> But after over a decade of being the best place in retail for retailers, you discover some of your retailers are taking customer orders in the mall, but delivering to their homes and billing online, so they don’t have to pay you 30%, or contribute anything for maintenance, security, or the value of being in your mall.

Apple can do whatever they want in their mall. This is about them preventing people from going to other malls. Let them enforce whatever they want for the retailers thatn want in their mall, as long as the same customers cane be served elsewhere.

Apple's doing the whole company store in the company town trick, except they've figured out that if the town is also separated by a hundred miles of company road that they can control, that makes it even harder for people to get out of the trap. You can argue all you want that it's okay that Apple takes 30% of the profit on any picks sold, and that the benefits they provide to keep their people safe is just that worth it, and that they've worked hard to provide a save environment by keeping everyone else a hundred miles away through their private roads, but we've seen this story before.

What makes Apple different in this case? Because people can just move to Android? Company town workers could have just left for different companies too.

The aspects of Apple's behavior are that they use their control of a large percentage of the US market to take actions against competitors.

Your example that you gave, would not be illegally anti-competitive, because a single mall is a small market.

If, instead, in the example you gave, the mall owner, owned half of all retail space, within a 100 mile radius (and a singular other competitor controlled the other half of all retail space within 100 miles), then the courts would absolutely call the behavior anti-competitive.

And before you say it, yes Apple is not a literal monopoly, but that does not matter. Apple is 1 half of a duopoly in the US, and that is bad enough, that their anti-competitive behavior should be regulated.

In the US, if a company has a large amount of market power, even if they are not a literal monopoly, then certain anti-competitive behavior becomes illegal.

And Google doesn’t control 100% of Android, there are alternate app stores available. So your analogy fails at multiple levels.

The Apple Mall succeeded because it’s a better customer experience, why should that be illegal, and why shouldn’t Apple benefit from their foresight and efforts?

The App Store is so big because Apple made it the best App Store. Every attribute of their walled garden contributes to its value, not just for Apple, but for developers and customers.

Apple has about 15% of phone sales. It’s developers make more than half the entire mobile app market revenues. How is Apples behavior hurting them?

I never said that getting 50% of the market, on its own, is anti-competitive.

Instead, what is anti-competive, is once you have a large amount of market power, such as 50%, it now becomes illegal to use anti-competitive practices to keep out competitors.

> No way a successful mall ..... merely for being successful.

I never said this. Instead, what I am saying is that using large amounts of market power, to keep out competitors, is anti-competitive.

> The App Store is so big because Apple made it the best App Store.

It doesn't matter if you got to 50% of the market through being good. It is still illegal to use large amounts of market power to keep out competitors.

> Apple has about 15% of phone sales.

Apple has 50% of the market in the USA. And the lawsuits are happening in the USA, so thats all that matters.

> How is Apples behavior hurting them?

It is hurting competing app stores from entering the market, because of Apple's actions that make it very difficult for competing app stores to be installed.

> why shouldn’t Apple benefit from their foresight and efforts?

They can benefit. They just shouldn't be allowed to use their large amount of market power to keep out competitors, because that is anti-competitive.

In this case it’s clearly not anticompetitive when forcing them to allow alternate app stores would be both anti-consumer and anti-developer.

Well, that is a pretty anti-competitive practice. So, actually, it seems like they might have an obligation to do this.

> It’s never been a feature they promised customer

It doesn't matter. It is still anti-competitive. And in the USA anti-competitive practices are illegal in the US, if a company with a large amount of market share is engaging in them.

> It’s not anticompetitive to refuse to build access to your property for new competitors.

It actually is! The courts have already proved this to be the case. Microsoft lost their court case because of a very similar situation.

I would really recommend that you go read up on similar anti competitive case, such as the Microsoft one, to learn the court justifications for this stuff. It is pretty enlightening.

> it’s not wanted by most app developers.

"Customers don't want competition" is not an argument that any court would accept. It is assumed to be true, automatically, that competition is a good thing.

And the judge residing over this case, actually made similar statements, in the preliminary hearing that I listened to, where she talked about how competition is a good thing, as a justification that the courts use.

Microsoft Windows had over 90% of the entire personal computer operating system market, which was clearly a de facto monopoly position. The antitrust element was them leveraging that monopoly to give them an ostensibly unfair advantage in the browser market. There was no "gatekeeping" aspect involved; it was about whether bundling application software with the OS to undermine commercial competition was fair.

