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walkitoutToday, I read an article about the Epic / Apple and Epic / Google antitrust case(s) _which bothered to get a quote from Hovenkamp_. Well, that’s worth paying attention to!
What did he say?
https://www.washingtonpost.com/technology/2021/04/30/epic-apple-trial-antitrust-fortnite-app-store/
“ “Frankly, for Epic, it’s been a case of very good timing, because pretty much everybody around the world is looking at this problem,” said Herb Hovenkamp, an antitrust professor at the University of Pennsylvania Law School. “The DOJ I’m sure is paying close attention to this.””
He’s not wrong (this is Hovenkamp on the topic of antitrust. Go find an example of him ever being wrong within that area of expertise. I won’t wait, tho, because you’ll be a while.). But look at all the things that he’s not saying. And look at what he highlighted as Epic’s strength.
I have mostly paid zero attention to the Epic / Apple and Epic / Google cases, because these are all Giant vs. Giant, and while one or more of them may pretend to be David to someone else’s Goliath, it is very much all a pretense. Also, you will note in the article that while Varney did well tilting up against Microsoft, it’s not like that ultimately benefitted Netscape in any really meaningful way (to be fair, it was pretty damaging to Microsoft, which is not something to ignore).
The 30% commission is pretty standard (extremely standard — the primary ways not to pay it are to basically be so small that no one wants to go to the trouble of doing vender support/customer service for that small a penny and so they would just as soon let you have it for free so they can tell you to go fuck yourself if you try to complain). However, it is worth thinking about that 30% commission.
Let us imagine a situation in which, say, there is an app that lets you read, say, books on an iOS device. And let us further imagine a situation in which you can buy the books you would read through that app from the purveyor of the app. Does Apple collect a commission on the sale of the book? Once upon a really fucking long time ago, when I was looking to replace my Bricked Itself Blackberry Curve, and an iPhone was looking like the only real choice, This Was My Question. I was not sure I wanted to commit to an ecosystem in which I could not read the ebooks I bought on Amazon on an Amazon app on an iPhone. And there was some back and forth about that between Apple and Amazon (I do not mention the antitrust case between Apple and Amazon, in which situation Apple quite blatantly engaged as the hub of a hub and spoke trust to set prices and then attempted with the Publishers who were acting as the Spokes to sic the DOJ on Amazon. I think we all know how that turned out.), and the A’s of FAANG came to an agreement and I bought an iphone, and mostly continue to read books on my kindle but on occasion I open up a book on my iPhone or iPad and am generally satisfied with the experience. The primary sticking point is that I tend not to shop on my Amazon App on my iphone or iPad, because I cannot buy kindle books there (if they were sold through the app, they would pay the commission), and so I just always go to my browser instead for shopping on Amazon. It’s fine.
Is there an analogy that could be drawn here?
Maybe. Maybe not.
There’s an interesting argument here:
https://truthonthemarket.com/2020/08/27/the-epic-flaws-of-epics-antitrust-gambit/
It looks at the standoff from multiple positions, and takes a pretty dim view of what Epic is up to, in terms of whether Epic can benefit from any possible outcome (see: my comment about Varney, Netscape and Microsoft above, but made without resort to personality). I think Epic would _like_ it if they could somehow become Amazon in an ebook analogy.
I think, however, they are a lot more likely to be Rowling / Pottermore.
ETA: Also, I know there has been a bunch of loose talk about whether Apple actually provides a meaningful amount of security in exchange for its walled garden approach. I’ll just note that in this _particular_ situation, I am _entirely_ in favor of the walled garden, and if it looks in danger of being breached, it will be the Next Thing I Yammer About to every candidate I talk to. I’m fine with y’all going after Big Tech; it’s important to keep these folks on their toes. Just don’t make my phone less secure while you are at it.
The Ben Evans piece linked to in the piece above — https://www.ben-evans.com/benedictevans/2020/8/18/app-stores — seems to think that the Kindle problem that I found worrisome at the beginning but no problem to speak of now is actually the reverse, because iOS is now so huge. I dunno. Android provides a LOT of choice. I really don’t want to see _any_ crack in the dike of All Payments Go Through Apple. I don’t use any music streaming services (unreconstructed AOR person, right here, sorry not sorry, altho really more the AO part than the R part, but never mind that now) so I cannot speak to what it is like to interact with Spotify.
