1/ The xCloud on iOS situation is a perfect encapsulation of the antitrust argument for and against Apple. Microsoft is going to be just fine building their business on Xbox, Windows, and Android. iPhone customers who care about Xbox can switch to Android.
2/ This, in some ways, reduces Apple’s power over their customers. A compelling feature exclusive to another platform might actually cause some number of people switch from iPhone to Android. Having compelling platform exclusives _can_ be healthy for competition.
3/ Any argument that Apple is wielding monopoly-like power over its platfom hinges on switching costs. Do people stay on iPhone because its too much of a hassle to switch or because the iPhone experience is compelling enough to keep them even without xCloud & other rejected apps.
4/ Low switching cost example: Walmart carries guns, Target doesn’t. Forcing Target to carry guns because Target shoppers are being deprived the right to buy guns doesn’t make any sense. Target shoppers who want to buy guns can drive to Walmart (or elsewhere) and buy guns.
5/ Apple should only be forced to approve certain apps (or adjust developer terms like the rev-share) if switching costs (for customers and developers) are found to be too high AND the reason for the rejection (or rev-share percentage) is anti-competitive.
6/ Otherwise Apple, like any other company, should be left to compete as it sees fit. Especially given how much value they create for their customers and how much they push the industry forward on things like privacy.
7/ So many anti-Apple arguments start with the assumption that Apple is a monopoly and then devolve into “developers/customers have a right to X, because monopoly”. And if that’s the case, Facebook has the right to collect any data they want on iOS, Apple shouldn't stop them.
8/ I personally think switching costs are high enough to justify antitrust regulation, but I also think there are ways Apple can side-step the switching cost arguments and reduce the scope/likelihood of regulation.
9/ Web-based app distribution as done on macOS (with a certificate signed by Apple) would be one of the most obvious things Apple could do. And they could even limit certain system-level features like Apple Pay for security and competitive reasons.
10/ This would open a pretty big can of worms (like Microsoft/Steam/Facebook creating their own game stores), but at some point Apple needs to put its big person pants on and figure out how to compete on customer/developer experience, not lock-in.
11/ Apple also needs to respect users enough to let them make their own decisions. If an app has a bad user experience, drains the battery like crazy, or does something else that wouldn't fly on the App Store, let the customer decide (but also feel free to shame bad actors).
12/ And let’s not forget that making iPhones, iPads, and even Apple TVs into better gaming devices — and more open to apps and business models Apple would otherwise reject — is going to help sell a lot of high-margin hardware.
13/ It all makes sense except for Apple’s incessant drive for services revenue and institutional appetite for control. Those two self-owns will likely force regulators’ hands and end up doing more harm in the long run than would’ve been done by a narrow path around the App Store.
(Yes, there are holes in this line of reasoning, so feel free to @ me. But I’m going to completely ignore you if you don’t take a minute to really think about things and come up with well-reasoned rebuttals.)
On my drive home after tweeting this thread, I listened to part of this week’s @exponentfm. @benthompson mentioned the exceptions Apple has granted WeChat in China. They do all sorts of stuff (like having a mini App Store in the app) that Apple doesn’t allow other apps to do.
And guess what? The App Store has still been doing quite well in China and the iPhone is still able to compete on brand, usability, hardware, and other features.
