An Entrepreneur’s Take on the Apple Lawsuit
It’s been a few months since the news broke out about the DOJ’s lawsuit against Apple. Now that some of the initial hype has calmed down, let’s hear Matt’s opinion on the whole thing.
There are tons of people out on social media giving business advice. Some of it is good advice, but most of it isn’t good. In this series watch CapForge’s owner react to different advice videos. He’s an expert in all things business and has 20+ years of experience under his belt. Some of the things he reacts to might even surprise you!
Video Transcript:
Business Advice Video:
Apple is being sued by the Department of Justice for an alleged monopoly over smartphones.
Let me explain. On Thursday [Thursday, Mar 21, 2024] the Justice Department announced the landmark antitrust lawsuit against Apple, in which the Biden administration and 16 states alleged Apple is illegally abusing the iPhone’s monopoly power in the smartphone market. The DOJ claims Apple has maintained an illegal monopoly over the smartphone market by locking in customers and making experiences worse for rival products. This means Apple makes their services like Apple Pay Air Tags and Apple Watch a much more seamless experience on an iPhone than their competitor services like Google Pay, Tile Trackers, and other smartwatches. Apple allows iPhone customers to send high-quality photos and videos seamlessly to one another, but multimedia text Android phones are slower and grainy. The company late last year
relented and agreed to improve the quality standard it uses to interact with Android phones
via text message but it still maintains those messages in green bubbles. Some critics argue
these green bubbles create a class divide. The lawsuit also critiques Apple’s App Store and its operating system code. Apple forces app developers to write codes specifically for its operating system restricting developers from coding using universal languages that could offer a single app experience across any device.
Matt:
Okay, I think that this is kind of ridiculous. I think it’s a politically motivated move to try to pander to the idea that Big Tech is not paying its fair share of taxes, and is somehow making money unfairly from the general population, and it’s an attack for political reasons. There is absolutely competition for Apple phones. I have one myself. I have a Samsung phone and it uses Google’s operating system and with Verizon. And there’s lots of other phone options that aren’t Apple. You don’t have to have an Apple phone in this world to get along, take high-resolution pictures,
and share things with other people. Of course, Apple wants to make their experience the best possible. And of course, they want you to have an Apple Watch and Air tag and use everything else Apple. That’s their business. Everyone else is doing exactly the same thing. Google would love you to have a Google Phone and use everything Google and never even know Apple exist. There’s competition all over the place.
And there’s times when some businesses sort of rise to the top and become the preeminent player, but sooner or later if they’re not meeting market demands, if their products aren’t the best anymore, they’re not working seamlessly, they’re not priced you know competitively, then competition comes in and starts to take away market share and then that top player either improves or they buy the competition or they lose out and shrink over time, right? At one point Kodak was one of the most profitable, most successful companies in the country, and guess what, they’re barely alive now. Because digital cameras came in and replaced you know regular cameras and took away the need for having film which was the most profitable part of Kodak’s business. So you could have sued Kodak back in 1980 and said, “You’re too dominant you know other camera people can’t compete and it’s not fair and you’re encouraging everyone to use Kodak products”. But you didn’t need to do that because digital cameras came along from all kinds of different people and took the business away and chipped away at Kodak. And Kodak didn’t – they could have gotten into the digital camera business but they didn’t until it was much too late.
This is just the natural ebb and flow of competition in business and I think trying to put handcuffs on Apple is unnecessary and unfair, right? If they’re doing things to encourage people to do business with them then that’s what you would expect them to do. And if the competition can’t beat them by creating better products and better ecosystems of products better experiences then they have to keep trying harder. As long as Apple’s not allowing people to have alternate phones, which they’re certainly not, then I don’t think they need any more handicapping or restrictions on how they do business. It’s up to the competition to give people a reason to pick something besides what Apple’s offering and there are certainly lots of people who are doing that and winning lots of market share with it. So I think this is a politically motivated thing. I don’t think it’s helping the consumer I don’t think we’re getting screwed over by Apple. If you don’t like Apple don’t buy an Apple phone, right? It’s pretty straightforward. There’s a bazillion apps in Google Play Store and all kinds of other stuff you could use in lieu of what Apple has going. So this claim that they’re a monopoly and they’re you know holding everyone else back I just, I don’t think it’s accurate at all.
