DOJ vs. Apple is a Bad Idea

I’ll open with a caveat. This is, unfortunately, how the United States does regulation now — settlements and consent decrees in response to broad, annoying lawsuits. I wish it wasn’t that way, but Congress is full of too many old, stupid, unserious people to keep up with most of the issues you encounter in everyday life, so this is what we get. And if the DOJ is basically just making the biggest, dumbest, most inflammatory lawsuit they can come up with so they can cut a deal with Apple to get what they want, I get it. I’m turning 42 next week, I understand at this point how the sausage is made.

That being said, on its face, this is a stupid lawsuit with a lot of stupid arguments in it, and I’m not even sure what the DOJ wants. A truly bizarre part of Apple’s appeal — something that was very much not the case back in the 80s and 90s — is that it has very successfully aligned its massive size and weight against a number of the most annoying factors facing consumers. In other words, Apple has used the fact that the phone is everywhere as a cudgel to make elements of life work more the way many (not all, but most) of their users want it to, and it’s a huge part of what helped Apple go from “very large tech company” to “the tech company that we give all of our money to”. And yet, somehow tech-people seem to forget this.

One of the things you’ll notice in both the coverage and the filings itself is a surprising conflation of consumers, third-parties, and developers. The average American is a consumer, but the average American is NOT a third-party corporation participating in one of Apple’s many lucrative value chains, nor are they a developer trying to make money from the iOS App Store. Regardless, developer harm is frequently lumped in with consumer harm, so Citibank (not a literal example, sorry guys) not getting to make their app the way they want is assumed to be simple rent-seeking from Apple.

Except… in real life, do Apple’s customers want Citibank (again, sorry) to make their app the way they want? Do they want Ticketmaster to make their app work the way they want? Absolutely not!

What the DOJ doesn’t get — and many, many tech dorks with brains forged in the fires of 90s WinTel culture do not get — is that back in the 1990s, Microsoft aligned itself against things that would cost it money, which usually meant things that threatened its ubiquity. Apple figured out a way to make money by aligning itself against things that most people absolutely hate, many of which are either failings of or representative of the tech industry. Standards that don’t work in practice, endless attempts to track and monetize your data, UI conventions that are different for no reason, and incompetent data security are all everyday irritants that people suffered through every five minutes on their Windows XP laptop, before Benevolent Dictator Apple swept in and started banning things.

DOJ sees those “things” and thinks — aha! These are vectors to compete with Apple! And… they probably are. But they were vectors to compete in 1998, and 2005, and honestly the only thing companies competed over more was who could make the shittiest, cheapest implementation of everything.

Think of it this way. In many cases, less zealous anti-trust people than I often make arguments to me about the benefits of things like vertical integration and the potential benefits of something large if that large something acts as a check on something else. Most of the time, my opinion is that these benefits don’t pan out. Again, Ticketmaster/Live Nation, etc., etc., and so forth.

DOJ is going after maybe the ONE major, well-known example of vertical integration creating customer satisfaction and loyalty. There are soooo many places you could go after — grocery stores, telecom, banks, credit cards, and more — and you’re going after the iPhone. The most popular, successful, influential, beloved consumer product in the last fifty years (maybe longer), and one that people don’t even have to buy because Android is the most popular phone platform in the world and has absolutely nothing to do with Apple.

There are lots and lots of things Apple needs to improve. The DOJ is not going after the right ones, and even if it did, mandating them by government fiat is going to be an exercise in incompetence and futility. Apple needs to be pushed by competition. That competition isn’t prevented by Apple Watches not working with Android phones — it’s prevented by the fact that Android just isn’t what most iPhone users want, and Microsoft threw their hands in the air and gave up.