Spotify, Rdio, Pandora and certainly others that I haven't heard of are all competing for a spot on iOS while Apple's Music software is both bundled and cannot be uninstalled. Are there parallels here to Microsoft and Internet Explorer? Is there something I am missing otherwise?
Asked
Active
Viewed 337 times
2 Answers
4
In United States v. Microsoft, Microsoft was accused of abusing its monopoly power by bundling. A prerequisite for this type of Sherman Act Section 2 claim is that the company must have monopoly power to abuse.
Market share is one of the primary measures courts use to determine if a company has monopoly powers, and therefore can be punished for abusing them. At the time of the Microsoft case, its market share was over 80% of all PCs and over 95% of Intel PCs.
In United States v. Alcoa, 148 F.2d 416, Learned Hand considered three possible market share numbers. He wrote that market share of more than 90% "is enough to constitute a monopoly; it is doubtful whether sixty or sixty-four percent would be enough; and certainly thirty-three per cent is not."
Worldwide, iOS has about 15% of the smartphone OS market. In the US, it's about 40%. According to Judge Hand, that's well below "doubtful" and awfully close to "certainly not" a monopoly.
No monopoly equals no monopoly power equals no Sherman Act Section 2 violation.
chapka
- 5,841
- 20
- 23
1
These competitors typically give away their applications for free, and sell paid memberships either through App Store purchases, or through their websites. The terms and conditions these competitors receive are the exact same ones that any other distributor of applications through the App Store gets.
These competitors can instead sell paid memberships exclusively through their website, let Apple pay for the cost of distributing their free applications, and pay not a penny to Apple. If they chose not to do so, that's their problem.
gnasher729
- 35,915
- 2
- 51
- 94