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Apple May Face Antitrust Inquiry 457

Posted by Soulskill
from the upsetting-the-apple-cart dept.
suraj.sun writes with this excerpt from the NY Post: "According to a person familiar with the matter, the Department of Justice and Federal Trade Commission are locked in negotiations over which of the watchdogs will begin an antitrust inquiry into Apple's new policy of requiring software developers who devise applications for devices such as the iPhone and iPad to use only Apple's programming tools. Regulators, this person said, are days away from making a decision about which agency will launch the inquiry. It will focus on whether the policy, which took effect last month, kills competition by forcing programmers to choose between developing apps that can run only on Apple gizmos or come up with apps that are platform-neutral, and can be used on a variety of operating systems, such as those from rivals Google, Microsoft, and Research In Motion. An inquiry doesn't necessarily mean action will be taken against Apple, which argues the rule is in place to ensure the quality of the apps it sells to customers. Typically, regulators initiate inquiries to determine whether a full-fledged investigation ought to be launched. If the inquiry escalates to an investigation, the agency handling the matter would issue Apple a subpoena seeking information about the policy."
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Apple May Face Antitrust Inquiry

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  • Re:[sigh] (Score:5, Informative)

    by Trepidity (597) <delirium-slashdotNO@SPAMhackish.org> on Monday May 03, 2010 @04:36PM (#32076708)

    Most (not all) antitrust legislation is aimed at preventing monopoly exploitation of alternate markets.

    This falls into the "not all" category though, I think, since it's an investigation of whether Apple's engaged in anticompetitive tying. The iPhone / Apple devtools tying is somewhat reminiscent of the car-makers / car-parts antitrust investigations, which happened even though no carmaker actually held a monopoly in the car market.

    I think it'd be a problem for Apple if it were possible to show (e.g. by discovering an unwise internal memo) that the main purpose of the restrictions is to restrain trade, e.g. to harm the market for competitor development tools, or to make it harder to port apps to/from Android. Apple would want to be able to show that the tying was done for legitimate reasons not related to restraining trade.

  • Re:[sigh] (Score:5, Informative)

    by dzfoo (772245) on Monday May 03, 2010 @04:42PM (#32076780)

    Apple does not require developers to use Apple tools, only the approved languages, which were not invented and neither are owned by Apple: Objective C, C, and C++. XCode is the IDE provided by Apple, and it uses GCC to compile the code.

    You are free to use whatever you want, as long as the code is originally written in one of those languages and not ported from a different platform.

            -dZ.

  • Depends on the kind of antitrust suit. Certainly you can't be guilty of monopoly leveraging unless you have a monopoly, so you're right as far as that goes. =] And it's also true that that's generally the easiest kind of antitrust claim to prove (it's what Microsoft was accused of), because there's a very strong presumption that if: 1. you're a monopoly; and 2. you're leveraging it; then that's bad, regardless of what "legitimate reasons" you have for doing so. (It used to even be considered always illegal to leverage a monopoly, but recent Supreme Court decisions have chipped away at that.)

    There are other kinds of anticompetitive trade practices, though, with lower threshholds. At the one end of the scale is being a monopoly, where your conduct is closely scrutinized; at the other end is being a tiny player, whose market power is so small that any claim you were engaged in anticompetitive behavior is implausible. But in between there's a whole area of restraint-of-trade and anticompetitive tying, where you can be guilty of an antitrust violation without being a monopoly, if you have sufficient market power to influence another market improperly, and you did in fact do so. For example, some car manufacturers lost antitrust cases relating to car parts, despite not having a monopoly on automobiles: courts found that e.g. Mercedes banning anyone from making Mercedes-compatible parts was anticompetitive tying between the car market and the replacement-parts market, even though Mercedes isn't a car monopoly.

