The Apple iPhone monopoly myth

“After initially dismissing the notion that Apple could ever break its way past entrenched rivals and make any significant impact on the smartphone industry, tech pundits are now aghast that Apple is running its business the way its executives see fit. Critics charge that the iPhone and its mobile software store amount to a monopoly and a restriction of free trade. They’re wrong,” Daniel Eran Dilger writes for RoughlyDrafted.

Dilger asks, “How is it that those who were skeptical that the iPhone would take off, or even hopeful that it wouldn’t, are now taking the position that Apple shouldn’t be allowed to chart its own destiny, but should instead be run by the community of pundit opinion that tried to destroy it?”

“The reality is that Apple has earned its success, not by being granted a monopoly by fate that it turned around as a weapon to stop competition, but by actually competing to deliver a better product,” Dilger writes.

“Daniel Lyons, the Fake Steve Jobs who went to Newsweek to write up absurdities about how Apple is like Microsoft because Vudo is going out of business because Apple sells movies in iTunes, is a great example of why the tech media needs to educate itself on the difference between successful competition in a functional market, and Microsoft’s abuse of its monopoly position to prevent competition,” Dilger writes.

“Apple doesn’t have a moral obligation to grant other companies success,” Dilger writes. “[Apple] has already provided them an example of how to attack monopolists and win. If they can’t compete, that’s their problem.”

Full article – recommended – here.

57 Comments

  1. Daniel Eran Dilger is a disingenuous, self-important, blowhard, who writes articles for other web sites, then links to them in his Roughly Drafted pieces to support his statements. I’ve got no use for him.

    Plus, the guy can churn out 5,000 words on the most paltry topic without stopping for breath. Edit, Daniel, edit!

  2. @ Toodles

    He’s still right, on this one.

    So many analists wanted to see Apple fail.
    When Apple didn’t and the iPhone just took off, then the analists are bitter because Apple bucked the big guys and is winning.

  3. There’s a world of difference between leveraging a monopoly to force consumers to buy your product, and with just making a really cool product that people WANT to buy.

    Seriously. I don’t get what’s so hard to understand about that.

  4. @Toodles,
    Hmmmm,………

    “Toodles” is a disingenuous, self-important, blowhard, who writes comments for other web sites, then does nothing to support his statements. I’ve got no use for him.

    Plus, the guy can churn out 50 words on the most paltry topic without stopping for breath. Details, Toodles, Details!”

    Sorry, but I have actually met Mr. Dilger and found him to be an informed, intelligent, and aware person who has no agenda except for truthful articles.

    Just a thought, ” width=”19″ height=”19″ alt=”grin” style=”border:0;” />
    en

  5. Definition

    analyst |ˈanl-ist|

    noun
    1- Someone who can’t get a job so they make up a company name and website to post their innermost thoughts.
    2- Someone who failed out of college, then see above.

  6. @ Toodles.

    I disagree entirely. I find Daniel to be on top of the game and very insightful. But that’s the great thing about the net, so many opinions and we all get to debate it right here.

    I respect your opinion I just do not agree.

    Take care.

  7. The answer for all the fud is simple. Huge butt buddy companies that are shaking in their boots now that Apple is in the picture. These guys are petrified because Apple is reaming them with the ms commercial churros. It is about time.

  8. @ericdano:

    I’m there, too. I still read Daniel’s Apple articles which I find insightful, and not the least bit disingenuous. But his political views–to which he is completely entitled–especially as they are expressed without the same level of critical insight, have soured me a bit on his site. And I am a donor to his site!

  9. People forget what Microsoft was like when they were behaving like a monopoly (they’ve since been forced to give up most of their old tactics).

    The worst in my book were their liscensing abuses. At one point for a box builder to liscense Word they had to liscense Office, to liscense Office they had to liscence Windows, and to liscense Windows they had to liscense MS-DOS. There was no option for building on top of DR-DOS or PC-DOS. To make matters worse you had to pay the liscensing fee, even on machines shipped with no operating system at all. So even if IBM had bundled their own PC-DOS with the system, they had to pay the liscence fee.

    Apple is not like this.

