> those using an alternative payment method still must give Apple 27% of income
While 27% is higher than expected, everyone knew Apple would (and had the right to) impose a fee for alternative payment methods. There isn't a magic flag you can wave to avoid paying Apple if you are accepting payments in an iOS app.
> app developers have to produce an entirely new app
This is the part the Dutch court slapped down. The development concerns in the press release are overblown, though ("must develop a completely new app") since it's more like you must submit a new app that uses the new entitlements.
I’m not sure where you’re getting the idea that a commonly agreed upon legal fiction has “rights”. “We the people” are the ultimate arbiters of what companies can and cannot do, in this case the government of the Netherlands acting on behalf of the people of the Netherlands is going to say what Apple can and cannot do in the Netherlands.
Apple has no “right to profit”… no company does. They are *allowed* to profit.
>I’m not sure where you’re getting the idea that a commonly agreed upon legal fiction has “rights”.
He's not describing how things ought to be, just how it is right now, given the current laws. If you really want to boil things down, the "rights" you have (guaranteed by the constitution or whatever) are a "legal fiction" as well. The ultimate arbiters of what you can and can't do are the Men With Guns working for the government. They can go away the next day if there's a coup.
This is a pretty bad argument, because it conveniently omits that antitrust regulation is also extremely open-ended. Sure, Apple has the right to profit however they see fit. The government also has the option to smack them down however they please; just a few months ago the DOJ and SEC demanded that Apple started unloading their liquid cash or risk a lawsuit. Why? They simply made too much money. That's all it was.
I think the simple explanation is this: if Apple continues to make money with the insane software margins they have today, they're going to face regulatory action. The cat is out of the bag, developers are pissed off, and more than half of the states in the US have come forward in opposition to Apple's monopoly over iOS app distribution. Just short of incorporating in another country, there's very little Apple can do to maintain their status quo without some kind of regulatory action coming down the pipes.
Irrespective of App Store rules and such, the idea that people acting through a company lose their rights has to die. A company is simply an organisational structure the owners, managers and employees use to exercise their rights and freedoms. We exercise our legal rights, in the context of our employment, all the time. Owners of companies also have a reasonable expectation to use the companies they own to exercise their rights too.
The same arguments used to attack the activities of companies could be used to restrict political parties, or undermine the activities of charities. It’s a dangerous road to take. Commercial groups have been recognised as legitimate vehicles for the exercising of rights for hundreds, even thousands of years. There’s nothing new about it, and it’s been recognised in legal systems throughout history across the globe.
"Owners of companies also have a reasonable expectation to use the companies they own to exercise their rights too."
This seems neither logical nor to have any legal basis. You have many rights related to privacy and sexual reproduction that can not and should not be exercised through companies.
There is also laxk of responsebility, if you commit crimes individually you will be in jail for the rest of your life, but companies get away with it regularly. Both due to power of money and diffusion of reaponsebility
It makes sense to exercise some rights though a company or similar organisation, such as a charity, NGO or political party, and not others.
>This seems neither logical nor to have any legal basis.
As I said, it has a long history and sound basis in common law jurisprudence in the west going back at least to medieval law, and in other cultures going back even further. The very word corporation, or incorporation (corpus being Latin for body), expresses the principle of representing and acting on behalf of a body of people.
If we're talking about how things ought to be, I think the power that "we the people" can have over peaceful transactions between private entities ought to be much more limited than it is now. The sledgehammer of government intervention should simply not be used to mediate private, voluntary interactions.
Apple basically created the entire idea of a mobile app marketplace, transforming the entire industry with sheer innovation. They did this in an environment where they were not protected by regulation from market incumbents (anyone heard of RIM lately?) the way it is proposed to do now. Where is the justice in taking this thing that Apple has built, to all our benefit, and forcing our terms on it. The App Store is Apple's. It should be allowed to charge whatever it wants, set whatever terms it pleases, and burn it to the ground if it sees fit. Seeing Apple's creation as somehow collective when we have done nothing but queue to pay for the privilege of using it is monstrously entitled and unjust.
