In the context: Apple has kept its walled garden under tight control for a long time, and there have been very few customer complaints. However, the company has faced growing criticism from developers and regulators regarding its control. Gradually, lawsuits forcing him to allow third-party stores to compete and demands from regulators around the world undermined the pillars of iOS’s walled garden. While they didn’t collapse, some say the business model is “unsustainable”, including Mark Zuckerberg.
Wednesday The New York Times placed its annual DealBook Summit. Technology industry professionals and journalists were in attendance to see and hear industry leaders express their opinions on everything from the future of cryptocurrencies to rising demands for stricter regulations for some of the most prominent corporations.
Conversation with Meta CEO Mark Zuckerberg disclosed that he doesn’t think Apple can continue to fence off iOS from other app stores that want to compete with it for the iPhone customer business. He believes isolating App Store-only apps so that Apple can charge a 30 percent commission on every app and all in-app sales is not “sustainable or good.”
“Of the major computing platforms, Apple stands out,” Zuck said. “This is the only time that one company can control which apps get on the device. I don’t think it’s sustainable or good. [Unlike a government]Apple clearly has [its] own interests [and] the fact that companies must source their applications exclusively from platforms controlled by competitors is a conflict of interest.”
He pointed to the recent spat this week between Apple and Elon Musk as an example of what can happen when one company has complete control over a platform. Musk claimed that Apple threatened to remove his newly acquired Twitter app from the App Store due to content moderation. Musk has since said that it was all a misunderstanding and that they are back on good terms. However, that didn’t happen when Epic Games faced the Cupertino powerhouse.
More than two years ago, Epic challenged Apple’s closed ecosystem when it circumvented the so-called “Apple Tax” by requiring Fortnite players to buy 30 percent off in-game items from a store not controlled by Apple. In response, Apple removed Fortnite from the App Store, sparking a massive antitrust lawsuit.
Ultimately, the courts settled the case predominantly in favor of Apple, but neither side was completely satisfied with the outcome. Both filed appeals that continue to rage through the judiciary. Meanwhile, Fortnite is still banned from the App Store indefinitely, excluding Epic’s revenue stream from the iOS platform.
Twitter’s former head of trust and safety told The Times last month that if Apple or Google ban Twitter from any marketplace, the results will be “disastrous”. He believes that Apple and Google can use this dominance to put pressure on content moderation. In other words, if user-generated content is not moderated in a manner that Apple or Google agrees to, threatening to remove an app can cause compliance and censorship.
While the comparison of Apple’s and Google’s manipulative capabilities is fair, Zuckerberg didn’t say they were using the same business model.
“Google can control what happens in the play store [sic]but they have always made it so that you can download third-party apps and have other app stores and work directly with phone manufacturers,” said the head of Meta.
Of course, it’s worth mentioning that Zuck has an ongoing grievance with Apple over its ad transparency policy.
In 2020, the company decided that developers need to be more honest and upfront about the data they collect from iPhone users and how they use and share that information. Facebook immediately warned advertisers that the results of Apple’s new rules would be “disastrous.”
So far, advertisers seem to be still advertising. So, apparently, the “apocalypse” was avoided.
Image credit: Anthony Quintano