  10. A couple of points, here. Let’s start with Apple IS pretty much a monopoly. You want to run their OS? You buy their hardware. You want to rent tunes for your MP3 player? Can’t use their hardware. And blah, blah, BLAH!
    Which would really matter, if there were not other choices you could make. Up until recently, if you wanted to run their software you had to buy their hardware. Then came iTunes for Windows. A brilliant stroke! Defuses the monopoly charge. Broadens the effective market for their MP3 players. Gets Windows users who have had next to NO exposure to Apple hardware or software to take a look at the software, then the hardware, and notice “this is DIFFERENT”. Would that Safari were nearly so successful!
    Anyway. The iPhone is a different story. The one similarity is that if you want to run one of the gimmicks from the iPhone store, you have to have an iPhone. But, if you want to run one of the gimmicks from the Microsoft store, don’t you have to have a phone with Windows Mobile on it? And, don’t more people currently own WM phones than iPhones? OK, maybe not by next MWSF, but … right NOW?
    I do believe Apple needs to offer much more of its software for both Windows and Linux platforms. Like iWork and iLife, for example. And maybe even a bunch of the minor products we get with the OS, like Mail, iChat, Address Book and the like. Maybe bundled, but without the OS. iWork cannot compete with MS Office in most “typical” Enterprise situations, but for SOHO and consumer use? And iLife has all sorts of applications (as well as ‘apps’) Windows users would find lovely and Linux users would find unexpectedly easy to use. The others – let’s call the bundle “iManage” – would actually work well in the Enterprise! Especially iChat (with iChat Server) which would make conference calls a joy!
    Yes, we are a monopoly. And growing. But, only within our niche.

  11. cogitoergomac “I’m there, too. I still read Daniel’s Apple articles which I find insightful, and not the least bit disingenuous. But his political views–to which he is completely entitled–especially as they are expressed without the same level of critical insight, have soured me a bit on his site. And I am a donor to his site!”

    Exactly the problem. He shows tremendous knowledge on Tech things, but the first article he wrote about Politics had a lot of “facts” that seemed to come right off of the Huffington Post or DailyKos or Digg.

  12. As said before and unlike M$, it’s ok to have a monopoly when you have the best products and are years ahead in design and compatibility between hardware and software.
    M$ never had the best product and the playing field is leveling more each day.

  13. It has been reported here at MDN that the number of iPhones sold (and activated) was to surpass the total number of WinMobile licenses sold sometime during September this year. in other words, at the moment of this writing, there should be more iPhones (two models with two versions each) than all those WinMobile devices (dozens of makers, hundreds of different devices).

    To quote a character from a 90’s motion picture “Good Will Hunting”, …”How ’bout them apples?”.

  14. @DLMeyer

    I hate to break it to you, but your argument is extremely flawed. Creating software tied to your own hardware does not constitute a monopoly. You have to differentiate between a product type and a specific brand. As long as you have products out there competing with yours, you don’t have a monopoly. Since Windows Mobile & Blackberry exist as other “smart phones,” then consumers have choice and there’s no monopoly.

    Do you need an iPhone to run iPhone apps? Of course. The same way you need an Xbox360 to run Xbox360 games. Since customers can go buy a PS3 or a Wii instead, there’s no monopoly. You have the choice to buy whichever product you feel suits your wants and needs. Apple has no legal obligation to open their OS or their mobile phone or their music business model to anyone as long as there is competition.

  15. @DLMeyer… cogent argument, but for Apple to be a monopoly wouldn’t they have to have a product or service that you couldn’t get anywhere else?

    The iPhone gets all the media attention, and is doing exceptionally well, but you can get countless other phones from not just other vendors but AT&T;as well. There is nothing that the iPhone does that I absolutely need. I just like it.

    In fact, no matter how well it’s doing right now, it’s numbers are dwarfed by the combined numbers of other mobile phones. I just don’t see how anyone can consider this a monopoly.

    Same for the iPod.
    People here spit on the Zune, but if Microsoft ever got smart and made the Zune compatible with the Mac and iTunes, the iPod would take a hit. Not just the Zune but there are any number of other MP3 players out there. Folks just like the iPods.

    I think everyone has to be careful that “monopoly” doesn’t become a synonym for “success.”

  16. Do you want replacement parts for your Ford, GM, Chrysler, Toyota, Honda, Mitsu, BMW, Mercedes, or VW?? Then BUY PARTS FOR THOSE MAKES…

    Do you want software for your PS3, Nintendo, X-Box??? Then BUY SOFTWARE THAT RUN ON THOSE SYSTEMS…

    Do you want to watch movies on NTSC or PAL video systems?? Then BUY SOFTWARE THAT OPERATES ON THOSE SYSTEMS…

    But please, please, please, please, please STOP SAYING THAT APPLE IS A ‘CLOSED SYSTEM’…. No one is putting a gun to your head and making you use Apple products.

    Daniel’s article is spot on in this matter… I stopped reading his website because of his leftist political views but when it comes to Apple matters, I usually find him very interesting & informative.

    If you don’t like Apple’s ‘closed system’ then go use something else, but stop whining about it. Douche-wad.

  17. @Jimithy

    correct.

    @theloniousMac

    also correct.

    PLUS. the one thing people also forget. IT IS NOT ILLEGAL TO BE A MONOPOLY. there are plenty out there. IT IS ILLEGAL TO ABUSE IT.

    so arguing that apple is a monopoly (which it isn’t) isn’t enough.

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