Monopoly is not illegal. Concentration of power defines monopoly. Recognize that AppStore is a defacto monopoly by design exactly as SteveJobs intended. Anti-trust law seeks to maintain market competition even in legal monopoly. Telephone was gov’t sanctioned monopoly until MaBell was broken up into BabyBells.
API proprietary IP owned by Apple are assets it chooses to share with covenants that their use in software applications for the iOS platform be transacted across Apple’s AppStore. So far NBD.
AppStore provides an unpublished list of checks and balances to enable software in iOS applications enables a MVP UX on iPhone e.g. consistency, human factors, conventions and security. Big deal for users. BIG deal for Apple, brand. HUGE for AAPL, revenue.
Apple applications use proprietary IP developed, owned and included in an operating system that forms a suite of normal, ordinary minimal functions expected from an Apple product. It neither publishes nor shares unpublished API’s on which these applications depend. Deal for users, Big deal for Apple, product. Huge for FTC.
Apple maintains low profile improvements, extensions and upgrades slowly to its proprietary applications because Apple can’t be seen to compete against 3rd party apps in its AppStore. HUGE deal to Apple, Big deal for FTC, HUGE deal to developers.
Story behind this conflagration begins when iOS didn’t exist nor MacOS X. NeXT Computer Inc., SteveJobs’ answer to Apple non-compete agreement upon ouster from his baby Apple deliberately chose to control the future. Unlike what SteveJobs experienced creating Apple only to be kicked out, $24M richer. Steve had lost his baby. NeXT would build upon open source, free software operating system BSD (Berkeley unix) combined with open software research kernel Mach by Avie Tevanian. Since 1999 these acknowledgements were lost as Apple corporation renamed them MacOS X and Darwin respectively. So far so good open source, good NBD.
NeXT would continue to contribute to the open sources it used, add proprietary extensions and even develop EEC (Elliptical Encryption Code) to NeXT API’s. It spent 6 years alone writing device drivers, perfecting then ultimately abstracting the printing layer over the printer device space (ADOBE) HUGE deal for AAPL, HUGE deal to SteveJobs, HUGE to NeXT. NeXT written proprietary applications formed essential core functionality within it NeXTSTEP OS. A desktop workstation class computer sold direct to business ergo non-compete with Apple consumer products.
NeXT would falter. Despite its performant unix, graphical UI and innovative architectural abstractions over CPU, printers and a write once run everywhere development environment; businesses, WallSt enterprises, weren’t buying. SteveJobs’ would define it as a result of a natural monopoly of two. There was Microsoft and Apple. There simply was not room for a third. Which ended in Apple acquiring NeXT and SteveJobs as its Macintosh run out of legs and it couldn’t build a new Macintosh in time to save itself.
Takeaway in natural monopoly where exist few companies, anti-competitive practices emerge. Collusion emerged that Google and Apple agreed to not poach each others engineer talent, out-price talent in bid-wars and exchange employee intel if it did. SteveJobs’ hands were slapped as the gov’t saw Apple was struggling. CEO’s learn to avoid obvious violations.
It is much easier if Apple addresses a competing product through its efforts have it bettered by design, integration or architectural innovation - obsoleted. In the instance of foundational applications that address core competencies, better someone else than you is seen buying a threatening company out of existence. All other instances, AppStore controls, covenants and restrictions apply universally to limitations against encroachment of Apple, its API’s and its operating system vulnerabilities. Apple uses AppsStore to ensure a stable user platform, predictable API’s and consistent user experience.
AppStore controls Apple destiny, applications its future and profit its legacy. BIG Hairy Deal to AAPL. SteveJobs wanted to give people a computer they could love. With iOS he found a subset of computing in handheld mobile that was a natural fit for NeXTSTEP. In a chicken or egg argument, SteveJobs had seen that he had both. He could own the mobile cellphone market and already had a computer system that could make a smartphone better. What he also knew, is that he could use software to obsolete keyboards and buttons. He didn’t know that applications were the gold stake in the race to marketshare.
AppStore was SteveJobs concession to developers that Apple open its iOS platform to 3rd party developers. Apple was his baby. He would concede to those developers and those apps that could sell more idevices. Demand for applications exceeded Apple talent. SteveJobs learned that industry engineers could better design, develop faster and market quicker than any single company. Intel little/big endian wars put to rest in-house superiority back in NeXT days of Motorola cpu dependency. AppStore would explode in success beyond all expectations.
AppStore exists as a monopoly within a natural monopoly which is causing a conundrum. How do you rectify one without damaging the other? Remedy by conventional measures all fail that test.
SO first principles, would the richest corporation in the history of the world lose its natural monopoly without an AppStore? No. And if not, why? Apple has at its disposal resources, talent and power to co-exist in a 3rd party developer community of equals, if I may use the term colloquially. Let it make idevices. Let developers develop applications. All for one – one for all.
Divest it of its proprietary applications, preferential app lock-ins and open the architecture of its platforms. Direct it to abstract the lock-in layers, proprietary API’s and expose the unpublished hooks that are safe to allow 3rd party developers access.
THUS hold Apple to the founding first principles upon which SteveJobs built the whole software system. Level the playing field for Apple to compete on the same level developing software as do the developers who write applications for its idevices.
Computing has changed. Apple has chosen SoC as its destiny. Applications no longer occupy that hallowed rank. Timing is right. Thanks to Apple’s own M1 chip initiative, it no longer is dependent upon applications as much to sell idevices. M1 synergies should lead Apple onto its next innovations.
Applications will grow into a healthy sector of the economy. AppStore can critically help support WFH application development in a pandemic era. The world needs AppStore and it will be a better world no longer wrapped in monopoly existence.
AppStore is one of the only Apple entities to emerge NOT Apple branded in a way that could stand on its own outside of Apple. But no, SteveJobs hadn’t thought that far into the future. Some things are natural. FTC should cut it and its name loose.
related: see “Epic fog of monopoly” post on this substack