AGAIN feel free to keep the tech giants on their toes — just don’t turn my phone into a malware ridden piece of crap.
ETAYA: I don’t endorse the organization that I linked to above; I’m not familiar with them, and suspect I will be annoyed by a large chunk of what they say. I just thought they had a pretty interesting roundup of perspectives on Epic / Apple.
ETA Burying the Lede:
https://www.theverge.com/2021/4/28/22407939/fortnite-biggest-platform-revenue-playstation-not-ios-iphone
R. and I were discussing this, and central to _every_ antitrust case is “defining the relevant market”. While Epic obviously would like to define the relevant market in its case against Apple as the App Store, and the relevant market in its case against Google as the Play Store, the judge, ultimately, listens to both sides and decides what the correct market is. This is important, because if you do not dominate a market, you cannot abuse market power which you do not have. By definition. This can have some really interesting effects! So, never, ever, ever skip over this step lightly. I was looking for the answer to the question of, where does Fortnite make the most money, because _if it is not iOS_, then you will probably be watching the judge bring in every other place that Fortnite is being sold / making money and include that in the market while assessing how much control Apple has over that market. Basically, if Wonder Bread sues a tiny bodega for how it is treating Wonder Bread, and saying the Bodega has market dominance over something or other, the judge is gonna go: where else is Wonder Bread selling? Let’s include all of them into this whole market analysis thing.
Answer bad for Epic’s case! IOS is where it makes the least money.
“ Court documents reveal that PlayStation 4 generated 46.8 percent of Fortnite’s total revenues from March 2018 through July 2020, while Xbox One, the second-highest platform, generated 27.5 percent. iOS ranked fifth, with just 7 percent of total revenue. The remaining 18.7 percent would have been split between Android, Nintendo Switch, and PCs.”
Adding back the entire 30% commission would NOT change that ranking!
I will note, however, that if Fortnite could break the control imposed on payments by the phone stores, they might be able to make a lot more than 30% more, at least until parents figured out where the hole in their wallet was.
What did he say?
https://www.washingtonpost.com/technology/2021/04/30/epic-apple-trial-antitrust-fortnite-app-store/
“ “Frankly, for Epic, it’s been a case of very good timing, because pretty much everybody around the world is looking at this problem,” said Herb Hovenkamp, an antitrust professor at the University of Pennsylvania Law School. “The DOJ I’m sure is paying close attention to this.””
He’s not wrong (this is Hovenkamp on the topic of antitrust. Go find an example of him ever being wrong within that area of expertise. I won’t wait, tho, because you’ll be a while.). But look at all the things that he’s not saying. And look at what he highlighted as Epic’s strength.
I have mostly paid zero attention to the Epic / Apple and Epic / Google cases, because these are all Giant vs. Giant, and while one or more of them may pretend to be David to someone else’s Goliath, it is very much all a pretense. Also, you will note in the article that while Varney did well tilting up against Microsoft, it’s not like that ultimately benefitted Netscape in any really meaningful way (to be fair, it was pretty damaging to Microsoft, which is not something to ignore).
The 30% commission is pretty standard (extremely standard — the primary ways not to pay it are to basically be so small that no one wants to go to the trouble of doing vender support/customer service for that small a penny and so they would just as soon let you have it for free so they can tell you to go fuck yourself if you try to complain). However, it is worth thinking about that 30% commission.
Let us imagine a situation in which, say, there is an app that lets you read, say, books on an iOS device. And let us further imagine a situation in which you can buy the books you would read through that app from the purveyor of the app. Does Apple collect a commission on the sale of the book? Once upon a really fucking long time ago, when I was looking to replace my Bricked Itself Blackberry Curve, and an iPhone was looking like the only real choice, This Was My Question. I was not sure I wanted to commit to an ecosystem in which I could not read the ebooks I bought on Amazon on an Amazon app on an iPhone. And there was some back and forth about that between Apple and Amazon (I do not mention the antitrust case between Apple and Amazon, in which situation Apple quite blatantly engaged as the hub of a hub and spoke trust to set prices and then attempted with the Publishers who were acting as the Spokes to sic the DOJ on Amazon. I think we all know how that turned out.), and the A’s of FAANG came to an agreement and I bought an iphone, and mostly continue to read books on my kindle but on occasion I open up a book on my iPhone or iPad and am generally satisfied with the experience. The primary sticking point is that I tend not to shop on my Amazon App on my iphone or iPad, because I cannot buy kindle books there (if they were sold through the app, they would pay the commission), and so I just always go to my browser instead for shopping on Amazon. It’s fine.
