Apple is immune from antitrust
Summary: The hottest consumer electronics company is Apple. Is it safe from government litigation? Maybe Google should license iPAD killing future litigation.
The hottest consumer electronics company is Apple. It has a strong developer eco-system for iPhone and iPad. Sales forecasts for these products will surpass analyst expectations. Apple is financially healthy and current stock market darling. Is Apple safe from government anti-trust litigation? Some argue they should be a target. I suspect it would be a very weak case and never pursued.
There has been some consumer and developer backlash of its policies, but most drink and love the company Kool-Aid. Some developers are mad and feel abused. There is excitement because of the launch of the Android phone OS and the Nexus One along with Google's book service; maybe they'll leave Apple, except the damned roll out of the iPad is so tempting and worth putting up with Apple's dictatorial behavior. Apple is betting on it. Since the market offers developers and consumers choice, no monopoly exists. The titans will clash creating healthy competition. Google is consistently on the defensive in court, while Apple consistently attacks.
Microsoft lags (OK, let's be honest, it's dead last) in the phone and 'reader' markets. Some suggest the company will never be a serious player in consumer smart / multi-function device space. They need to build a decent product before complaining. When Microsoft announced the Windows 7 phone killing Windows 6.5 / CE, it forced developers into catch-up mode. Google and Apple pulled farther ahead. Microsoft can't blame anyone but itself, end of story. Zune is a cool product, but lacks a cult like following that Amazon Kindle and Apple have with its customers. Kindle may crumble as reported by Jason Perlow. Microsoft will never be a threat to Apple unless it unleashed a serious price war. Doing so would have Apple filing a FTC suit the moment it did so. Zune products starting at $99.00 ? Nahhh....
Google has tentatively settled the book copyright infringement case. Google settled privacy and information sharing in Europe and Canada. It will be distracted for the next month or so in China, maybe longer. Still reeling from poor execution of Buzz and Wave is flat lining. Both have lots and lots of money. Spend it on lawyers?
Financial Comparison of Apple and Google
Apple (furnished by NASDAQ)
| Period Ending: | 9/26/2009 | 9/27/2008 | 9/29/2007 | 9/30/2006 | ||
| Current Assets | ||||||
| Cash and Cash Equivalents | $5,263,000 | $11,875,000 | $9,352,000 | $6,392,000 | ||
| Short Term Investments | $18,201,000 | $12,615,000 | $6,034,000 | $3,718,000 | ||
| Net Receivables | $4,496,000 | $6,151,000 | $4,811,000 | $3,452,000 | ||
| Inventory | $455,000 | $509,000 | $346,000 | $270,000 | ||
| Other Current Assets | $3,140,000 | $3,540,000 | $1,413,000 | $677,000 | ||
| Total Current Assets | $31,555,000 | $34,690,000 | $21,956,000 | $14,509,000 |
| Period Ending: | 12/31/2009 | 12/31/2008 | 12/31/2007 | 12/31/2006 | ||
| Current Assets | ||||||
| Cash and Cash Equivalents | $10,197,588 | $8,656,672 | $6,081,593 | $3,544,671 | ||
| Short Term Investments | $14,287,187 | $7,189,099 | $8,137,020 | $7,699,243 | ||
| Net Receivables | $3,846,121 | $2,928,297 | $2,376,312 | $1,352,053 | ||
| Other Current Assets | $836,062 | $1,404,114 | $694,213 | $443,880 | ||
| Total Current Assets | $29,166,958 | $20,178,182 | $17,289,138 | $13,039,847 |
Information (via NASDAQ)
|
|
|
|
| $209B | $260B | $137B |
David Gewirtz highlights the fact that Apple will control iPad content. Lots of vendors of have similar policies. At least DRM content will be easy to port between a Kindle and a iPad reader, or so we've been lead to believe. Blocked content - drum roll please... maybe an issue for the FTC? If iPad owned 90% of the e-reader market, an investigation would be a no-brainer. Exclusive agreements are legal, just don't tell Jason Perlow that. I noticed that you don't mention a cancellation process for those that pre-order a iPad. With smart phones and laptops that can 'read' books, Apple is again safe from any federal laws. Apple's lawyers could use Steve Ballmer's CNET Conversations interview as part of its defense:
CNET (Fried): Obviously we're asking questions on the Kindle. You know, what about this e-book notion? Is that something that's interesting? Again, that's a market you guys were in. You had Microsoft Reader and protected books for compact devices a long time ago. Is it a market that you think is serious? What's the best device for it?
