“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.
Do the Google trolls here get paid?
@cogitoergomac,
Not a lot of room to get too wordy here, especially on the iPhone app.
AdMob and Quattro constitute a significant portion of the mobile ad services market. Collecting marketing info provides a huge advantage to selling these services. Apple, while not having an outright majority of the smartphone market, has a significant chunk (ref, Steve Jobs’ WWDC10 speech). Even larger when considering the share of online usage, which happens to be more relevant.
Apple is using it’s position in mobile devices to limit full participation in a significant portion of the mobile ad space. I realize that AdMob can still offer ads for iPhone apps, but not being able to offer advertisers important data like iAd and other non-affiliated advertisers in reality means that their participation is severely diminished.
This of course would be even worse if they only provided the data to iAd. All of this assumes that iDevices are found to be a significant portion of the mobile market (as many Apple fans proudly proclaim).
So the restraint of trade comes in where developers have fewer choices for ad services due to Apple’s policy and ad service companies cannot equally compete in a significant market.
@Madmac: should Blockbuster or Netflix be forced to let the other advertise on their DVD rentals, AND collect the data on who did the renting? Netflix has a huge footprint in the streaming business. Can Blockbuster force them to disgorge their end user data just so Blockbuster can more effectively compete against them? Should they both be able to force Comcast to allow them to feature themselves inside the Comcast PPV system, just so they can compete against Comcast for PPV? Or even more apt, should they be able to get COmcast’s user data from Comcast’s PPV system so that their offering is more competitive? Should the TV networks that display their little bug onscreen be forced to display their competitor channels’ bugs, or their competitors’ upcoming shows? No advertisers [with $] are prevented access to the iAd space, no developers are prevented from using it; the only barrier is to AdMob’s ability to use Apple’s ecosystem to siphon out competitive data. This is not a whole lot different than being limited to one carrier on your mobile phone agreement [though you can swap SIMS, there are limitations], only being able to order off one menu at the Wendy’s drive-through [should Burger King be able to compel Wendy’s to use BK’s menu so that BK has a “fair” chance to compete?], only being able to buy Nissan cars at the Nissan dealership, or Nissan not sharing your purchase data with Toyota. State Farm uses my relationship to market stuff to me all the time. They sit on 40 million insureds, more than anyone. Should they be forced to let their competitors have access to their channel and their data? I sure don’t think so. Should Google be forced to give Bing its analytics? Certainly, in the traditional sense of restraint of trade, this is a tough case. Sorry, I don’t see this–even assuming there really is a “this”–going anywhere.
@cogitoergomac,
There are problems with all of your analogies (as often are with analogies). The main difference here is that Apple has a mobile device business that is being used to manipulate the mobile ad space. Wendy’s and BK have no ties like that. Same with Netflix and BB.
Google cannot be forced to give analytics to Bing because there is no tie like there is with the mobile device providers and the mobile ad providers.
The main rub for Apple comes in where they have significant presence in the mobile device market and they are using that (intended or not) to limit the effective market for mobile advertising.
You said, ” No advertisers [with $] are prevented access to the iAd space, no developers are prevented from using it”. I’m not sure I understand your point. No one is suggesting that advertisers could not access iAd. In fact, because of Apple’s policy, iAd will benefit at the expense of AdMob due to Apple’s presence in the mobile device market. It’s the diminishment of effective choices for developers in the mobile ad space that is the issue here.
No one is suggesting that a business should be forced to give data to competitors outright. However, this issue is complicated by competitors being in multiple vertical markets where one is being used to restrain options in the other.
@madmac
I know obnoxious people like you. They are wrong too!
@MadMac
“Just trying to walk the walk and not be a blind follower who thinks that everything Apple does is pure. I’m willing to be wrong, but never willing to be intellectually dishonest.”
The fact that I do not agree with you does not make me a “blind follower.” Let me try a bit of your rhetoric tactics – “What kind of a blithering dolt are you, MadMac?”
You had better be willing to be wrong, because you are intellectually challenged. If you started thinking with your balls, your IQ would immediately double. You have been called out multiple times and you refuse to back up your wild assertions.
You will be pleased to know that this is the last time that I will call you an idiot. I will waste no more time responding to a black hole.
I am not aware of a significant barrier to entry in the mobile ad space. There are tens of millions of non-iPhones in the hands of consumers. Microsoft, Google, and others claim that there will be hundreds of millions more non-iPhones sold over the next two years.
Without a monopolistic position or a significant barrier to entry in that market space, there is no antitrust case. Apple can taunt both the DOJ and the FTC with relative impunity, although it would be foolish to do so. In the meantime, competitors have a choice – either settle for the consumers who will settle for them, or learn from Apple’s successes and begin striving to actually compete. Apple will either marginalize the competition or drag them into a more reasonable product development strategy in spite of themselves.
OK, I don’t understand why everyone is so pissed at MadMac. While I may not agree with his perspective, it doesn’t seem like he’s being overly obnoxious or spewing out things he’s not trying to back up (at least in this thread).
As we all know, there are a lot worse out there who just can’t stand anything Apple!
MadMac = I’m a PC
Balblablabla…
@b,
Thank you.
I wish others here could disagree with me in such a mature manner. Like I said, I hope I’m wrong.
“… but every case increases its risk”
There is no ocean where there is no water.
Apple has no antitrust behavior. There is no risk of antitrust prosecution.
This article sounds FUD inspired.