FTC to investigate Apple over some of its mobile rules

FTC to investigate Apple over some of its mobile rules
The Federal Trade Commission is planning on taking a long, hard look at some of Apple's business practices. The FTC wants to make sure that the Cupertino based firm is not trying to quash competition in the market for the software used on mobile devices. Before the FTC got to the point of investigating Apple, it had to battle with the Department of Justice over which agency would get the assignment of reviewing complaints by other firms who say they are being locked out of Apple's mobile platform. For example, as we recently reported, Google and its AdMob subsidiary are not allowed to sell ads inside third party apps installed on iOS devices in order not to compete with Apple's own iAd services. In another public dispute, Adobe says it is being shut out from offering its Flash software on Apple's products. While Apple and the FTC both will not comment, the Justice Department is forging ahead with its own investigation of the tech firm's music business. Thanks to the popularity of the iPhone/iPod Touch/iPad, Apple owns 70% of the online music business and controls more of the overall music market than Walmart does. The Department is also gathering evidence on talk that Apple and other computer companies made an informal agreement not to steal each other's employees. If true, that would be illegal. Still, the iPhone manufacturer is not without its fans. "The iPhone was just introduced three years ago, and all of a sudden (Apple is) being accused of being a monopolist? To me, it's absurd," said Gary Shapiro, president of the Consumer Electronics Association, "They don't even have a dominant position in smart phones—that's Blackberry."

The FTC has a head start on examining the mobile ad market as it recently completed an investigation of Google's acquisition of the leader in the industry-AdMob. The rationale for letting the deal go through was the Commission's belief that Apple will become a strong player in mobile advertising. The FTC wrote last month, "Apple not only has extensive relationships with application developers and users, but also is able to offer targeted ads…by leveraging proprietary user data gleaned from users of Apple mobile devices." The FTC added that the company's control over the developer's license agreement (recently changed to lock out Google and AdMob) and its ownership of the iPhone software used to develop mobile ads on its products, "gives Apple the unique ability to define how competition among ad networks on the iPhone will occur and evolve."

Apple iPhone 4 Specifications

source: WSJ



1. JeffdaBeat unregistered

I'm confused as to why folks think the iPhone has to be an open platform for everything. If Apple was blocking things on the web through the Safari Browser then I'd agree. But as far as ads in Apps...I wouldn't want my competition (AdMob vs. iAd) in there at all. Apple should be free to create their phone as they'd like it. And as for Adobe...again, consumers have a choice. It's not like the Windows monopoly years ago...Android is just as powerful and far more open than Apple...if folks don't like the iPhone, they have a very capable alternative...

2. vzwtechbill

Posts: 175; Member since: Mar 16, 2009

I tell people every day that the decisions made by Apple are designed to directly benefit Apple's profitability, which makes great business sense and is good news for investors, not so much for the consumers. If the apps are 3rd party, why should Apple get to say who can advertise in there? They already have so many restrictions in place that makes getting an app approved (after paying for the SDK) a headache. Course, I'm Android all the way, just wish more people realized that the Iphone isn't the only player in the game anymore.

3. pingpong

Posts: 145; Member since: Mar 28, 2010

If you go to Google search and type in "bing" you will see ads from Microsoft for their search engine. Although I do think they make some nice products, Apply has some crappy business practices.

4. JeffdaBeat unregistered

That's fine that Google does that...but Apple not doing it isn't against the law and it's not wrong. It's not Apple's job to promote their competition. If I had a television network, chances are I wouldn't promote another channel's prime time show that is in direct competition with my own. And again, people have a choice. Developers have a choice. Consumers have a choice.

7. wade1968

Posts: 224; Member since: Apr 12, 2010

jeff you can't honestly say a monopoly which is against the law,a monopoly that all mighty apple says they can do over and over again, just look at the history of apple, that charging a cheaper price to lock people to apple devices and making those who chose not to own an apple device but say wants Itunes but have to pay more is every a good thing. look at the history of apple and then look up the word monopoly. apple doesn't compete they tell the customer you don't like it to bad.

8. wade1968

Posts: 224; Member since: Apr 12, 2010

i am with you vzw. i like you are trying every day to make everyone see the truth.

9. JeffdaBeat unregistered

So let me get this straight. You are calling Apple a monopoly, I'm guessing, because they hold a good share of the market of smartphones (even though Blackberry is higher up than them). But what about Google is technically a monopoly having the a lions share of search online...but that's besides the point. Why should Apple allow advertising from a competing advertising company on an Apple handset? Answer for me that question.

10. phonedemocracy

Posts: 98; Member since: Sep 30, 2009

If you had a television program, and a company paid your advertising fees to put a commercial for your prime time rival up, it would be illegal for you to just say no for the profit of your company.

11. wade1968

Posts: 224; Member since: Apr 12, 2010

jeff you need to learn more about google. google doesnt block no ads or browsers on the android platform that are 3rd party like opera telling them what they can and cant have on their browser for advitising but apple does. and from what i have seen of google and heard they dont want to be just a standard on anything they do, they want to be what everyone strives to be. i do understand that companys need to make profits but government keep sueing apply or the law and after all these years i would think that apple would go hey maybe they are right but they dont, and like all big giant dinosaur companys they are gonna keep doing what ever they want till the customers stop buying things that they dont believe in like steping on the little guy trying to make some money or the little company trying to compete. google is so far going beyond apple and what they make and they do it by being open and bring in those striving to make a better company.

13. deago78

Posts: 170; Member since: Oct 08, 2009

That was nearly impossible to read...

5. Whateverman

Posts: 3295; Member since: May 17, 2009

Apple has every right to make their devices the way they want them. But Apple takes it to far by blocking some software and promoting others. EX: Bad-mothing flash and selling the case for HTML5. Why block it from your devices if it's available? And remember when Apple kept updating iTunes to stop it from syncing with Palm Pres? Why were they alienating iTunes users who didn't buy an iPhone? Maybe these people wanted iPhone but dont get Att service in their area. But Apple didn't consider nor did they care about thes users. All they They were terrified of losing their market share to the next big thing, even though the Pre never lived up to the hype. If these software and ad companies are willing to provide content to your customers and the company just blocks it, that almost seems like a form of censorship. And for the record, I see plenty of Apple products advertised on my Droid.

6. WnnaFghtAboutIt

Posts: 149; Member since: Aug 31, 2009

just toss some ridiculous fines at them, they'll appeal for 6 years...blah blah blah.... eff apple

12. wade1968

Posts: 224; Member since: Apr 12, 2010

fines dont work they just pay them then move the prices up on whatever they make and that doesnt hurt a company at all.

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