You speak of Apple as if it were an individual or a small company run by a tight group of friends.
AAPL is not a courageous pioneer being oppressed by "The Man". AAPL is a trillion-dollar institution that by design exists only to pursue profit and enrich its shareholders, the overwhelming majority of whom can take exactly zero credit for the innovations from which they profited. It is "The Man".
Apple was at one point in recent history a small company run out of a garage by a group of friends. At what point exactly did it lose the rights it was entitled to then? If 3 dudes in a basement are entitled to sell goods/services on their own terms, then Apple should be as well. Where is the line? Apple is still a private company, not a public service, and the case I'm making is explicitly against socializing its services simply because it is big,
Instead I'm advocating that, in the interest of long-term (say 50-100 year) public good, we maintain the relatively unregulated environment that allowed Apple to succeed in the first place, and tolerate the relatively small inefficiency that environment produces.
> At what point exactly did it lose the rights it was entitled to then?
At some point between becoming a publicly-traded company and becoming the sole gatekeeper of a significant chunk of the world's personal data and apps.
To provide a precise specification of which exact antitrust regulations should take effect at which threshold of growth is, I hope you will concede, a tiny bit beyond the scope of a HN comment.
> If 3 dudes in a basement are entitled to sell goods/services on their own terms, then Apple should be as well.
I see no reason why that should be the case a priori.
"Apple" does not refer to the free actions of a few individuals, but to a particolar kind of profit-seeking contract called a "public company".The capabilities of such contracts can and do get restricted all the time, often with good reason.
> Apple is still a private company, not a public service, and the case I'm making is explicitly against socializing its services simply because it is big
Whereas the case I am making, conversely, can be summed up as: once a company becomes so big and/or powerful that it can prevent competition from arising outright, it should be either broken up or socialized, preferably the former.
Apple cannot prevent competition from arising outright, just as RIM could not, just as Microsoft could not. That's my whole point. Antitrust itself is a violation of fundamental liberty. There doesn't need to be an authority that tells free people how to interact peacefully. This authority diminishes the liberty of the people subjected to it, regardless of whether it came to power democratically or otherwise.
Do you really think that failing some public intervention Apple will be around in a century, undiminished? If it is, wouldn't that mean it is continuing to provide valuable goods and services people want?
"Apple" does indeed refer to the actions of a group of individuals, simply because there are no other agents in the system. It's individuals making decisions all the way down. "Publicly traded" doesn't mean "public service".
The tech giants have such warchests that they can afford to simply buy out any competitor that has a chance to compete with them. And unlike Cronus, they're unlikely to be deceived into swallowing an omphalos.
> Do you really think that failing some public intervention Apple will be around in a century, undiminished? If it is, wouldn't that mean it is continuing to provide valuable goods and services people want?
Is that belief of yours even falsifiable?
Is there any observation that would make you conclude that a given company, despite being profitable in a free market, is nevertheless representing a net negative for the world?
Or is it an article of faith for you that an unconstrained free market always leads to an eventually optimal equilibrium?
It is trying. Yahoo tried to acquire Google too, remember? Why take millions when you can make billions? Plenty of orgs refuse to be acquired because they see more money on the table by competing.
> Is that belief of yours even falsifiable?
Not per se, but history shows that even the most entrenched monopolies are very prone to disruption. I don't see any non-banks in the Fortune 100 that are over a century old. This almost proves my point since there is hardly any industry more entrenched by regulation than banking.
> representing a net negative for the world?
First we would have to agree on what "net negative" means, agree that our vision of what to do about it would improve the situation, and agree that we have a right to take such an intervention. Do you see where the problem is?
> unconstrained free market always leads to an eventually optimal equilibrium
Of course not, only that we the people do not have the right to dictate to other free people how they can peacefully, consensually, interact. Nor do we have the right to dictate to others the meanings of words like "negative" and "positive". All this does is diminish the freedom of everyone involved.
