Between the Lines

Larry Dignan, Andrew Nusca and Rachel King

Apple vs. Adobe on antitrust: Should regulators dictate what's in an SDK?

By | May 4, 2010, 6:44am PDT

Apple is reportedly facing an antitrust investigation at the behest of Adobe, but there’s one irksome question: Should antitrust delve into the guts of a software developer kit?

Initial reports about a potential antitrust inquiry based on the iPhone 4.0 terms of its SDK appear to be on target. And now Bloomberg says Adobe requested the review.

As a review the item in question is section 3.3.1, which is basically the no Adobe Flash clause.

3.3.1 — Applications may only use Documented APIs in the manner prescribed by Apple and must not use or call any private APIs. Applications must be originally written in Objective-C, C, C++, or JavaScript as executed by the iPhone OS WebKit engine, and only code written in C, C++, and Objective-C may compile and directly link against the Documented APIs (e.g., Applications that link to Documented APIs through an intermediary translation or compatibility layer or tool are prohibited).

Regulators would obviously want Apple to open that up so third party intermediary layers (like Adobe). How meddlesome is this really? OK, Apple CEO Steve Jobs hates Flash and frankly I can’t disagree with a lot of his points about the software. Flash does need some work. Should Apple really be forced to offer options when it thinks Flash sucks? Meanwhile, Apple has 25 percent of the smartphone market in the U.S. (Comscore) and 16 percent globally (IDC).

If Apple wants to stump for HTML 5 or some other standard it can. If your iPad doesn’t deliver Flash you can always get annoyed and buy something else. Apple simply doesn’t have the world domination market share in the iPhone or iPad for regulators to give a hoot. Sure, Adobe has a serious business risk to worry about, but it’s betting on Android. Perhaps Android kicks the iPhone’s arse in a year or two.

In other words, Apple can block Flash and pay the consequences in the marketplace. The tech industry isn’t some playground where the score is never kept (an annoying practice considering every kid on the field can tell you who won or lost and the score).

Call me crazy, but I’m not sure I want the Feds playing around with SDKs. It smells like micromanagement to me and that’s dangerous. It’s bad enough that regulators are likely to overreach everywhere—do they really have grounds to shoot down Google’s AdMob acquisition?

In a nutshell, the Adobe-Apple PR battle is interesting, but the big question here may revolve around regulatory power.

Poll

Apple's SDK: Should antitrust regulators be allowed to crowbar Adobe in?

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Larry Dignan is Editor in Chief of ZDNet and SmartPlanet as well as Editorial Director of ZDNet's sister site TechRepublic.

Disclosure

Larry Dignan

Larry Dignan has nothing to disclose. He doesn’t hold investments in the technology companies he covers.

Biography

Larry Dignan

Larry Dignan is Editor in Chief of ZDNet and SmartPlanet as well as Editorial Director of ZDNet's sister site TechRepublic. He was most recently Executive Editor of News and Blogs at ZDNet. Prior to that he was executive news editor at eWeek and news editor at Baseline. He also served as the East Coast news editor and finance editor at CNET News.com. Larry has covered the technology and financial services industry since 1995, publishing articles in WallStreetWeek.com, Inter@ctive Week, The New York Times, and Financial Planning magazine. He's a graduate of the Columbia School of Journalism and the University of Delaware.

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Talkback Most Recent of 276 Talkback(s)

  • Apple isn't a monopoly
    not yet anyway, why the special case antitrust laws don't apply.
    Apple's argument about Flash being crap is valid and I as a user is happy with the decision.

    "Antitrust move against Apple would 'sink,' says expert"
    http://www.computerworld.com/s/article/9176274/Antitrust_move_against_Apple_would_sink_says_expert
    ZDNet Gravatar
    Mikael_z
    4th May 2010
  • What constitutes a "monopoly"
    what crieteria do you have to meet to be ruled a monopoly?
    ZDNet Gravatar
    John Zern
    4th May 2010
  • ZDNet Gravatar
    ye
    4th May 2010
  • Sure ye
    Yeah, that's all there was to it. Cry us a river.
    ZDNet Gravatar
    jaypeg
    4th May 2010
  • It's funny to watch the defense of Apple as a monopoly.
    I don't know if they can be considered one or not. But the Apple fanboy's are falling all over themselves defending Apple using the same arguments the Microsoft fanboy's used to defend Microsoft. Now that the name has changed these previously invalid arguments (according to the Apple fanboys) are all of a sudden valid.
    ZDNet Gravatar
    ye
    4th May 2010
  • ZDNet Gravatar
    DonnieBoy
    4th May 2010
  • what % of the tablet category does the magical device own
    If it isn't 90% already it would be soon.