Apple's case is very different. They have much less than 90% of the mobile phone operating system market, but they control access to 100% of the application market for iOS devices. This isn't about bundling, like Microsoft's case was, nor did Microsoft act as a gatekeeper for Windows. The closest precedents are game consoles, but those don't seem to offer a lot of guidance here in terms of case law -- although Apple's very likely to draw the comparison, e.g., Sony has a "monopoly" on downloadable applications for all PlayStations. Consumers know that limitation when they buy either a PlayStation or an iPhone, and see it as a feature, not a bug. In a lot of ways, the ultimate argument here is whether a device manufacturer can or should be legally forced to treat their devices more like general purpose computing devices than like consoles. And that's not like Microsoft at all. This is a fundamentally different question.

(The sort of ironic footnote in drawing a comparison to the Microsoft case is that while bundling IE with Windows killed Netscape's commercial prospects and it was certainly done with malice aforethought, it was also fundamentally the right call. Applications that achieve such amazing runaway success that their functionality quickly becomes essential to everyone are almost certain to be bundled into either the operating system or a suite that everyone has.)

It's also worth noting this was never actually ruled to be illegal. The appeals court remanded the question back to the district court for further analysis under the rule of reason, but that never actually happened as the case was eventually settled. Under the rule of reason, Microsoft would have been able to argue that it had legitimate justification for bundling a browser with Windows, and then it would have been up to the DOJ to argue that the anticompetitive effect of the bundling outweighed the justification given. I think Microsoft would have had a relatively strong argument there, as an operating system that shipped without a web browser (or media player, for that matter) would have been, in fact, less useful to the consumer.

There are whole industries built on iOS now, which was also true then, but due to the much more limited hardware landscape and single means of installing software, this now plays differently with competition than just browser bundling.

I don't think whether Apple is using monopoly power is the appropriate focus here; they can be anti-competitive without being a monopoly, and due to the fact that they control >1 billion users and control their hardware, there's a fair question to ask about this anti-competitive behavior.

Customers want the best possible products, forcing Apple to make their product worse, with worse security, a worse purchase experience, robs customers of an important choice.

Judges do make terrible rulings all the time. Like the Apple e-books case, where trying to ensure a level playing field was deemed “anti-competitive”, leading to Amazon to significantly grow market share and establishing an unassailable monopoly position since the ruling.

Once again, the government does not require a literal monopoly for behavior to be anti-competitive. 50% of a market in the US could absolutely be enough to count as significant market power.

The situations are pretty similar, because your argument about 90% is not what the courts care about. The courts care about market power, not necessarily a literal monopoly.

> Judges do make terrible rulings all the time

I mean, if you don't care about the courts system or the law, then I don't know what to tell you. Your opinion on it doesn't particularly matter, because the courts are the ones in charge of this, and the courts are the ones who make the decision here.

> Like the Apple e-books case

Well, too bad for Apple. The law is the law, and the court system is the court system.

Personally, I only talk about what the courts do. I don't really care about someone's opinion if the courts disagree with them. Because the courts and the judges are the ones that make the decision here. They decide.

And everything that I have said is within this context of what courts and judges have done in the past.

To be clear, whether the court cares about monopoly power or not depends on what type of claim you are making.

Section 1 of the Sherman Act deals with conspiracy and unreasonable restraints of trade and may not require establishing any market power at all. Some actions such as price fixing and bid rigging are considered per se illegal regardless of market power. Other actions (such as tying) require an analysis of market power, but not necessarily monopoly power.

Section 2 of the Sherman Act deals with monopolization and claims made under section 2 will require establishing monopoly power (or likelihood of achieving monopoly power, for attempted monopolization claims).

In the context of the Microsoft case, the 90% market share was indeed relevant to the court because several of the claims were brought under section 2, specifically having to do with Microsoft's unlawful attempts to maintain their operating system monopoly.

"Courts do not require a literal monopoly before applying rules for single firm conduct; that term is used as shorthand for a firm with significant and durable market power"

This is what I mean by that.

This applies to Section 2 of the Sherman Act, and the link that I posted mentions this. I do not mean what you are trying to say, which is that one section does not require a literal monopoly, and another does.

Instead, I am saying, that explicitly, for Section 2 of the Sherman Act, "monopoly" does not mean a singular firm, and the colloquial definition of that, is incorrect.

Instead, it only requires significant market power.

> will require establishing monopoly power

"Monopoly power" can absolutely exist in the case of a company having 50% of the market. This is what that government statement means.

iPhones currently have around 45% market share in the US: https://www.statista.com/statistics/236550/percentage-of-us-...