> It is trying. Yahoo tried to acquire Google too, remember?
The success rate doesn't need to be 100% for my point to be valid.
WhatsApp and Instagram could very well have eaten Facebook's lunch. Now FB is being threatened for the first time by TikTok, why? Because they're a Chinese company and FB can't simply buy them due to Chinese regulations!
Also consider this: in an idealised, perfect free market, every company is just barely breaking even, because as soon as they're making a profit it means it's possible to undercut them. (Bezos: "Your margin is my opportunity").
The existence of massive liquidity in the hands of some companies is itself evidence of inefficiency.
> Not per se, but history shows that even the most entrenched monopolies are very prone to disruption. I don't see any non-banks in the Fortune 100 that are over a century old.
Poor evidence, since antitrust action was very strong in the USA for most of the 20th century.
> First we would have to agree on what "net negative" means, agree that our vision of what to do about it would improve the situation, and agree that we have a right to take such an intervention. Do you see where the problem is?
Yes, people can disagree on what their preferred society looks like. That's the fundamental problem of politics. But that disagreement can include the exact value of freedom.
I personally rate freedom very high, yet the restraint "if you manage to build a trillion-dollar company, you must not make it unnecessarily hard for others to develop better products than yours" sounds like a slam-dunk kind of sacrifice for the sake of a more efficient innovation-oriented market.
> The success rate doesn't need to be 100% for my point to be valid.
Yes it does. You were arguing that Apple can prevent competition from ever arising. This isn't the case, clearly.
Yes of course there is inefficiency, I never said there wasn't. It would take a long time and a lot of money to build a mobile device as capable as an iPhone. That amount of time/money basically dictates how Apple can behave in the marketplace. If Apple triples its prices, for instance, competitors will become much more appealing both to users and investors.
All of this profit is Apple's return on the initial investment of developing the iPhone and App Store. This was an existentially risky thing for them to do, and we should not hinder the profits brought about by its success, lest we discourage others from attempting the same.
It's not at all clear that these regulations will create a more innovation-oriented market. It could well be that they will hinder innovation. Do you have any ideas on how we can tell for sure? I think we should be pretty confident before using regulation, don't you?
> Yes it does. You were arguing that Apple can prevent competition from ever arising. This isn't the case, clearly.
Ok, fine, it can only reduce the effectiveness of competition by a large amount. See the last point in this reply.
> All of this profit is Apple's return on the initial investment of developing the iPhone and App Store. This was an existentially risky thing for them to do, and we should not hinder the profits brought about by its success, lest we discourage others from attempting the same.
Why? Do we not want to discourage others from attempting to build rent-seeking platforms?
(a) "I want to design and sell a great device: a new kind of smartphone, with radically improved UX and capabilities"
(b) "I have a great device that everybody wants. Instead of directly raising its price, I want to make money by getting a 30% cut of all business ever done on this device, forever"
(a) is a perfectly fine business plan, and it doesn't hamper anyone else's competitive efforts. The follow-up (b) however _only_ works as a monopolistic plan. If the device isn't very successful, the rent-seeking will further drive away app developers. But if the device becomes incredibly popular, app developers will have to suck up the extortionate price because I've locked down the market.
Peter Thiel said "Competition is for suckers", and this is a good example of it. The benefits of the free market come from competition, but companies will naturally strive hard to avoid competition. Therefore, the rules should make it hard for them to do so, and easy for competition to arise.
> It's not at all clear that these regulations will create a more innovation-oriented market. It could well be that they will hinder innovation. Do you have any ideas on how we can tell for sure? I think we should be pretty confident before using regulation, don't you?
On the one side: hundreds and hundreds of promising startups whose products only ended up raising the existing giants' moat even higher, when not cancelled outright.
On the other side: gosh, what if someone in the future had the next iPhone-level innovation in hand, but the idea of having to turn it into a semi-open platforms after a paltry fifteen years of obscene profits turned them off the idea?
