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Apple is being sued for its App Store walled garden; ruling could have severe implications for gaming consoles

Oct 27, 2017
8,623
UK
This can only be good for customers.
You really think Sony would be investing the money they currently invest in first party without the walled garden? First party is a Trojan horse to get you in the walled garden. And whilst you're in that walled garden not only does Sony get a cut on literally everything, but they also enjoy the revenue from your PSN, PS Now and Vue subscriptions.
 
Feb 6, 2019
403
When you become so large and integrated, it doesn't matter if it's their platform. Amazon for instance has 50+% of all online business. The next closest is 6% on eBay. Are you saying they are out of reach for monopolistic related charges because it was their own platform? Scale matters.
Yes but, still not the same, apple is not offering a service, the whole medium (Os and devices) is theirs, so they can choose how people would get thinkgs in it (appa) legally (cause there is always jailbreaking/ hacking option but that is beyond the point).

Also look at steam and PC, devs can easily get games to Pc by any other channel, but they all stick to Steam cause they individually lack the resources and mass dostrobution and exposition, same will be the app store, to me it just spunds like some body is trying to armbend apple to remove the 30% cut
 
Oct 27, 2017
85
It's a complicated holding (in implication if not design), and not one that I feel breaks down terribly easily over ideological lines. Kavanaugh is clearly interested in an expansive reading of the Sherman act, but I certainly question some of his economic hypotheticals. It *is* an important case, though, and so I decided to do a reading (of the highlights) in Virtual Legality. Check it out!

 
Oct 25, 2017
3,527
https://en.wikipedia.org/wiki/United_States_v._Microsoft_Corp.

The plaintiffs alleged that Microsoft had abused monopoly power on Intel-based personal computers in its handling of operating system and web browser integration. The issue central to the case was whether Microsoft was allowed to bundle its flagship Internet Explorer (IE) web browser software with its Windows operating system. Bundling them is alleged to have been responsible for Microsoft's victory in the browser wars as every Windows user had a copy of IE. It was further alleged that this restricted the market for competing web browsers (such as Netscape Navigator or Opera), since it typically took a while to download or purchase such software at a store. Underlying these disputes were questions over whether Microsoft had manipulated its application programming interfaces to favor IE over third-party web browsers, Microsoft's conduct in forming restrictive licensing agreements with original equipment manufacturers (OEMs), and Microsoft's intent in its course of conduct.

Microsoft stated that the merging of Windows and IE was the result of innovation and competition, that the two were now the same product and inextricably linked, and that consumers were receiving the benefits of IE free. Opponents countered that IE was still a separate product which did not need to be tied to Windows, since a separate version of IE was available for Mac OS. They also asserted that IE was not really free because its development and marketing costs may have inflated the price of Windows.

The case was tried before Judge Thomas Penfield Jackson in the United States District Court for the District of Columbia. The DOJ was initially represented by David Boies. Compared to the European Decision against Microsoft, the DOJ case is focused less on interoperability and more on predatory strategies and market barriers to entry
 
Oct 27, 2017
2,317
The court did not rule in favour of a closed garden in the Tengen suit back in the 80s. Tengen lost because they stole the code Nintendo had made, so they could bypass the lockout chip.

So Tengen didn’t lose the case to release their own cartridges, they lost the case because how they did it and used copyrighted materials.
Yep, this "walled garden" on consoles since then has been because of third parties accepting it, not because they're legally forced. Unlicensed console games continued to exist for years. In the current internet connected console age, a first-party can just update the firmware to keep unlicensed games out anyway.
 
Oct 28, 2017
68
How is this any different from say, a supermarket? Are supermarkets not supposed to take a cut from their sales? Are they supposed to build, maintain, and support their marketplace just for the good of the manufactures and buyers?
Supermarkets purchase their goods on the wholesale level to sell to their customers, completely different model of sales
 

TRU

Member
Nov 9, 2017
254
To me people need to understand convenience comes at a co$t. All these people on here posting this is great news need to take a step back and think what would they do w/o these things?