Whether monopoly power will be found in this situation will be up to a court and it's far from a slam dunk.

For a more detailed examination of the factors involved in determining monopoly power please see this article: https://www.justice.gov/atr/competition-and-monopoly-single-...

Yes... But it is very much not true that a court requires a literal monopoly in order for them to find behaviors to be anti-competitive. All that needs to happen is for a company to have significant market power.

So it is not a literal monopoly. Instead, it it having significant market power. And in the US, as of last month, if you are keeping up with the most recent data regarding market share, Apple has about 50% of the US market.

> iPhones currently have around 45%

Your data is about 6 months out of date. it is now around 50%. It is very much a defendable argument, that has a reasonable chance of standing up in court, that Apple, who has about half the market, in what is effectively a 2 player duopoly, could have significant market power.

That is a pretty reasonable argument, that has a real, non-negligible, possibility of standing up in court.

If by literal monopoly you mean a single firm that controls 100% of the market, then we don't disagree, as I never suggested that was required. However, proving a section 2 monopolization claim does require proving the existence of monopoly power.

A company is considered to have monopoly power when it has a significant degree of market power. A literal monopoly is not required, however courts have typically not found monopoly power when market share is below 50% either.

> And in the US, as of last month, if you are keeping up with the most recent data regarding market share, Apple has about 50% of the US market.

Can you cite a specific source? I've seen all sorts of different numbers but some seem to be based on web browser usage or device shipments which is not quite the same as active users.

> That is a pretty reasonable argument, that has a real, non-negligible, possibility of standing up in court.

While I certainly think it's possible, the case becomes a lot easier if the company has 90% market share (as Microsoft did) compared to 50% market share.

In other words, I find the comparison to the Microsoft case lacking because with 90% market share it was more or less accepted by both sides that Microsoft held monopoly power in the operating system market, whereas in this situation it's much more debatable. To quote from my previous link:

In determining whether a competitor possesses monopoly power in a relevant market, courts typically begin by looking at the firm's market share.(18) Although the courts "have not yet identified a precise level at which monopoly power will be inferred,"(19) they have demanded a dominant market share. Discussions of the requisite market share for monopoly power commonly begin with Judge Hand's statement in United States v. Aluminum Co. of America that a market share of ninety percent "is enough to constitute a monopoly; it is doubtful whether sixty or sixty-four percent would be enough; and certainly thirty-three per cent is not."(20) The Supreme Court quickly endorsed Judge Hand's approach in American Tobacco Co. v. United States.(21)

Following Alcoa and American Tobacco, courts typically have required a dominant market share before inferring the existence of monopoly power. The Fifth Circuit observed that "monopolization is rarely found when the defendant's share of the relevant market is below 70%."(22) Similarly, the Tenth Circuit noted that to establish "monopoly power, lower courts generally require a minimum market share of between 70% and 80%."(23) Likewise, the Third Circuit stated that "a share significantly larger than 55% has been required to establish prima facie market power"(24) and held that a market share between seventy-five percent and eighty percent of sales is "more than adequate to establish a prima facie case of power."(25)

It is also important to consider the share levels that have been held insufficient to allow courts to conclude that a defendant possesses monopoly power. The Eleventh Circuit held that a "market share at or less than 50% is inadequate as a matter of law to constitute monopoly power."(26) The Seventh Circuit observed that "[f]ifty percent is below any accepted benchmark for inferring monopoly power from market share."(27) A treatise agrees, contending that "it would be rare indeed to find that a firm with half of a market could individually control price over any significant period."(28)

In other words, 50% is near the bottom of the range, and is going to be hotly contested.

And the courts have yet to interpret what is illegal in the same manner that HN “lawyers” do....

In similar cases, they absolutely have talking about what is illegal, regarding anti-competitive behavior.

I would encourage you to read up on similar cases, in order to see what courts have said on the matter.

And the courts have said that it does not require a literal, singular monopoly in order for anti-competitive behavior to be illegal.

All that has to happen is for a company to have significant market share, for anti-competitive behavior to be illegal.

There is a reason why HN lawyers get all hand wavy when asked to come up with similar examples.

The difference is that in the real world, there is more property.

In the digital world, there isn't, unless you count Android -- and the problem with that is you run into the "Well why don't the company men just leave the company town, then?" It's the "let them eat cake!" argument and it doesn't go over well.

Yet and still console makers have been doing just this for 30 years.

Yes physical games still have to be approved by the console makers and the practice has not been eliminated.

Which is more likely, companies have been breaking the law for years or HNs understanding of the law is flawed?