    Those kinds of cases often come down to what the intent of the tying was. Mercedes argued that they wanted to control the replacement-parts market not for anticompetitive reasons, but for quality-assurance reasons; the courts ended up not buying that. But often courts do buy arguments that there was a legitimate reason for tying (possibly even most of the time; non-monopoly tying prosecutions succeeding isn't that common). In Apple's case, they would presumably argue that the purpose of requiring XCode and certain languages isn't mainly to restrain trade in dev-tools markets or to make it harder to port apps, but because of reasons related to its app-review process ("it's easier to review apps if they're all in Obj-C on XCode" or something). I could see a court giving reasonable deference to that, though predictions are always dodgy. The main place I could see that failing is if there's some smoking-gun email that ends up as evidence, where a VP or someone says, "hey we should institute this new requirement because of [reasons that sound like restraint of trade]".

  • by GrumpySteen (1250194) on Monday May 03, 2010 @04:52PM (#32076938)

    Inquiry != prosecution.

    The point of an inquiry is to determine whether there is a basis for an anti-trust case or not.

    There isn't some pre-inquiry inquiry to decide if the company has enough market share or has behaved in ways that violate anti-trust laws, so there's no point in crying about how Apple doesn't meet the criteria for an anti-trust case.

  • Re:[sigh] (Score:2, Informative)

    by FlyingBishop (1293238) on Monday May 03, 2010 @04:53PM (#32076954)

    False.
    From the infamous section 3.3.1:

    Applications that link to Documented APIs through an intermediary translation or compatibility layer or tool are prohibited.

    You cannot code in Objective C, C, or C++ unless you are using Apple's proprietary APIs.

  • Re:[sigh] (Score:3, Informative)

    by Altus (1034) on Monday May 03, 2010 @05:01PM (#32077064) Homepage

    I don't believe there are any restrictions on porting an application, you just cant use something to compile and app from one language (say, flash) to Obj-C and then submit it.

  • by Anonymous Coward on Monday May 03, 2010 @05:13PM (#32077222)

    Your analogy is suggesting operating systems - Apple does not sign apps to run on OS X.

    A more accurate description would be "imagine MS controlling what apps and what developer environment was used for mobile Windows"... oh wait, they do.

    No, they don't! Microsoft is doing nothing like what Apple is doing here. If your multiplatform app dev tool spits out versions of your app compiled for Windows Mobile, Android and iPhone - only Apple will ban it.

  • by DrScotsman (857078) on Monday May 03, 2010 @05:15PM (#32077244)

    Not that anyone will read this before posting, but

    Inquiry != prosecution.

    Not that you read the summary before posting...

    An inquiry doesn't necessarily mean action will be taken against Apple

  • Re:[sigh] (Score:2, Informative)

    by ThrowAwaySociety (1351793) on Monday May 03, 2010 @05:28PM (#32077474)

    False.
    From the infamous section 3.3.1:

    Applications that link to Documented APIs through an intermediary translation or compatibility layer or tool are prohibited.

    You cannot code in Objective C, C, or C++ unless you are using Apple's proprietary APIs.

    The quote disproves your assertion. It does not say that you must use Apple's APIs; rather it says that you cannot use another API that uses Apple's APIs.

  • Re:[sigh] (Score:4, Informative)

    by ceoyoyo (59147) on Monday May 03, 2010 @05:33PM (#32077552)

    Can you point out where it says that? The agreement actually has a specific item in it that specifies if you use any FOSS you agree to satisfy the requirements of the particular FOSS license.

    There was a time when the SDK was under NDA and so you weren't allowed to discuss it in public, but that time is past, except for the bleeding edge beta releases. There are lots of publicly viewable discussion groups, including one hosted by Apple, and many, many tutorials (that would be publishing code).

  • Re:[sigh] (Score:4, Informative)

    by Wovel (964431) on Monday May 03, 2010 @05:35PM (#32077590) Homepage

    Apples only restriction on book pricing is that the price must end in 99 cents. They also have a restriction that you can not sell your book in another online store for less than you charge in Apple's store, but Amazon has the exact same restriction.

    All other pricing decisions are made by PUBLISHERS. Amazon forced publishers to sell books at prices lower than they wanted to. Apple has simply said that publishers should decide their pricing.

