The Apple v. Epic Decision
13th September 2021
Ben Thompson at Stratechery.
An excellent analysis of the recent anti-trust action decision. Thompson isn’t a lawyer, as far as I know, but he would make a good one. Of special note:
This gets at a larger problem in many tech markets: the tendency towards duopoly, which often lets one company cover for the other acting anti-competitively. In the case of Apple and Google:
- Android’s presence in the market means that Apple can act anticompetitively with its App Store policies (which Google is happy to ape).
- Apple’s privacy focus justifies decisions like limiting trackers, restricting cookies, and cutting off in-app analytics; Google happily follows Apple’s lead, which impacts its advertising rivals far more than it does Google, improving their relative competitive position.
- Apple earns billions of dollars giving its customers the best default search experience, even as that ensures that Google will remain the best search engine (and raises questions about the sincerity of Apple’s privacy rhetoric).
This isn’t the only duopoly: Google and Facebook jointly dominate digital advertising, Microsoft and Google jointly dominate productivity applications, Microsoft and Amazon jointly dominate the public cloud, and Amazon and Google jointly dominate shopping searches. And, while all of these companies compete, those competitive forces have set nearly all of these duopolies into fairly stable positions that justify cooperation of the sort documented between Apple and Google, even as any one company alone is able to use its rival as justification for avoiding antitrust scrutiny.
Apple’s requirement that iOS apps pay Apple the full 30% commission for ‘in-app purchases’ is the reason nobody uses the Amazon app on the iPhone, which will not let you make purchases through the app, but merely lets you add products to a ‘shopping list’, presumably from which you can make the actual purchase from Amazon through a browser, where the in-app purchase commission doesn’t apply. This is a serious inconvenience for the user, but Jeff Bezos didn’t get to be the world’s richest man by forking over 30% of the purchase price to Tim Cook.