Ballmer: Obviously the number one reading device on the planet is the PC. The PC has passed print I would say probably. You know, for books probably people still more read on paper. For the things formerly known as newspapers, magazines, people primarily read documents, work documents, homework. People do a lot of reading on the PC screen. And we need to continue to improve the PC as a place to read, including making sure that content types, which are still primarily read on paper, can be read on the PC. And I think we'll see a number of the players who are doing dedicated devices take that as an interesting opportunity.
All three CEO's understand legal warfare and know each other well. Anyone know what happens next? I don't think DOJ, USITC or the FTC are hearing any complaints. Of course, who knew about Intel in advance? Perhaps the boys are dividing up the consumer space while putting on a show to keep the justice department away avoiding big court battles. Is there a future deal in the making that eliminates litigation? Maybe Google strikes a deal to license iPad or Google E-Book App on iPad? Apple would not be too far off the reservation with that concept; after all, Macs run Microsoft Office products - except the iPad which only loads iWork. Apple has room to maneuver and push the limits. Gizmodo published pictures last Friday that suggest Steve Jobs and Eric Schmidt are still willing to have coffee together. I would have loved to have been a fly on the table during that conversation.
Additional resources:
Young Steve Jobs and why 2010 might be like 1984
Five lessons Apple can learn from Amazon
Apple vs HTC: Battle for control of patents, wireless apps - or both?
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Talkback
It's 9% vs. 90%
It's pretty easy to avoid buying or using Apple products.
Too bad I can't say the same for the Wintel Redmond junk.
Really?
You can go and do whatever you want with Linux, so you can get that.
Yeah, really
[i]You can go and do whatever you want with Linux, so you can get that.[/i]
Not in the workplace I can't...
RE: Apple is immune from antitrust
But it would be best if the iPhone is toppled from natural cause in the marketplace, if only to seek that well can be done with form factor and avoid the legal mess. If the gavel swings on Apple, there are quite a few things that would have to be considered in such a judgement... I would HATE to put a Judge in that position.
Immune is the wrong word, try inapplicable.
astute businessman. He learned a long time ago that the
key to success in business is making money, and Apple
decided back in the 80s that the best way for [i]them[/i] to
do it is by making products that have strong desirability
[b]and[/b] high margins. That philosophy got lost when
Jobs was ejected, but it returned when he did. Apple
intentionally doesn't go after controlling market share
(however they [i]do[/i] protect what they consider is their
IP), they endeavor to maximize their profit on each sale.
They do this by making products that look and work in
such a way as to command a premium. Perhaps not from
everyone, but [i]that[/i] is their plan. Apple shoots for the
cream floating on the top, makes a hefty profit [i]there[/i],
and leaves the rest for everyone else. Not only does this
help them avoid a "race to the bottom", but it also gives
them a "get out of Anti-Trust free" card. Like it or not, it's
a very successful, at every level, strategy.
Actually, anti-trust law is very applicable in some areas
It isn't just monopoly type activities that fall under anti-trust law..... it is OTHER activities as well, which some of them both Microsoft and Apple do a heck of a lot.
You forgot...
purchase of AdMob is currently being examined.
Their relationship with Apple with shared board members etc was also
being examined but that is no longer the case.
Any OSX monopoly issues were dealt with in the Psystar case.
Maybe they should look into Adobe's attempts to enforce their
proprietary software onto every Internet accessing device on earth.
Ummm....
True, and that is the type of thing that should go checked.... Considering the size of Google, and the depth of influence it has in the Internet ad market.
> Their relationship with Apple with shared board members etc was also being examined but that is no longer the case.
I wonder if this is still ongoing. It reminds me of the outright FEAR IBM had when there was rumors that the DOJ was going to look into them for monopoly abuse practices.... and the moves IBM made to avoid it.
> Any OSX monopoly issues were dealt with in the Psystar case.
Ummmm, NO! Psystar had alot more to do with licensing termanology than it with monopoly abuse practices for OSX. Psystar tried to make a case based on this, it failed miserably.
> Maybe they should look into Adobe's attempts to enforce their proprietary software onto every Internet accessing device on earth.
No, since Adobe is one... not really trying to force that it's "proprietary software onto every Internet accessing device on earth". And two, it's YET to ABUSE it's monopoly.
As it turns out in US law, you can have monopoly and not be dragged into court, since that happens to be legal. Abusing one's monopoly is not... and that usually when you need the DOJ to step in.