I'm not so much saying that the benefits will be massive, as much as I'm saying the 'deterrent' risk is hilariously negligible.
I don't think Apple needs to be socialized to solve this problem, in fact saying that obfuscates a simple and practical solution. It should be illegal for a company to actively prevent you from running code on a device that you own.
We need something like Right to Repair but for software, if I own a phone, I should be able to run whatever I want on it. You shouldn't be able to charge money for the privilege of installing my own software, just like an auto maker can't charge me for the privilege of repairing my own car. Companies will use all sorts of weasel words and scare tactics but at the end of the day it's simply anti-competitive.
This is nice idea, but it falls flat. In this case Apple's advantage, the actual reason consumers prefer Apple's devices, is because they restrict what code can be run on them, in order to provide a safe, trustworthy, optimized user experience. Why do you want to rob Apple (and the market) of this advantage?
> the case I'm making is explicitly against socializing its services simply because it is big
So what is that case? If we gradually socialize organisations that get too big (based on judgements that will ultimately be somewhat vague, sure), what's the actual downside? The 3 dudes in a basement will still have the promise of literally more money than they can consume in their lifetimes. Maybe the amount of VC money sloshing around the system would drop a bit from current levels, but that might be no bad thing.
> If 3 dudes in a basement are entitled to sell goods/services on their own terms, then Apple should be as well.
Where did you get this idea? Lets continue this line of thought:
If 3 dudes are entitled to piss in the ocean then Apple is entitled to route the human waste from their corporate HQ directly to the ocean without any treatment facilities
If 3 dudes are entitled to have racists discussions in the privacy of their home, then Apple should be fine to do the same in their HR policy in their HQ
If 3 dudes are entitled to hunt 1 deer, then Apple should be as well entitled to hunt 1 million deer.
If 3 dudes can build a shack without having to deal with fire inspections, then Apple should be able to build an office or a million shacks without fire inspections.
If 3 dudes are entitled to piss in the ocean, then yes all of Apple staff can march to the shoreline and do the same.
> If 3 dudes are entitled to have racists discussions in the privacy of their home, then Apple should be fine to do the same in their HR policy in their HQ
Yes actually, I think people should be able to discriminate based on whatever criteria they see fit. Why is discriminating based on height/attractiveness OK but race not OK?
> If 3 dudes are entitled to hunt 1 deer, then Apple should be as well entitled to hunt 1 million deer.
I'm not aware of any restriction on Apple employees applying for deer permits.
> If 3 dudes can build a shack without having to deal with fire inspections, then Apple should be able to build an office or a million shacks without fire inspections.
I think zoning restrictions apply to locations, not people.
> Yes actually, I think people should be able to discriminate based on whatever criteria they see fit.
Now that I am clear we are discussing your personal fantasy, not the real world or moral consensus, this thread makes more sence.
"I'm not aware of any restriction on Apple employees applying for deer permits."
Are you unable or unwilling to distinguish between employees individually hunting in their free time and Apple the corporation getting a permit to kill 1 million deer and handing their employees rifles?
You seem very keen on blurring the line between corporate and private life. Should we also extend this logix to sexual relationships and reproductive rights, see what kind of distopian nightmare we will arrive at?
This isn't my personal fantasy, this is liberty as it was set out in the declaration of independence, and the french revolution after it. This is how America lived until the late 19th century with antitrust and the reinterpretation of the general welfare clause.
Corporate life is private life, since it is not public life. Anyone can start a corporation - I can start one to manage a dining club, appointing a treasurer, secretary, etc. from among my friend group. Does this mean that I now have to be non-discriminatory in whom I admit to dinner? Isn't that a bit... tyrannical? There isn't any strong legal boundary between my dining club corporation and Apple.
If our government issues Apple a permit to kill 1m deer, then by golly do they have the right to do so.
Yes indeed we should allow people to participate in their private and sexual lives at-will and consensually. I'm making the point that one is no more entitled to a particular kind of app store from Apple than they are to a private relationship.
