Competition closed?
February 23, 2010 3 Comments
Apple has upset the developers (and users) of thousands of adult-themed apps, which it has pulled from its iPhone app store in the past few days.
One developer accused Apple of “experimenting with our livelihoods” and said the iPhone ecosystem was being “run by puritans”. However, Apple argued that it had received thousands of complaints from customers, in particular women and parents, objecting to material such as “Wobble” – an app which displayed pictures of women’s breasts.
This story demonstrates the effects of one of the growing trends in computing over the past couple of years: the adoption of closed platforms for mobile computing. Apple has led the way in this, but other platforms – such as Moblin, Android and Nokia’s Ovi store – are now encouraging (or even requiring) users to obtain their software from official app stores.
The point is not whether those who control these platforms are puritans or libertarians: rather, it is that (unlike “traditional” open computing systems) the applications which users can install and run on their devices are under that control in the first place. This is a significant change in computing practice, and the rows such as that over adult iPhone apps may be what propels this from being a “geek” issue to one of wider concern. (What happens when China, say, requires Apple to block politically-unacceptable apps?)
I wonder also how long it will be before someone brings a challenge against Apple and other gatekeepers under competition law. In the context of UK and EU competition law, there would seem a good case for saying that Apple has a “dominant market position” in the iPhone apps market – after all, setting aside “jailbroken” iPhones, its app store has a 100% market share for iPhone apps.
Developers finding themselves locked out of the iPhone app store may well consider Apple to be abusing that dominant position, in breach of competition law – especially given the rather different treatment of apps for “established” adult entertainment brands, such as Playboy, whose own app apparently remains available.
It would be interesting if the European Commission ended up forcing Apple (and others) to open up their platforms – though perhaps the market will take care of it in the meantime, as platform owners decide the risks of relaxing their grip on their devices are outweighed by the consequences of having to get involved in controversies such as that over Wobble and its fellow apps.
John Halton is a technology lawyer in the south-east of England, specialising in intellectual property, technology law and related commercial contracts. He is a partner in the law firm Cripps Harries Hall LLP, based in Tunbridge Wells, Kent.
Read a book recently called, The Future of the Internet (and how to stop it). It went through the history of open vs closed platform starting with the Bell telephone monopolies and ending with the recent pushing of TiVo out of the market. Really good read, and echoes what you’re saying in the post above. There seems to be so much momentum towards appliances rather than platforms I’m not sure we can pull up before we hit the crystalization point. At some point the infrastructure for independence will wither away. How would of thought, back in the 90′s, that the internet would be the instrument used to kill open platforms?
I think one of our best hopes is human greed. It really looks like Apple has stepped on some major toes here. After all, porn, from an economic perspective, is one of the largest market sectors leveraging the internet for content delivery. There is the potential for a backlash that might break Apple’s stranglehold on the market share for mobile applications. If the porn shops migratet to another platform, that would encourage legitamate developers to do the same to fill in other niches of the same audience.
In the USA, we have the DMCA, which criminalizes using a computing device for anything the manufacturer prohibits. “Jailbreaking” is a crime, and the reason it’s a crime is so that manufacturers can control the content–i.e. it’s a feature, not a bug.
If there’s a high demand for porn-equipped smartphones, Apple won’t stay dominant for long. In fact, note that it took adult apps off its store in response to consumer demand.
Josh:
note that it took adult apps off its store in response to consumer demand.
Indeed. So there are two strongly contradictory sets of consumer demand: the demands of those who want to “keep it clean”, and the demands of those who… don’t.
There is, of course, a highly efficient and effective means of providing for both those sets of demands to be satisfied: the market. (Yes, you did just hear me say that. I’ve no problem with the market – in its place.)
The problem with closed platforms is that they interfere in the market for apps on each device. Now yes, people can then choose a different platform if they’re that bothered about it – which is one reason mobile app stores haven’t yet appeared on the competition authorities’ radar – but if you look at the wording of UK/EU competition law then there is a good argument for saying that each platform’s app market is a separate market in its own right.
From a competition law POV, saying “Well, buy a different phone, then” is like responding to monopolistic behaviour by motor manufacturers in relation to spare parts by saying, “Well, buy a new car from a manufacturer who allows an aftermarket”.