It is well accepted in anti-competition law, that the size of the market and market share matters greatly in determining whether certain behavior is illegal.

The larger the market share that a company has, and the larger the market, the more likely the anti-competitive behavior is to be illegal.

So, in the case of consoles, consoles have a smaller market and market share than Apple does.

Apple is now a 2 trillion dollar company, and has about 50% of the phone market share, in the US, as of last month.

They have significantly more control over a significantly larger market than consoles. Thus their behavior is much worse and much more likely to be illegal than that of consoles.

> Which is more likely, companies have been breaking the law for years or HNs understanding of the law is flawed?

Whats more likely is that you have not read any actual court cases or judicial decisions on the matter, to be frank.

The stuff that I states is pretty well accepted among the experts.

And it seems like none of the “experts” have won anymore cases in court where one company that didn’t have overwhelming share was convicted of anti trust than anyone posting on HN.

None of what you said is anti-competitive since you left out the anti-competitive part of the story.

The only mall that is allowed is that one single mall. You are not allowed to start your own mall and since there are no other malls you cannot move to another one. You are basically stuck putting your store in that mall or not having a store at all.

While it is possible to move to another city people have grown accustomed to the city they live in. There could be certain amenities that are not available in that other city (imessage being the biggest one. Some people get less messages since they have a different color bubble if they are not on imessage.).

People may want to vote for different / changed restrictions on malls but they realize the city they moved to is not a democracy. It is a dictatorship. The person who owns the mall also makes all the laws and they won't allow you to start your own mall since it would cut into their profits. They make the claim it is about your security. If somebody starts their own mall they won't be able to ensure you won't get mugged. Instead of letting you take a chance in a new mall they just ban their competitors outright.

Then the Apple mall is taking 30% and someone says they want to set up their own mall somewhere else. It's a completely separate "mall" -- apps hosted on different servers with different payment processing etc. But then Apple says not only that nobody who shops in their mall can go shop in any other mall too, but also that nobody who lives in a house they built can either. How is that not anti-competitive?

And it has a great mall that helps Apple keep the village secure. The merchants make a great deal of money, which ensures you don’t lack for choice and quality. And you are happy to shop there because Apple vets the merchants, and handles the purchase system, so it’s easy for you to get refunds and deal with subscriptions.

There are other malls, but not on Apple Village property,they are really hard to get to and Apple doesn’t help you get there. But you knew this because it hadn’t changed for 13 years.

So why should Apple be forced to build an expressway on their property to make it easy for you to shop at these other malls? They never promised you that yet you moved to Apple Village all the same.

And they have good reasons not to. Not only does it reduce safety and security for Apple Village residents, they just got easier to scam. Potential new Apple Village residents will be less likely to move in. Apples best merchant partners will lose customers and money.

Allowing the residents of "Apple Village" to go to another mall to shop does not in any way affect the other residents.

Nobody is arguing for Apple to be "forced to build an expressway", but for them to not put up fences locking their resident in unless they decide to move away entirely.

When one ends up arguing in favour of authoritarianism, albeit fictional, to defend Apple's behaviour, it really drives things home.

"If you don't like it then leave." Is that supposed to be a real solution? What if you have just as many issues with the other remaining superpower?

Competition is supposed to be constraining abuse. That doesn't work if to compete on apps you have to be able to develop your own phone platform and convince your entire app customer base to switch to it.

If you don’t like it, buy something else. Don’t expect the platform to be made worse to fit your specific needs, when they clearly don’t match up to the overwhelming choices of customers.

If you want Apple hardware or iOS but not their app store, it's not available. If your whole family uses iMessage then you need an iPhone even if you don't want any of the rest of it. The fact that many people then buy an iPhone and use the App Store regardless is not evidence that they want it this way, it's the harm that forcing it to be this way is inflicting on them.

It doesn't even prove that there are enough such people to fill a single telephone booth. They could make a billion sales and every one of them could be people who don't want to be tied to Apple's store but grin and bear it because they want iOS or Apple hardware more, or because they think Google is worse.

When they don't have the choice to get one without the other, people buying both doesn't prove that they want both, only that the thing they actually want isn't a choice they have. To prove what they actually want you'd have to give them the option to have that.

> Why should they be deprived of the benefits of the walled garden just because you don’t like it?

Why should the people who don't want it have it forced on them?

If you want Apple hardware with iOS and to buy all your apps from Apple's store, why can't you choose that without forcing all the people who don't want that into an all or nothing choice between every one of those things and not a single one of them?

https://www.thebalancesmb.com/average-percentage-commercial-...