If Apple tomorrow says “sorry we are shutting down the app store immediately and will await a competitor to come in and not make this a monopoly on our platform. We expect this to occur anywhere between 6-18 months”

People would be flipping the fuck out if their apps went away on their Iphones and couldn’t get anymore. Same goes for Xbox, PS4, etc.. Yes they take a cut, maybe too much, but how many companies can make it work as well as it currently does? Specifically in regards to security, reliability, server scale etc..

Ive owned Apple before Ipods, and ALWAYS paid more for their products because they worked better. Sure I could have bought a virus infested windows pc in early 2000’s but I paid $300-$400 more for a better product. App store to me is no different. I will always pay a premium price for a better product. I don’t want a future where Im relying on Vizio or Hisense to run their own App store. As a consumer their system is not a problem for me and don’t have an issue for them taking money in exchange for the Billions in infrastructure they have invested in vs zero money investment in Apples infrastructure that none of these App creators have put into it.
 
May 8, 2018
1,282
User Warned: Antagonistic Generalization
Era is conflicted. On one hand they want to continuously shit on Apple but on the other hand their precious Sony, Microsoft and Nintendo are at risk.
 
Oct 25, 2017
4,514
How is this any different from say, a supermarket? Are supermarkets not supposed to take a cut from their sales? Are they supposed to build, maintain, and support their marketplace just for the good of the manufactures and buyers?
how it is it anything like a supermarket? this is an antitrust suit. the allegation isn't that running a store is illegal, it's that the app store is an illegal monopoly.

Of course a store has the right to take a cut because it costs money to run a store. However, when there is only one store and all sales must run through it, the mandatory 30% cut likely does raise prices for consumers. 30% is higher than the cost of maintaining the store. If other stores could exist, you could see places trying to compete by taking a smaller percentage of the sale price or developers avoiding the fee entirely by directly selling to the consumer.
 
Oct 25, 2017
1,809
Nintendo may manage to sidestep this since they’re a gaming only single purpose device. The PS4 and Xbox One being “all in one entertainment” devices may mean they fall under the purview of this ruling, should it happen.
If that's the case then Sony and MS will respond by removing those features from their consoles. Which would be overall a net negative for the consumers.
 
Oct 25, 2017
3,527
how it is it anything like a supermarket? this is an antitrust suit. the allegation isn't that running a store is illegal, it's that the app store is an illegal monopoly.

Of course a store has the right to take a cut because it costs money to run a store. However, when there is only one store and all sales must run through it, the mandatory 30% cut likely does raise prices for consumers. 30% is higher than the cost of maintaining the store. If other stores could exist, you could see places trying to compete by taking a smaller percentage of the sale price or developers avoiding the fee entirely by directly selling to the consumer.
Generally, I struggle to find where some costs are being passed on to the consumer. Most games on iOS and Android are incredibly cheap or free to play, because you kind of have to be in order to be competitive or even be considered. A result of the race to the bottom mentality many companies instilled in their customers (Apple included). We more usually see the price of a game that was on iOS and Android go up a bit when ported to consoles and PC.
 
Oct 28, 2017
1,103
You should probably start, this isn't healthy, it also has literally nothing to do with this topic right now lol



Windows has run afoul of stuff like this before, mainly preinstalled apps (I recall there being a big thing about Internet Explorer in the EU)



Admittedly not that simple, this was a thing years ago with Cydia/etc but that has stopped
Actually it’s still going unless I’m misunderstanding you. You can get Cydia impactor (does it in the same way as XCode) on Windows or Mac and sideload any app you want at all on an iOS device, for 7 days. It’s supposed to be used for devs so they can test their apps out on their devices with XCode. That’s also how jailbreaking works today, sideload an app and then that allows unsigned code to run through exploits.
 