    After all this is a whole new category right, or for the purpose of antitrust should it just be lumped together with phones and computers so that Apples % is lower.

    I bet MS wished they wouldn't have been narrowed down to just Desktop, throw in all of the servers / phones out there and MS probably wouldn't have been a monopoly either.
    ZDNet Gravatar
    RichHalvor
    4th May 2010
  • legal definition
    "Monopoly is a control or advantage obtained by one entity over the commercial market in a specific area. Monopolization is an offense under federal anti trust law. The two elements of monopolization are (1) the power to fix prices and exclude competitors within the relevant market. (2) the willful acquisition or maintenance of that power as distinguished from growth or development as a consequence of a superior product, business acumen or historical accident.

    A market condition in which there is only one seller and one buyer is called a bilateral monopoly. A situation where one buyer controls the market is called monopsony."
    U.S. Legal Definitions

    So, if you consider apples market relevant then they are a monopoly, which is not illegal btw....however using restrictive trade practices for that market is.
    ZDNet Gravatar
    desamuelson
    4th May 2010
  • ZDNet Gravatar
    CyberGuerilla
    4th May 2010
  • ZDNet Gravatar
    CyberGuerilla
    4th May 2010
  • They Only Have to Use Anti-Competitive Tactics!
    Whether Apple or Microsoft are True Full Monopolies or
    not, isn't the question Adobe is asking here. What they
    are asking is if Apple is using Anti-Competitive Tactics
    to lock competitors out of their platform.

    No one here can answer that question. That's why Adobe is
    has requested an inquiry. So that can be determined. No
    matter how you answered the survey or however wish the
    outcome to be, doesn't really matter. It doesn't even
    matter that some supposed expert has pre-determined that
    Adobe's request is bogus or will not fly past being a pig
    in the sky shot out of a canon!

    The truth is, if the inquiry is successful Apple will be
    required to oblige the legal findings here in the USA.
    But remember....., Apple still has the rest of the World
    to contend with on this and there are already foreign
    forces gathering to contest Apple's Market Dictatorship!

    We all know the Europeans aren't too keen on any anti-
    competitive Corporate maneuvering and market
    manipulation. So...... I'll be content to stock up on
    popcorn and watch the fireworks around the World as Adobe
    is not going to be the last Software company that joins
    the fray! grin
    ZDNet Gravatar
    i2fun@...
    4th May 2010
  • I was thinking the same thing:
    How many *stupid* people out there? Let's see ... raise your hand (and open your mouth so you can put your foot in it) if you think Apple has a monopoly in *any* market or consumer product sector.

    Yep. There are plenty of stupid people out there.

    And, no, the "Smart Phone [______(fill in the blank with electronic device of your choice)] That Stands Out As Singularly Well-designed, Supported, and Developed-for with Superlative GUI" market doesn't count.

    IF it did, then, yes, all you cry-babies *could* claim that Apple does have a monopoly.

    But the DOJ isn't really concerned about that.

    If any of you cry-babies are *not* really as stupid as you sound and really *do* believe (for anything resembling a good reason) that Apple does have anything resembling a "monopoly" in any sector, then ... I'll bet you (if you have any gonads) that this *talk* will never amount to anything.

    It's just a subject for much hot air and wringing of hands by those [mostly MCSE monkeys and IT support people] for whom all this movement away from overly-complicated "POS" OSes and "Beige Boxes" bodes no good.
    ZDNet Gravatar
    brian ansorge
    4th May 2010
  • The difference
    The difference is simple, the Apple fanbois are right when using these
    arguments, the MS fanbois were wrong. It all boils down to a basic
    understanding of anti-trust laws. Read the MS vs DOJ decision all the
    arguments are spelled out for you there.
    ZDNet Gravatar
    jaypeg
    4th May 2010
  • You can spin it any way you want.
    The Apple fanboys are being hypocritical.
    ZDNet Gravatar
    ye
    4th May 2010
  • No.
    Apple fanbois tend to educate themselves and make the correct
    arguments at the correct time.
    ZDNet Gravatar
    jaypeg
    4th May 2010

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