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Apple’s “monopsony” power, and the woman who named it

311 pointsby moorageover 5 years ago

18 comments

braythwaytover 5 years ago
Amusingly, there are two sets of people arguing about why Apple is bad, and each have their own argument:<p>1. Android sells more, and offers more variety of mobile and wearable devices than Apple. And here’s the data to prove it.<p>2. Apple is a monopoly&#x2F;monopsony and should be forced to allow more user choice of apps, allow sideloading, lower their prices, lower their app store cut, &amp;c.<p>Which one is is?<p>Apple is like Tesla. They don’t sell more cars than anyone else. They don’t have a stranglehold over vendors. They sell more <i>luxury</i> cars than a bunch of other people. And while you see lots of Teslas on the road, you still see more F-150s.<p>Their market is insanely profitable, and for many developers, their little market is highly profitable. But how is it their fault that app developers don’t shun them for Android-only, or Windows (do they still make a phone OS?)<p>Apple make their own devices. They don’t license an OS and then use shenanigans to force vendors not to offer consumers a choice, like Microsoft did.<p>They make a desirable product, and offer developers a desirable market. But they don&#x27;t have enough of the market to do whatever they like.<p>They can’t charge $5,000 for a phone and succeed because of network effects. Android phones can call and text Apple phones.<p>They don’t tell developers that apps must be iOS-exclusive to be in the app store.<p>Apple’s current success is exactly what the free market is for. People may grumble about the price of a phone or the keyboards, or the app store cut, but those who pay it do so because the value is there, not because of arbitrary constraints.<p>They aren’t Facebook. Nobody has to buy an iPhone to keep in touch with all their friends who have iPhones.
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pornelover 5 years ago
Apple made themselves an exclusive payment provider for all iOS in-app subscriptions and payments for digital products. Merely mentioning anywhere that cheaper payment options exist is an AppStore ToS violation.
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lilyballover 5 years ago
Something odd about this argument is the fact that 30% is pretty much an industry standard. Apple isn&#x27;t jacking up the price.
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GeekyBearover 5 years ago
Next up: Nintendo, Microsoft and Sony&#x27;s game consoles?
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vturnerover 5 years ago
The key point I presume is the definition of &quot;market&quot; here; and I&#x27;m not convinced the market &quot;software that runs on iOS&quot; is so large that monopwhatever can be declared there and used to justify price control.<p>Though as a thought experiment Apple is like a wealthy landed gentleman who sets up a well maintained outdoor market for the tradesmen to bring goods and the lower classes to buy them. If Apple owns so much land they are the only ones capable of setting up a large enough market, maybe we should regulate that gentleman&#x27;s fees to the tradesmen? By virtue of people&#x27;s need to be fashionable and the enormous cost to develop a smartphone and OS, Apple effectively controls enough &quot;land&quot; to warrant regulation. I don&#x27;t know...<p>Finally, this rationale also it seems causes a dilemma with B2B relationships. What if your market is quite specialized? Are you a &quot;monopsony&quot;?
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RandallBrownover 5 years ago
So, since Apple is the only company &quot;buying&quot; apps from developers, they could raise their cut as high as they want and developers can do nothing about it.<p>Could Apple then argue that they aren&#x27;t the only game in town because of things like subscriptions and web apps? (e.g. I don&#x27;t pay for Netflix or Spotify through Apple, but the apps work fine)
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m463over 5 years ago
so:<p>- monopoly: the only seller<p>- monopsony: the only buyer<p>So app store customers can only buy from apple.<p>And the app developers can only sell to apple.
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dfsdfklgjljgover 5 years ago
This title is complete bs, and the court ruling (linked in the article) only mentions monopsony very briefly.<p>The question addressed by the court is regarding who is the cause of any overcharging to the customer. The opinion argues that because Apple is exclusively dealing with the customer, it is able to sell on whatever terms it wants to the customer, so any overcharge is their fault. The dissent argues that because the developer has the power to dictate the price of the app on the store, any overcharge the customer pays is directly caused by the developer, because the developer could have chosen to sell the app at a fair price.<p>It is true that the ruling mentions that developers may sue apple, but that was never in question. Both the opinion and dissent agree on that fact.
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_-dobe-_over 5 years ago
In the EU we had a ruling that forced Microsoft to offer choices for web browsers when installing Windows for the first time. I.e. IE wasn&#x27;t set as the default browser by default. They were forced to do this for 5 years, I think so people become aware that there are other choices out there besides IE. They should do the same for the AppStore. When you set up your iPhone, it should give you an option of AppStores, not just the Apple one.
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runeksover 5 years ago
So, via legislation (e.g. DMCA), we give Apple the right to tightly control the use of its “intellectual property” (the iOS software), which results in Apple being the only entity that can legally offer iOS apps for purchase.<p>And now, via legislation, we want to remove this power, first given to them via some other legislation.<p>How about we critically assess current legislation, instead of just piling more on top of it?
andojuover 5 years ago
Arstechina published similar article regarding Apple&#x27;s monopsony in 2005...nothing changed from last 15 years<p><a href="https:&#x2F;&#x2F;arstechnica.com&#x2F;gadgets&#x2F;2005&#x2F;09&#x2F;1190&#x2F;" rel="nofollow">https:&#x2F;&#x2F;arstechnica.com&#x2F;gadgets&#x2F;2005&#x2F;09&#x2F;1190&#x2F;</a>
Animatsover 5 years ago
If you don&#x27;t know what monoposony is, ask a farmer.
alfonsodevover 5 years ago
I think 30% (15% after a year) would be all right if there was another way for the user to install the app by downloading from vendor website.<p>I know part of the value proposition of Apple is actually not letting user download apps from sites, but then something like Udemy model where the cut varies if you bring the user or they bring the user, could make sense.<p>Then Apple taking the cut as referral wouldn&#x27;t feel that bad.
LockAndLolover 5 years ago
&gt; But Kavanaugh went further. He said Apple could also be sued by app developers, most of whom are forced to fork over a big percentage of their potential revenue, &quot;on a monopsony theory.&quot;<p>Is it possible for users to easily install alternative app-stores? Wouldn&#x27;t that solve the problem?
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musicaleover 5 years ago
How do Apple&#x27;s licensing and payment policies for the (iPhone, iPad, Apple TV) compare with those of other game and streaming device manufacturers?
generalpassover 5 years ago
Modern definition of all definitions in the United States:<p>See: SCOTUS decisions.
oleganzaover 5 years ago
&quot;Merchants at Macy&#x27;s can only sell at Macy&#x27;s&quot;.<p>There are many options for you as an app developer. You can enjoy the scale and tooling provided by Apple, at one cost. Or you can write apps for any other computer at some other cost.<p>Or you may choose not to be an app developer at all and do something else useful.
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mikeceover 5 years ago
Having Apple take a 30% cut of sales in exchange for not having to run an e-commerce operation is far less odious than having to pay $5,000 for a MacBook Pro which has less RAM, a smaller SSD, and less powerful processor than $2,500 worth of Dell, Lenovo, HP, or Acer gear. The hardware is the real rip-off to me. I would gladly pay a reasonable fee if I could write my apps in VS Code on Debian and then ship the code to an Apple service to compile the code.
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