Here’s what Britain’s ‘vice-like grip’ guy said about Apple and Google

From his sound-bites in the UK’s Competition and Markets Authority press release:

Andrea Coscelli, Chief Executive of the CMA said:

“Apple and Google have developed a vice-like grip over how we use mobile phones and we’re concerned that it’s causing millions of people across the UK to lose out.”

“Most people know that Apple and Google are the main players when it comes to choosing a phone. But it can be easy to forget that they set all the rules too – from determining which apps are available on their app stores, to making it difficult for us to switch to alternative browsers on our phones. This control can limit innovation and choice, and lead to higher prices – none of which is good news for users.”

“Any intervention must tackle the firms’ substantial market power across the key areas of operating systems, app stores and browsers. We think that the best way to do this is through the Digital Markets Unit when it receives powers from government.”

My take: Mr. Coscelli will have to pry the iPhone from my vice-like death grip before he gets powers over my OS, app store and browser.

22 Comments

  1. Tommo_UK said:
    Classic quango power grab. Won’t go anywhere.

    7
    December 15, 2021
    • Kirk DeBernardi said:
      Forgive my ignorance, but WTF is the “Digital Markets Unit”? A proposed digital market overlord? Oh, that’ll fix (shackle) things proper…government curation.

      “Apple and Google have developed a vice-like grip over how we use mobile phones and we’re concerned that it’s causing millions of people across the UK to lose out.”

      Apple and Google have created (through, I might add, strong competition) an amazing and abundant marketplace marriage of hardware & software propagated by millions of utilitarian apps of every useful resource imaginable that the entire world has directly benefited from with most entry-level marketplace prices based at free.

      Given that —

      “How we use mobile phones…” and “…lose out…”

      Hmmm…sounds more like a personal problem to me, not one of governance.

      1
      December 15, 2021
  2. Chief Coscelli needs to listen to someone besides Tim Sweeney et al. He begs the question when accusing firms of creating a (secure) walled garden in these days of unrestrained ransomware and NSO Group assaults. I believe his logical fallacy is ignoratio elenchi but it may be plain ol’ Argumentum ad Ignorantium.

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    December 15, 2021
  3. Jonny T said:
    Complete and utter baloney.

    3
    December 15, 2021
  4. Tommo_UK said:
    It’s actually a fair and reasonable investigation on the face of it, for someone unaware of the dynamics and evolution of the different OSs, browser wars, and app stores together with security implications.

    Unfortunately it’s just rehashed rubbish given this has had its day in court and with competition authorities all over the world already.

    I’d prefer them to use their time to look into price gouging U.K. and overseas customers, while paying very little tax here thanks to using tax havens like Ireland. Apples enormous profits are considerably assisted by the prices it charges for sales outside of the US and beneficial tax arrangements, which I have very mixed feelings about as a U.K. resident.

    3
    December 15, 2021
    • Tommo, Every nation adds 50 hurdles to the import/export process. The final price is the result of competition in only a few places. Today, an iPhone 13 Pro 256GB costs ₹129990 Indian rupees or $1,700 in Kolkata. That’s $1,700 (boy, the phone vendor would be tickled to get 17 Benjamins). I’m referring to local India cash/credit price. Figure on taxes being added. Tariffs already were added. Apple has added costs to sell in their own shop in Mumbai or keep inventory in Gujarat. Currency exchange, required middlemen and 48 other hurdles face the manufacturer wishing to import anything almost anywhere.
      Same phone is $1,100 or so, after being air freighted and trucked to New Hampshire, include a significant shipping delay for that model right now. It can be as little as a $25/month with some plans. Those plans are not nearly as available to commoners in Kerala. Phone bills are generally lower in India, but more people use each tower & available bandwidth too.
      Some carriers sell the phone cheaper but land someone willing to commit to paying a monthly bill. In many regions, 50% or more of poor regions, smartphone users go with pay per use service. They buy the cheapest phone you’ve never heard of or else used iPhones or Samsungs. “For a small amount more, madam, you can show your friends your iPhone X.”

      2
      December 15, 2021
  5. My, aren’t we off to the races! Up $6 off the day low, $3+ in the last 20 min. Did Chairman Powell effectively advise everyone to sell BAC & find a safer hedge for your cash, investors?

    1
    December 15, 2021
  6. Ken Cheng said:
    “we’re concerned that it’s causing millions of people across the UK to lose out.”
    Okay, prove it.

    “This control can limit innovation and choice, and lead to higher prices”
    Okay, prove it.

    “Any intervention must tackle the firms’ substantial market power across the key areas of operating systems, app stores and browsers.”
    Before we talk about solutions, one must prove the problems.

    One wonders if he’s been spending all of his time talking to Epic and Spotify about their complaints, and less time actually looking at the market and seeing if customers are actually harmed.

    3
    December 15, 2021
    • David Emery said:
      A lot depends on your definition of “the market.” The people who buy cellphones and cellphone apps are a very different market from the people who develop and sell cellphone apps.

      The assertion of “potential consumer harm” is just that, an -assertion-.

