. They even started with a monopolistic policy - if it's duplicating functionality they'll remove it from the app store. People keep buying iPhones because they don't care.
The difference is market share. There was no effective alternative to Windows ecosystem at the time (arguably there still isn’t). The issue was also broader than just bundling the browsers: there were contracts with OEMs that effectively entrenched Windows as the only OS they were practically shipping (not dissimilar to Android contracts with the OEMs). Last time I checked most people don’t even have iPhones.
Except that nobody is alleging they have a monopoly on phones. The market of concern is the app store. Which they obviously have a monopoly on because a customer with an iPhone can't use any other store, and a developer with customers who have iPhones can't distribute to them using any other store.
It's like claiming that nobody can have a monopoly on electric car charging stations because the customer could just buy a gasoline powered car and electric cars don't even have majority market share. It's still a monopoly. It's a monopoly on charging stations, not a monopoly on cars.
If one company (let's say, Tesla) owned half the electric car charging stations in town, and another company (let's say, Nissan) owned the other half, and Tesla's charging stations could only be used on Tesla vehicles and Nissan's charging stations could only be used on Nissan vehicles, would you conclude that both companies have monopolies?
> If one company (let's say, Tesla) owned half the electric car charging stations in town, and another company (let's say, Nissan) owned the other half, and Tesla's charging stations could only be used on Tesla vehicles and Nissan's charging stations could only be used on Nissan vehicles, would you conclude that both companies have monopolies?
Yes, of course. The fact that you can't use the other company's chargers means that there are then two markets there, one for Tesla-vehicle charging stations and one for Nissan-vehicle charging stations. You can't substitute one for the other in that case, you need one compatible with your car. It's the same reason that gas pumps aren't the same market as electric car chargers, or that gas pumps aren't the same market as diesel pumps. If there is only one diesel pump in the state then it has a monopoly no matter how many gas pumps there are because you can't use gasoline in a diesel vehicle.
If you could use either type of charger with either type of car then they would be in the same market, because a customer who wants to charge their car could substitute either one for the other, so they would each actually be in competition with the other and neither would have a monopoly.
I think the fact that the "chargers" and the "cars" are hypothesized to be operated by the same company is what's messing people up.
Suppose you have two companies that each operate half the charging stations in the same region. One is Tesla, and you can only use them to charge a Tesla vehicle. The other is Exxon, which has started installing electric car chargers at their gas stations, and where you can charge any car including a Tesla. Well then Tesla hasn't got a monopoly on anything, because any Tesla owner can go charge their car at Exxon, and Exxon doesn't have a monopoly for Tesla vehicles, because they can also go charge their car at Tesla. But Exxon does have a monopoly for charging non-Tesla vehicles, because if you have a Nissan or a Chevy, you can't use the Tesla chargers, leaving Exxon as your only option.
So, under current US case law, the courts have generally found companies to be not liable for "aftermarket" antitrust claims if:
1) The manufacturer lacks sufficient market power in the "foremarket". (In the case of Apple, this would be the sale of the phone. In your example, it would be the sale of the car.)
2) The consumer was aware of the "aftermarket" restrictions when buying the original product. (In the case of Apple this would be the App Store pricing and rules. In the car example it would be the ___location and cost of the charging stations.)
3) The consumer does not face substantial costs to switch to an alternative product. (The cost of buying a new car would probably be considered substantial but I'm not sure a new phone would.)
The courts have reasoned that if the consumer had sufficient information when making their initial purchase decision, then they had the opportunity to buy a competing product without those restrictions. If they went ahead and bought anyway, they knew what they were signing up for. It's like buying a razor and then being stuck with expensive replacement razor blades. Or buying a movie ticket and then being stuck buying expensive popcorn from that theater.
Yes, once you buy the movie ticket and enter the theater they have a "monopoly" on your snack purchases. No, you're not likely to win an antitrust claim against the theater.
> 3) The consumer does not face substantial costs to switch to an alternative product. (The cost of buying a new car would probably be considered substantial but I'm not sure a new phone would.)