"how America lived until the late 19th century with antitrust"
Yeah, nothing screams 'this is liberty' like holocaust of Native Americans and burning alive anyone who disagrees with you for 'witchcraft'.
"If our government issues Apple a permit to kill 1m deer, then by golly do they have the right to do so."
Ah I see, so because reproduction is a human right, you have to apply for a breeding permit? Because 'freedom of speech', you need a 'talking permit'?
"Yes indeed we should allow people to participate in their private and sexual lives at-will and consensually."
So Apple should be able to put out an official job ad "HR assistant - skills: punctual, good with emails, excellent blowjobs, doesn't mind anal"
"Does this mean that I now have to be non-discriminatory in whom I admit to dinner? Isn't that a bit... tyrannical? There isn't any strong legal boundary between my dining club corporation and Apple."
I think the number of people who have finished school in the last 30 years and are confused whether "our restaraunt doesn't allow black people" constitutes discrimination is 0%.
> Yeah, nothing screams 'this is liberty' like holocaust of Native Americans and burning alive anyone who disagrees with you for 'witchcraft'.
Yeah, we denied lots of people their liberty; it doesn't mean the definition was wrong.
> Ah I see, so because reproduction is a human right, you have to apply for a breeding permit? Because 'freedom of speech', you need a 'talking permit'?
I'm not sure what this has to do with anything. Our government issues permits to hunt deer.
> So Apple should be able to put out an official job ad "HR assistant - skills: punctual, good with emails, excellent blowjobs, doesn't mind anal"
Actually yes? What business is it of yours? What's wrong with someone wanting a job like that and taking it?
> I think the number of people who have finished school in the last 30 years and are confused whether "our restaraunt [sic] doesn't allow black people" constitutes discrimination is 0%.
It clearly is unlawful discrimination, but my point is these laws are arbitrary and authoritarian. Why is it OK to discriminate via height, figure, or beauty, but not race? All of these are rather immutable characteristics. The whole idea of some authority dictating which criteria I use to admit people to my shop/restaurant is tyrannical, just like it would be tyrannical to outlaw racial discrimination in dating. Let people choose for themselves whom they associate with in all aspects of their lives.
Yes I agree - but the whole idea of "liberty" and the US declaration as originally intended does. Indeed most of the world is content with a high degree of authority/tyranny. That doesn't invalidate the concerns of those who wish to be free.
Neither the Declaration of Independence nor the Constitution provide any provision for the existence of corporations, which are entities that reduce individuals' liabilities for their actions while running a business.
In exchange for the privilege of limiting your liability for your actions, you agree to follow a set of rules when forming and running a corporation. When acting on the behalf of a corporation, you are never engaging in "liberty" because any and everything a corporation can do is a privilege granted by the government.
Since we are taking jabs at countries for 'liberty', most of the world is not running a spying machine that would make Soviet Union green with envy.
Back to the practical problems, conflating personal liberty and rights of giant corporations to spy on your and sell your private information is rather unhelpfull. I don't think anyone is buying it.
Capitalism is beneficial as long as profits aligns with increasing productivity. However capitalism is harmful when profit incentives encourages creating bottlenecks. The appstore is currently a bottleneck and Apple has no incentives to fix it, removing their profit incentive from keeping that bottleneck around is good for everyone. If it really benefits the user to have everything running in the Appstore then it would still keep it there even if it had a 5% fee, just that Apple would no longer try to make everything go via the app store even when it doesn't make sense for it to.
Yes and the way it's supposed to go is that a competitor creates their own devices that entice users away from Apple, just like Apple did with RIM. Why 5%? why not 4? Why not 6? Who are we to decide what Apple charges for Apple services? How do you know what it costs Apple to maintain the review process and to continue to innovate in mobile space? Why is it any of our collective concern what apple over/under charges for?
What do you mean doesn't work? Didn't it produce Apple to begin with? Where was the regulation on RIM in the late aughts?
> just like they did for VISA and Mastercard when they capped card transaction feed.