BronsonLee

it me
Member
Oct 24, 2017
14,136
Actually it’s still going unless I’m misunderstanding you. You can get Cydia impactor (does it in the same way as XCode) on Windows or Mac and sideload any app you want at all on an iOS device, for 7 days. It’s supposed to be used for devs so they can test their apps out on their devices with XCode. That’s also how jailbreaking works today, sideload an app and then that allows unsigned code to run through exploits.
Cydia used to be waaaaaaaaay more prevalent
 
Jul 30, 2018
2,116
United States
I don’t think the walled garden is gonna come to an end anytime soon. Apple is being shitty trying to use the Illinois Brick case as a “get-out-of-jail-free card” but I think just letting customers sue Apple directly is gonna be the outcome.

Edit: WIRED has a pretty good write up of the case as well. It seems like the biggest effect it could have on the game’s industry is the lowering of the 30% cut. Anything else seems a little far fetched IMO.

Edit 2: Also Sony (not sure about Microsoft or Nintendo) aren’t like Apple, charging services like Netflix & Hulu 30% for being on PSN.

https://www.google.com/url?sa=i&source=web&cd=&ved=2ahUKEwjGiNHv5JniAhWY4J4KHeMuAUIQzPwBegQIARAC&url=https://www.slashgear.com/playstation-4-cuts-fees-for-online-services-netflix-hulu-chat-included-29292099/&psig=AOvVaw2V3Vqrc9dmGghCEHTzdIWo&ust=1557880936060075
 
Last edited:
Oct 27, 2017
3,613
Pretty much nothing is going to come of this gaming wise.

Even the OP headline is pretty misleading. They aren't being sued because it's a walled garden. They are being sued because Apple is trying to avoid responsibility to consumers by claiming they are just a middleman. The walled garden opening up is one of a handful of proposed solutions talking heads are offering to this, but it hardly likely and certainly should not be the main takeaway here,
 
Dec 15, 2017
525
I feel like Nintendo relies more on the licensing fee than Sony or MS so this would be a huge issue for them. I wonder how they'll react if this happens.
They don't. IIRC, 85% of their software revenue was their own software.
This has much stronger implications for Playstation and Xbox.
 
Jan 15, 2018
827
Valve doesn't have to R&D and support console hardware. No sense in making the console market barely profitable.
Fair enough. I didn’t think of that but then Valve doesn’t charge monthly amounts for online play. It’s all swings and roundabouts.
 
Nov 6, 2017
834
It's not so much that PC isn't open platform. That was probably a bad answer.

The difference is because you can buy steam products from a number of different retailers and trade them privately.

Meanwhile epic is making efforts to be the only destination for some products. Driving up the prices, stifling competition.
I don't really agree that Steam is friendly to competition, because a lot of their stuff in that area is designed to funnel people into the Steam ecosystem anyway

But that's another can of worms, I guess
 
Oct 25, 2017
3,887
The ruling doesn't have anything to do with the legality of a walled garden.

Apple was trying to say "We're just the middleman, you can't sue us for this kind of thing."

The court said "Bullshit. Look at the level of control you take over distribution channels and the financial stake you claim over all sales. It's your responsibility too, not just the creators."
 
Oct 25, 2017
3,887
I don't really agree that Steam is friendly to competition, because a lot of their stuff in that area is designed to funnel people into the Steam ecosystem anyway

But that's another can of worms, I guess
Valve doesn't force you to use the steam launcher or overlay - you can disable it on a per-game level. Steam keys bought through Steam/Valve are treated the same as keys bought through 3rd party sellers. They provide Steam key generation for free, in fact.

Companies gravitate towards Steam because it provides key generation as a built in service. As well as DRM. As well as achievements. As well as controller integration. As well as support for Linux and Mac platforms. As well as streaming. As well as cloud features. As well as workshop. It's convenient for them, and it's convenient for consumers, and users are free to leverage these features without giving Valve a dime.
 