    This case has nothing to do with web standards, but beneath all your struggling you seem to have a point.

    100 million iDevices to give them a certain market power and it is possible for regulators to use that as a basis for an anti-trust investigation.

  • by Wovel (964431) on Monday May 03, 2010 @05:46PM (#32077766) Homepage

    Everyone realizes that this announcements indicated that two government agencies are in the midst of negotiating to decide which one of them might launch an investigation.

    Most of us will likely have died of old age before the investigation even starts. Why do real work when you can justify your existence by simply sitting around the office and bickering with the guys down the street.

    It took 10 years to resolve the Microsoft case and their market dominance was clear and certain. 3 Years to come to agreement. Another 4 years for the DOJ to sure Microsoft for completely ignoring the agreement. Three more years to resolve the lawsuit.

    Since it is unlikely these two departments will resolve their internal squabble any time soon. By the time they do one of them will be out for blood. Unfortunately there will be little to find.

  • Re:[sigh] (Score:3, Informative)

    by TheRaven64 (641858) on Monday May 03, 2010 @06:43PM (#32078596) Journal

    Apple does not require developers to use Apple tools, only the approved languages, which were not invented and neither are owned by Apple

    A minor quibble, but Apple actually does own the Objective-C trademark (NeXT bought it from Stepstone and Apple inherited it), so Apple gets to define the Objective-C language.

  • Re:[sigh] (Score:3, Informative)

    by tyrione (134248) on Monday May 03, 2010 @07:53PM (#32079562) Homepage

    I hadn't thought of this, and this is exactly right. I don't even think they need to find an email: this seems (perhaps illegally) anti-competitive on its face.

    You're clearly never been a developer for an OEM or an OS corporation. They have legal contracts disclosing directions long in advance of their marketing campaigns.

  • Re:[sigh] (Score:3, Informative)

    by tyrione (134248) on Monday May 03, 2010 @07:57PM (#32079612) Homepage

    That is if I want to easily port my app to different platforms I will have to abstract the platform dependant portions so that I can re-use the rest of the code directly, and have separate bits of code for the various APIs and such.

    They just disallowed doing exactly this, and required that you only use their API directly, without your custom wrapper library.

    Factually incorrect. Your low level code that are doing your platform independent routines must be written in C, C++, ObjC or ObjC++ and even Javascript. The hooks to the OS must use the iPhone OS APIs. That's it.

    This of course has nothing to do with Mac OS X proper.

  • Re:Its about time! (Score:3, Informative)

    by mr_matticus (928346) on Monday May 03, 2010 @10:31PM (#32080812)

    They should also look into why Apple refuses to allow people to isntall OSX on their "non Apple PCs"

    They already did. It was decided in court. Did you miss the whole Psystar battle? All the armchair lawyers predicted vindication of their half-assed theories and claims...while everyone else waited with a bemused expression for the inevitable: Apple's sales model and license being upheld in court.

    Both an antitrust inquiry and a lawsuit end up in the same place if they're not dismissed: federal court. But as has been said (and largely ignored) an inquiry doesn't mean that there has been an antitrust/competition law violation or even that one is suspected. It means that someone has complained and made allegations that could, if true, potentially be found to be anticompetitive.

    Right now, it hasn't even been decided to open a formal inquiry. If an inquiry does happen, it doesn't mean it will be prosecuted in court. If it is prosecuted in court, it doesn't mean a violation occurred. We're about nine steps away from anyone actually demonstrating improper behavior.

  • Re:Its about time! (Score:1, Informative)

    by Anonymous Coward on Tuesday May 04, 2010 @02:13AM (#32082082)

    It's not the same hardware. Apple doesn't want to have to support AMD processors, non-intel motherboards, generic winmodems, etc. It's not just a matter of letting it run unsupported, but people will call OS X crummy if it crashes their Asus, and they don't want their brand damaged by it.

If A = B and B = C, then A = C, except where void or prohibited by law. -- Roy Santoro

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