The cost of switching phone platforms is massive compared to the app market. Phones can cost over $1000, apps are commonly $1, a difference of a thousand fold. And that's only the hardware cost. Then you have issues if there is any other app you need which is only available on one platform, or if you make use of Google or Apple services that are only well supported or supported at all on one platform and would incur substantial switching costs to move to the other.
You also have a different problem here:
> The courts have reasoned that if the consumer had sufficient information when making their initial purchase decision, then they had the opportunity to buy a competing product without those restrictions.
Which would only apply if there was a viable competing product without those restrictions. But there are only two viable phone platforms and Apple's has a strict monopoly while Google's has a de facto one where Google Play has >90% share of the Android market, and they both impose similar restrictions, so a viable option without those restrictions isn't there.
Furthermore, the customer for app distribution is at least as much the developer as the user -- they're the one who pays the app store's fee, right? -- and they don't get to choose which phone their customers have already bought.
> The cost of switching phone platforms is massive compared to the app market. Phones can cost over $1000, apps are commonly $1, a difference of a thousand fold. And that's only the hardware cost. Then you have issues if there is any other app you need which is only available on one platform, or if you make use of Google or Apple services that are only well supported or supported at all on one platform and would incur substantial switching costs to move to the other.
Ultimately that is up to the courts to decide. But I will point out that in a previous case involving IBM S/390 computer systems, the court decided this requirement was not met, despite the hardware expense and associated software compatibility limitations.
> Which would only apply if there was a viable competing product without those restrictions. But there are only two viable phone platforms and Apple's has a strict monopoly while Google's has a de facto one where Google Play has >90% share of the Android market, and they both impose similar restrictions, so a viable option without those restrictions isn't there.
I'm not sure which specific restrictions you are referring to here. If the complaint against Apple is that you cannot install apps from 3rd party sources on your iPhone, there is a competing product that allows you to do that on the market.
> Furthermore, the customer for app distribution is at least as much the developer as the user -- they're the one who pays the app store's fee, right? -- and they don't get to choose which phone their customers have already bought.
This is not relevant for antitrust purposes. Developers are not entitled to demand a specific company give them access to that company's users.
It doesn't matter if Apple has a monopoly or not, they can bully other companies all day long anyway since they got the most lucrative users and you can only reach them via Apple phones. If there is no law to handle this case then we need to create one since the current situation is obviously bad. It is kinda like how workers can get bullied by companies since the worker is so much smaller, Apple is way less dependent on app creators than the app creators are on Apple creating an unhealthy power imbalance. Such power imbalances needs to be regulated.
The App Store is an Apple product, of course they get a monopoly on designing and implementing it.
Any mechanism for side loading apps would also be an Apple product, designed and written by them. They would be responsible for supporting it, and ensuring it was secure. Maybe they don’t want to do that, so who gets to force them to, and who gets to decide if they complied with that directive? Who gets to specify it and take responsibility if it causes problems and incurs costs on Apple or issues for their customers?
You’re not talking about stopping Apple from doing something, you’re taking about coercing them by legal requirement to do new different things, and you’d better be very specific and careful about what you are forcing them to do.
Apple certainly has the majority of the market when it comes to app store purchases.
And the government doesn't classify trusts[1] by the dictionary definition of monopoly:
> 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.
If the state hadn’t intervened on behalf of defending Netscape’s commercial interests we may have gotten decent open source browsers a few years earlier than we did.
The market solved the problem in ways that the DoJ couldn’t have anticipated. It turned out that licenses fees for closed source web browsers were just not something that businesses and consumers were interested in putting up with.
Few remember how much of an equal offender Netscape was when it came to proprietary extensions to the web.
Microsoft was taken to court for three reasons - forcing OEMs to pay a license fee for each PC sold whether or not the OEM shipped the PC with Windows, Office Productivity monopoly and the browser.
It wasn’t until 2010 that IEs market share started eroding. It didn’t have anything to do with the government.
Almost 20 years later, MS still has the same market share in both operating systems and office productivity and no one cares about browser dominance except for Google.
When MS was under investigation they were the most valuable company in the US. Now they are number 3.