Is there an analogy that could be drawn here?
Maybe. Maybe not.
There’s an interesting argument here:
https://truthonthemarket.com/2020/08/27/the-epic-flaws-of-epics-antitrust-gambit/
It looks at the standoff from multiple positions, and takes a pretty dim view of what Epic is up to, in terms of whether Epic can benefit from any possible outcome (see: my comment about Varney, Netscape and Microsoft above, but made without resort to personality). I think Epic would _like_ it if they could somehow become Amazon in an ebook analogy.
I think, however, they are a lot more likely to be Rowling / Pottermore.
ETA: Also, I know there has been a bunch of loose talk about whether Apple actually provides a meaningful amount of security in exchange for its walled garden approach. I’ll just note that in this _particular_ situation, I am _entirely_ in favor of the walled garden, and if it looks in danger of being breached, it will be the Next Thing I Yammer About to every candidate I talk to. I’m fine with y’all going after Big Tech; it’s important to keep these folks on their toes. Just don’t make my phone less secure while you are at it.
The Ben Evans piece linked to in the piece above — https://www.ben-evans.com/benedictevans/2020/8/18/app-stores — seems to think that the Kindle problem that I found worrisome at the beginning but no problem to speak of now is actually the reverse, because iOS is now so huge. I dunno. Android provides a LOT of choice. I really don’t want to see _any_ crack in the dike of All Payments Go Through Apple. I don’t use any music streaming services (unreconstructed AOR person, right here, sorry not sorry, altho really more the AO part than the R part, but never mind that now) so I cannot speak to what it is like to interact with Spotify.
AGAIN feel free to keep the tech giants on their toes — just don’t turn my phone into a malware ridden piece of crap.
ETAYA: I don’t endorse the organization that I linked to above; I’m not familiar with them, and suspect I will be annoyed by a large chunk of what they say. I just thought they had a pretty interesting roundup of perspectives on Epic / Apple.
ETA Burying the Lede:
https://www.theverge.com/2021/4/28/22407939/fortnite-biggest-platform-revenue-playstation-not-ios-iphone
R. and I were discussing this, and central to _every_ antitrust case is “defining the relevant market”. While Epic obviously would like to define the relevant market in its case against Apple as the App Store, and the relevant market in its case against Google as the Play Store, the judge, ultimately, listens to both sides and decides what the correct market is. This is important, because if you do not dominate a market, you cannot abuse market power which you do not have. By definition. This can have some really interesting effects! So, never, ever, ever skip over this step lightly. I was looking for the answer to the question of, where does Fortnite make the most money, because _if it is not iOS_, then you will probably be watching the judge bring in every other place that Fortnite is being sold / making money and include that in the market while assessing how much control Apple has over that market. Basically, if Wonder Bread sues a tiny bodega for how it is treating Wonder Bread, and saying the Bodega has market dominance over something or other, the judge is gonna go: where else is Wonder Bread selling? Let’s include all of them into this whole market analysis thing.
Answer bad for Epic’s case! IOS is where it makes the least money.
“ Court documents reveal that PlayStation 4 generated 46.8 percent of Fortnite’s total revenues from March 2018 through July 2020, while Xbox One, the second-highest platform, generated 27.5 percent. iOS ranked fifth, with just 7 percent of total revenue. The remaining 18.7 percent would have been split between Android, Nintendo Switch, and PCs.”
Adding back the entire 30% commission would NOT change that ranking!
I will note, however, that if Fortnite could break the control imposed on payments by the phone stores, they might be able to make a lot more than 30% more, at least until parents figured out where the hole in their wallet was.