And in so doing they significantly increased the barrier to entry in the space, effectively cementing VISA and Mastercard into market dominance. This happens everywhere everything is regulated - incumbents shape the regulation so it's easy for them to comply with and difficult for new entrants, creating all sorts of disfunction.
Let me ask, what is the cost of doing nothing here exactly? Why are you so certain that that cost is higher than the cost of intervention?
> And in so doing they significantly increased the barrier to entry in the space, effectively cementing VISA and Mastercard into market dominance
This isn't true, there are tons of alternatives to Visa and Mastercard in Europe today. Rather significantly reducing the profits and thus the warchest of these companies made it easier for small companies to compete, not harder. The same applies to appstores.
> Let me ask, what is the cost of doing nothing here exactly?
The cost is reduced innovation. Same with card fees. The future is electronic payments, they are much more efficient, anything that hampers that is hampering innovation. That includes card fees, or this tax on Appstore purchases. Many apps simply aren't feasible to make with such high fees, marketplace apps etc where you trade things with people for example.
Not to mention that the Appstore tax encourages advertisements over purchasing apps, since you lose 30% of any purchases but you don't pay anything on ads, making the advertisements effectively 40% more profitable in comparison. You'd have a more sane monetization ecosystem for apps if the appstore tax got reduced.
There are multiple "simple magic flags" you can wave - e.g. monetize using ads or make a "reader" app where users have to subscribe elsewhere. Apple doesn't make you pay them 30% that way. I hope governments force them to not take 30% elsewhere too, because neither devs nor users can do it.
> There isn't a magic flag you can wave to avoid paying Apple for the use of their platform.
If alternate App Stores and direct inatallation of IPA files off the browser was allowed, developers could have the ability to not even use any of Apple's plattform. Hell, I bet that a community-made FOSS SDK to create iOS apps would arrive. Then those devs wouldn't use or distribute any of Apple's IP while developing their apps (besides the Apple devices they already own and use for developement)
Apple does allow installation of IPA from the browser. There are a few different ways you can do it, from generating a special URL to App Clips. https://developer.apple.com/app-clips/
That's not the issue. The issue isn't the method of distribution. The issue is being able to get around Apple's sandboxing.
> you must submit a new app that uses the new entitlements.
That's easy to do. Simply change the SKU and Bundle ID, and set up a new app in iTunes App Store. Deprecate the old one. Lots of apps do this, anyway. It's sort of S.O.P. for new paid versions.
I've released a whole bunch of apps, over the years. I've retired most of them, and come out with entirely new versions of others.
It's a pain, but nothing too intimidating. I find the article to be a bit ... hyperbolic ... The process I just described would take me a day, and that's mostly because I'm fairly anal about hand-crafting a lot of stuff that many developers can integrate into their CD process.
I‘m sure the fee will be slapped down later too. It gives Apple unfair competetive advantages in the industries it operates in. (e.g Apple Music vs Spotify)
"Reader" apps, broadly construed, can already offer outside subscriptions. Apparently, Spotify does not pay a 30% fee to Apple, but only 15%, and that on less than 1% of its paid members, so only around 0.15%. That does not seem to constitute unfair competitive advantage.
Well I‘ve read that math many times and I don‘t understand the intention here.
Of course the number is very low - Spotify did not allow subscriptions through apps for a long time (do they now?)
Even if they have to pay 15% now (I don‘t know) that‘s still 15% of their margin (!). Apple is able to make much better offers because they don‘t have to pay that fee.
The 0.15% is math meant to distract, just ask Spotify.
While 27% is higher than expected, everyone knew Apple would (and had the right to) impose a fee for alternative payment methods. There isn't a magic flag you can wave to avoid paying Apple if you are accepting payments in an iOS app.
> app developers have to produce an entirely new app
This is the part the Dutch court slapped down. The development concerns in the press release are overblown, though ("must develop a completely new app") since it's more like you must submit a new app that uses the new entitlements.