      I also wonder what kind of computer he has in his office, and how much he pays to keep that system safe.

      2
      December 15, 2021
    • Bart Yee said:
      Gee, where was the competition committee when Nokia, Ericsson, Siemens and Alcatel ruled the phone industry from Europe? Was it really better that we had 8 different companies (including Motorola, Blackberry, LG, HTC) with 8 different operating systems, differing standards, and conflicting input, display, and internet capability? And remember that aside from Telecoms (mostly in the US) subsidizing phones with long term phone plans, those devices cost $400-$600+ in 2000’s dollars and Euros.

      What happened after the introduction of the iPhone was competition proved which systems were more popular, adopted, and used. iOS and copycat Android eventually became de facto standards because they proved either technically superior or user selected superior. Windows, Symbian, Blackberry, etc. all proved to be inferior from a user’s standpoint or too niche like to survive.

      Today, Android and iPhone users have vastly superior hardware at comparable prices (adjusting for inflation) and vastly superior software experiences and wide price ranges to suit budgets and needs. Users have competitive choices to select from in price, features, options, software settings, etc. If someone else wants to create a new phone OS, have at it. If someone wants to intro a new phone design, have at it. If you can make it better, the marketplace will decide. No one is forced to buy either or both operating systems or devices, or use their app stores.

      3
      December 15, 2021
      • David Emery said:
        It is interesting to consider why most handset makers fell by the wayside. The overwhelming technical superiority of iOS and Android is a big part of the answer. Another part is the handicapping of the phone experience by the Telephone Companies, it took Apple to break that control. (But I do have to give some credit to both Blackberry and to Palm, for at least thinking outside the edges of the box prescribed by the Telcos.)

        Usually, courts will ask “Cui boni?” – Who benefits? – when examining motive. In this case, we need to figure out the opposite Latin phrase, -Who suffers?-, from the effect of government oversight.

        1
        December 15, 2021
  7. Fred Stein said:
    1) It’s not hard to switch browsers. It’s much much harder to switch out Chief CMO’s, or update regulations.
    2) Almost all the Apps I ‘need’ are free, or nearly. The only real money on the Apps stores is entertainment – streaming or in-app games – not essential. It is not too hard to get streaming content from the web without App Stores – legally. Games rely on extensive investments made by Apple on platform technology.
    3) Andrea sees the potential (not actual) abuse by Apple and Google, while failing to see the actual abuse by cyber criminals of all sorts.

    4
    December 15, 2021
  8. Daniel Epstein said:
    As is often the case the short cuts taken by the complainer in describing the “Vice like” hold Google and Apple have on the cell phone market actually are important in mischaracterizing the whole situation and the potential conclusions. The cell phone market devices have a software and hardware component. Many cell phone manufacturers use Google’s Android operating system so is the complaint that the Android operating system is too dominant in its own part of the market? Do we really need many more operating systems to call it competition? He wants another alternative to IOS then as well. The market will adopt if an operating system written by someone else comes along with enough advantages but don’t hold your breath. So we don’t have a Duopoly of manufacturers. The argument fails on hardware.
    On software Google has a Vice like hold on its own operating system but not on the other manufacturers hardware. Apple tightly controls its own operating system and hardware. It competes in the overall market for cell phones but doesn’t offer IOS to others. Who is going to launch another software hardware combo that will gain enough market share to get mentioned as a significant player? They would have to come up with something pretty special. It would most likely be easier and more profitable to make another Android device that has features which excites than to also develop a different operating system. This complaint is that there should be a Tower of Babel situation in the market so let’s make one happen in the name of competition. Good luck with that.

    2
    December 15, 2021
    • Bart Yee said:
      @Daniel “Who is going to launch another software hardware combo that will gain enough market share to get mentioned as a significant player? They would have to come up with something pretty special. It would most likely be easier and more profitable to make another Android device that has features which excites than to also develop a different operating system.”

      Answer #1 – Android Foldable/Flip phones – combined after 2+ years, they’ll sell about 5, maybe 7M units this year, with new models coming from Oppo (but sold in China only for now), TCL, Motorola, Xiaomi, Huawei (not Android). I’m not counting the Microsoft Surface Duo as I believe it to be a drop in the bucket of Foldable Phone sales. This is still very much a small niche (with good revenue but having to pay off the R&D costs).

      Answer #2 – an iOS foldable – of course, not another operating system as it will certainly be iOS based. But an Apple iOS foldable will be a departure from the current hardware/software iPhone combination. Maybe an Apple foldable will get a fork of iOS specifically optimized for it?

      Answer #3 – Apple’s upcoming AR system used as a phone interface. This is the most likely evolution of phone use. I suspect Apple could well disrupt 10-15% of smartphone sales with this device and create yet another option for phone users (hardware wise). Still likely to use an ARK-iOS

      2
      December 15, 2021
      • Daniel Epstein said:
        Bart none of those ideas would change the “Vise like” grip of the Google Apple duopoly that is being complained about. Because the definition they are using would require different operating system and maybe an unknown manufacturer as well. But hey the market might want the products you describe or envision.

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        December 15, 2021

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