May 13, 2019
2
This is an interesting "what if" scenario.

However good as it sounds for customers, I still think the big Platform Holders like Microsoft, Apple, Sony, Nintendo etc. will likely find a way to get the money stream from other sources. If there are less money to be made from selling games in their store front, they might shift the focus on selling games and push a subscription model even harder.

This is why I think Google and Microsoft (maybe Apple too someday) are betting on the streaming future. The 30% cuts would be a huge loss for the platform holders. I don't think peoples at those large companies do not have contingency plans.

Hey... this is a "what if" scenario anyway lol.
 
Oct 25, 2017
6,349
no
I'd actually be kind of happy about this, but...

Reading Kavanaugh makes me sick.
...There's no way there isn't some major caveat here. He's enough of a slimeball that I'm willing to bet he takes corporate money. I'm sure he's just posturing to scare Apple into paying out more.
 
Oct 26, 2017
8,615
I don't really agree that Steam is friendly to competition, because a lot of their stuff in that area is designed to funnel people into the Steam ecosystem anyway

But that's another can of worms, I guess
But you see why valve would not have to worry about an action such as this. They are definitely not trying to play keep-away and price fix.
 
Nov 6, 2017
834
Valve doesn't force you to use the steam launcher or overlay - you can disable it on a per-game level. Steam keys bought through Steam/Valve are treated the same as keys bought through 3rd party sellers. They provide Steam key generation for free, in fact.

Companies gravitate towards Steam because it provides key generation as a built in service. As well as DRM. As well as achievements. As well as controller integration. As well as support for Linux and Mac platforms. As well as streaming. As well as cloud features. As well as workshop. It's convenient for them, and it's convenient for consumers, and users are free to leverage these features without giving Valve a dime.
That doesn't change the fact that continued access to your library is dependent on Steam's continued success, and that we exist in an environment where if you want your game to be anything approaching a success outside of consoles, your two choices are to either make an exclusive deal with a company that may or may not want to have anything to do with you or go to Steam. Two companies. Two companies wielding unparallel power and influence on a marketplace, to the point that when you buy at another store, you're still basically buying through Steam.

And if you ever make a personal business decision to move away from Valve or become dissatisfied with their business tactics, you have limited alternative options for most games, and even if you buy from a third party seller, you're still contributing to Valve's metrics and number of active users, which benefits them financially. And you don't have any control over the titles you DO own because they're still bound to Steam and Valve's discretion, even if you disable the launcher and overlay.

It's not by any means the only company with problems or even necessarily the most problematic, but let's not claim that Valve is without them.
 
Oct 25, 2017
1,910
So, I need to ask the dumb question here....where else would you get apps on your phone?
Fortnite on Android must be downloaded from Epic's website.
edit: I wonder if EA Acess gives Microsoft and Sony a loophole here?
No. EA Access is not a separate service from PSN or Live, it's a product offered by them. It just activates a time limited license to let you play EA games using the console's own DRM and lets your PSN/Xbox account buy select stuff for 10% off on PS Store and Xbox store.
 
Nov 15, 2017
353
Won't this also affect steam/origin/egs etc?

They might not be a bad as Apple, but a lot of games are "exclusive" to those launchers
 

ColdSun

☠️ Astra inclinant, sed non obligant. ☠️
Moderator
Oct 25, 2017
529
Won't this also affect steam/origin/egs etc?

They might not be a bad as Apple, but a lot of games are "exclusive" to those launchers
No, it won't impact those stores. The platform isn't a monopoly. The PC platform is open and develoeprs can release their titles on the hardware through any means they decide.
 
Oct 25, 2017
3,527
Laptops are also expensive because Lenovo’s business model is to make the bulk of their money on hardware, unlike Nintendo.
???

