Apple: Steve Jobs introduces the App Store (2008 video)

“Everything about this video was exceptional at the time, and just as critically, nothing was objectionable.” —Stratechery’s Ben Thompson

From Thompson’s “Apple, Epic, and the App Store,” posted Monday:

While Apple pretends like the Internet never existed as a distribution channel, the truth is it was a channel that wasn’t great for a lot of users: people were scared to install apps, convinced they would mess up their computers, get ripped off, or accidentally install a virus.

The App Store changed all of that: Apple effectively extended the trust it had earned with users over the years to all developers in the App Store. Users could install whatever they wanted, confident the app would not mess up their phone, rip them off, or be a virus… This was the combination of integration and modularity at its absolute best: Apple leveraged its control to create a better market that benefited everyone.

My take: Thompson makes a point succinctly that I’ve been trying to make here for some time…

[T]he question as to what is anticompetitive and what is simply good business changes as a business scales. A small business can generally be as anticompetitive as it wants to be, while a much larger business is much more constrained in how anticompetitively it can act.

He also tells a joke my readers may appreciate:

There is a bit of a running joke in tech that the mainstream media believes that every tech company is ridiculously over-valued right up until the day that the exact same company is a juggernaut that is killing industries; in the case of Apple, the company’s strategy was doomed right up until it was illegal, or so it seems with the App Store.

14 Comments

  1. Fred Stein said:
    Love it. I recommend every startup founder, sales person, watch Steve Jobs communicate. The master.

    @Tim Sweeney, Epic games founder: Apple lets you offer your free version to “every single iPhone user” for “no charge”. From there you get to “set your price.” You can use all of Apple’s tools for “no charge”. (Direct quotes from Steve’s 5 minute pitch.)

    3
    August 17, 2020
  2. John Konopka said:
    Epic is greedy and hypocritical.

    4
    August 17, 2020
  3. Gregg Thurman said:
    The only thing that has changed at the App Store, in the last 12 years, is that developers struggling to make money are now wildly successful.

    This occurred on the back of Apple’s genius, a genius that has yet to be copied. Microsoft hasn’t done it, Google hasn’t done it, Samsung hasn’t done it, and for sure Epic hasn’t done it.

    Obviously, those that are supposed to be victims (consumers) disagree with the regulators.

    4
    August 17, 2020
    • Bart Yee said:
      @Fred Stein Another piece of evidence that shows Apple does not dominate the gaming smartphone market, that developers and users are free to use whatever platform provides what they want, gamewise and smartphone function wise. What others don’t recognize is that the App Store is used precisely because of Apple’s careful curation AND dedication to hardware / software privacy, freedom from malware, and its investments / expenditures to keep it that way – TRUSTED, by millions of iOS users.

      That is not cost free to Apple (although all these entitled developers want it FREE TO THEM so THEY can CHARGE users directly). Apple asks for a return on its investment, has stated that up front, and developers can opt out and go to Android, Sony PS4/5, Microsoft X-Box and other gaming platforms to ply their wares. (and pay similar costs to be there). Apple has always had a deliberate and well thought out business plan, and its success shows it is correct. It isn’t clear if Epic has a well thought out business plan without being able to use the Apple iOS platform. Wonder how they would do if they get banned from iOS entirely because they won’t conform to the rules that everyone uses. Don’t like iOS, create your own hardware platform and App Store. Guess what, the Epic Store has similar costs (taxes) to developers who want exclusivity to the Epic Store.

      Hypocrites.

      1
      August 17, 2020
  4. Fred Stein said:
    Superficially, the App Stores looks like a monopoly but only because they offer consumers and developers the best deal.

    Developers develop on iOS first because it offers the best ROI.

    iOS is a minority platform.

    4
    August 17, 2020
  5. Ralph McDarmont said:
    Steve was brilliant and inspiring in so many ways. Over and over. Just hearing his voice, even after his death, stirs me to work harder and smarter. Maybe I am crazy. I am ok with that.

    3
    August 17, 2020
  6. Dan Scropos said:
    Epic has no mandate forcing them to be in the App Store. If they don’t like the rules, they can simply leave. Much like Shark Tank, you relinquish equity to the Shark because you know it’s an investment that will garner you more than you could alone. Epic will get nowhere near that exposure anywhere else. Epic didn’t invest and scale that—Apple did. Epic didn’t invent the iPhone. Apple did. There’s a *reason* it supports apps. It’s like someone coming into Costco and setting up a table and a Square card reader, and doing business. Then complaining when Costco told them to leave. It’s Costco’s store, they have the right to enforce their rules. Same with Apple. If the vendor doesn’t like it they can leave. (Last analogy taken from Seeking Alpha).

    3
    August 17, 2020
    • John Konopka said:
      This is just like the children’s book about the Little Red Hen. No one wanted to help her grow the grain, harvest the grain, grind it to flour, or bake the bread. But everyone wanted to help eat the bread for free.

      2
      August 17, 2020
  7. Thomas Larkin said:
    I’m curious to what extent Epic’s legal counsel was in the loop on this strategy of break the rules, have your app pulled, then sue and say Apple is starving you to death (BS), or, whether Epic’s legal counsel sent Epic a long CMA letter describing the associated risks. Prior to the litigation Epic was (and still is) party to an agreement that said they could have their game on the app store if they just followed the rules, so why not just fix the app so it’s approved again, to keep the revenues coming in at the previously agreed upon split, while the parties litigate. Otherwise, it seems to me, this is self inflicted harm (and for all the reasons stated this should be an Epic loss for Epic, IMHO). They want a free ride, and the hypocrisy on Epic’s part is what’s Epic.

    1
    August 17, 2020
  8. Jerry Doyle said:
    “…. While the most likely outcome is an Apple victory — the Supreme Court has been pretty consistent in holding that companies do not have a ‘duty to deal’ — every decision the company makes that favors only itself, and not society generally, is an invitation to examine just how important the iPhone is to, well, everything.” Stratechery’s Ben Thompson

    In no article have I read anywhere the belief that Apple in its operation & management of its App Store is doing anything illegally. Is there room for improvement to respond to concerns of Developers who complain? Perhaps, and that process always needs examination. Apple has established an appeals process for Developers who believe they have legitimate complaints relative to Apple’s adverse actions against Developers’ submittal or treatment of apps in the Store. Thompson provides an answer above that little doubt Apple understands fully the need to work closely with Developers, as appropriate, to resolve their issues & concerns while maintaining the integrity of the App Store, but treating Developers’ legitimate complaints in a “fair & equitable” manner.

    It is unfortunate that Tim Sweeney pursues a selfish, self-centered approach as it most likely leads to failure, but perhaps needful scrutiny that may result in an even better process for all as intended by Steve; making the App Store the best deal going to distribute applications to mobile platforms.

    2
    August 17, 2020
    • Kirk DeBernardi said:
      @ Bart Yee —

      Tell it like it is.

      Bravo.

      1
      August 18, 2020

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