“Absent a ‘smoking gun,’ neither the Federal Trade Commission nor the Department of Justice is likely to take Apple to court for antitrust violations, according to a note to clients issued Friday by Stifel Nicolas’s Rebecca Arbogast and George Askew,” Phillip Elmer-DeWitt reports for Fortune.
“Apple has credible justifications, they write, for both complaints that have been lodged against it: its decision to exclude Adobe Flash from its mobile devices and, just this week, the change in its developers agreement that effectively restricts Google’s AdMob from advertising on Apple’s new ad platform,” P.E.D. reports.
But Arbogast and Askew argue that even if they go nowhere, government inquiries like these are a “negative” for Apple for three reasons:
1. Every time a company comes before DOJ or the FTC, staff get to ‘peek under the hood’ and acquire information that they can later connect with additional information to develop a theory of harm.
2. Apple will likely engage in additional [merger and acquisition] activity, which will require DOJ or FTC approval. This provides an opportunity for the government to shape conditions to address behavior that they might find problematic but that falls short of the basis for an antitrust suit.
3. The existence of an inquiry or investigation can lead to a company modifying (or “clarifying”) their practices to deflect the government (and any negative press).”
Read more in the full article here.