Nintendo is one of the more consistent companies that launches their systems at a profit to make money back day 1. Up until recently, the other hardware manufacturers would launch and sell their hardware at a loss, and have software make up for it (at least I think PS4 and XBO were sold at a profit? someone can hopefully fact check me). It's also what made the whole talk of two systems vs hybrid system such a hot topic before the Switch came out because they would be halving what they traditionally earn. Nintendo relies heavily on hardware sales just as they do software, and they also need software to sell their hardware.
 
Oct 25, 2017
5,850
???

Nintendo is one of the more consistent companies that launches their systems at a profit to make money back day 1. Up until recently, the other hardware manufacturers would launch and sell their hardware at a loss, and have software make up for it (at least I think PS4 and XBO were sold at a profit? someone can hopefully fact check me). It's also what made the whole talk of two systems vs hybrid system such a hot topic before the Switch came out because they would be halving what they traditionally earn. Nintendo relies heavily on hardware sales just as they do software, and they also need software to sell their hardware.
I like how you took a meme about loss leading to conflate that with whether or not the bulk of profits are software or hardware. Total revenues for Switch are almost equal between hardware and software (software being a bit higher). What do you think has a higher profit margin, hardware or software? Compare that with Lenovo.
 
Nov 28, 2017
193
As I understand it, there are really no similarities between the Apple case and consoles.
This lawsuit, and the one Spotify started against Apple in the EU, basically complains about the Apple store purchases being the only way to install use any app on Apple phones.
But, if you want to install and use games on the consoles, you are not limited to obligatory purchases on the PSN/XBox stores. You can buy a physical disc from numerous retailers, and if you wish to own a digital game, there are outlets which will sell them to you (as a code) if you want to avoid using a console store.

Similar to Google and Android sideloading .apk files which you can download directly from creator's websites. Spotify sued Apple because the only way you can subscribe to it on the iPhone is to give Apple 30% of the subscription. On Android, you can bypass the Google store and Spotify gets 100% of subscription money.
 
Oct 25, 2017
5,850
As I understand it, there are really no similarities between the Apple case and consoles.
This lawsuit, and the one Spotify started against Apple in the EU, basically complains about the Apple store purchases being the only way to install use any app on Apple phones.
But, if you want to install and use games on the consoles, you are not limited to obligatory purchases on the PSN/XBox stores. You can buy a physical disc from numerous retailers, and if you wish to own a digital game, there are outlets which will sell them to you (as a code) if you want to avoid using a console store.

Similar to Google and Android sideloading .apk files which you can download directly from creator's websites. Spotify sued Apple because the only way you can subscribe to it on the iPhone is to give Apple 30% of the subscription. On Android, you can bypass the Google store and Spotify gets 100% of subscription money.
Console makers still get a cut from retail sales similar to how they get a cut from digital sales. You can't sideload a game onto Switch that hasn't been approved by Nintendo and with portion of the sale gone to Nintendo, like you can android where you can find some random APK made by whoever and just install it directly.
 
Oct 27, 2017
1,076
This could potentially lead to the end of first-party titles in video game consoles. In an extreme scenario, Sony, Nintendo and Microsoft would need to spin-off their software development business into separate companies. I'm not sure I want this.
 
Nov 28, 2017
193
Console makers still get a cut from retail sales similar to how they get a cut from digital sales. You can't sideload a game onto Switch that hasn't been approved by Nintendo and with portion of the sale gone to Nintendo, like you can android where you can find some random APK made by whoever and just install it directly.
Yes, you are correct.
I realized that shortly after posting, but I think there is no option to delete the post.
 

Raging Spaniard

Artist at EA Star Wars
Verified
Oct 25, 2017
1,430
Steam was initially marketed as “its digital so the money we save on not manufacturing DVDs will be reflected in the games price”

That, of course, was bullshit. Game prices stayed the same and the extra profit went to the dev.

Here it would be the same, if I dont have to give apple an extra 30% then that is fucking SWEET and Im pocketing the extra $$$, it just makes sense.