Monopoly is a problem when trade is involved
Apple on the other hand obtaining patents that should not be awarded is coming into someone's legal cross hairs. Specially when the crossed the 200B mark.
Lets wait and see how it plays out.
I don't pretend to be a lawyer of any kind, I base my comments on the fact of how monopoly is defined in the dictionary:
a) Exclusive control of a commodity or service in the market that allows you to dictate prices (wow Apple rings a bell here) .
b) Exclusive control to carry a service, business or traffic in a market (iPad cha ching!)
c) Exclusive possession/control of something. (yeah yeah, you all will say android, but its free so there is no possession or control!, just see how ATT pushed Yahoo and China's Android devices. But Apple's OS?? now we have a winner).
For monopoly to exist some type of commerce and compensation must exists along with the exclusive control of the service or product. When its free, how is that a monopoly??
Apple shares profit with anyone...
70/30 split.
Nokia has more smartphone market share than Apple.
RIM has more smartphone market share than Apple.
You are free to develop your own version of OSX using Darwin.
Google, Nokia and others are free to develop browsers based on
webkit.
I don't understand this psychotic hatred of all things Apple.
Nobody is forced into using [b]ANY[/b] of their products if they don't
want to, the thing is in a free market lots of people are making a
choice to use Apple products and that's their decision to make not
some geeky, disgruntled tech pundit's.
[i]"Any OSX monopoly issues were dealt with in the Psystar case."[/i]
than it with monopoly abuse practices for OSX. Psystar tried to make a
case based on this, it failed miserably."[/i]
To tell the truth, Psystar did try, several times, to claim OS X was a
monopoly, and the argument got thrown out of court every time. So yes,
the precedent is set. OS X won't be a monopoly until Apple holds
Microsoft's share of the computer market.
You said it better than me...
Really?
here? Myself, Apple Counsel and, especially, the US DOJ and FTC would
be very interested in hearing. So, by all means-please enlighten us with
your mastery of US jurisprudence.
Wrong on so many levels
iPhone: THere is no monopoly there, you can buy one of the many
Android based phone. You also have the option to buy a window 7
knock off based phone, when they commie out. That one in a no
brainer, Fail
OS X: This one has potential, but since it is not the dominant OS, you
might have a hard time proving your case. Here?s the rub, the
Playstation 3 OS is limited to the PS3, same goes for the Wii OS and
the box 360, which are limited to the respective consoles. To date
Apple has not used the Embrace, Extend, and Extinguish,as well as
other predatory practices that got Microsoft into hot water. Second
Fail.
Intelectual Property (IP): Apple does nothing that is unusual here. If a
company does not defend it?s patents, the patents become void. So
there is no case here either. the worst one can complain is that the
patent should not have been issued, but the same is probably true of
half of the patents issued to other large companies. The complaint
should be against the system, not the company, This is an Epic Fail.
Sigh. You can't have a monopoly on a product brand.
You post seems to have some vague accusations
[b]Actually, anti-trust law is very applicable in some areas
The iPhone being one of them. OSX being another.[/b]
Specifics please - this is very vague. How does anti-trust law apply to the iPhone and OS X? [b]
It isn't just monopoly type activities that fall under anti-trust law..... it is OTHER activities as well, which some of them both Microsoft and Apple do a heck of a lot. [/b]
What activities? This far this seems to be a bunch of anti-Apple FUD with a bit of anti-MS FUD mixed in...
I have to say.
post like this, when the usual fanboys are ranting and spewing hate. You
bring a breath of fresh air, as well as improve the intelligence level of
this discussion. Well done.
Ballmer: I have a Crystal ball, it's my head!
Gen1. MS CEO Said "Obviously the number one reading
device on the planet is the PC." Come on now , what are you
thinking. When was the last time you read a book on your PC,
never.
RE: PCs
PC ebook reader here
I read books on my PC all of the time. I don't have an ebook reader because they are a cost I'm not willing to spend just to read a book.
The great thing about using a PC to read an Ebook is that I can buy them in any format that I want, and if I don't have the software to read it, I can find software to convert it to something I can read it with.
I've never had any of the problems with eyestrain or headaches or anything like it by reading on my PC. I don't need a light on to read the books. Also, I can use it for more than just an electronic book.
From all of that, I think that the statement probably isn't that far off. PC's are much more versatile and available than any ebook reader. You might want to check into the software that Amazon just released that lets people read Kindle book formats on a PC, obviously people would rather spend their money on something other than a 1 trick pony device.