When Apple v. Pepper goes to trial, Apple likely to win

So say Gene Munster and Apple. But they’ve been wrong before.


Excerpts from notes and commentary that landed on my desktop. More as they come in.

Gene Munster, Loup Ventures: Apple v. Pepper Opens Door for a Lawsuit That Apple Will Likely Win. We do not believe Apple is engaging in anticompetitive behavior. We see the necessity for Apple to charge developers to operate and maintain a platform and ecosystem. The benefits of a single party operating that platform for developers and, ultimately, consumers, include trust, safety, security, curation, and access to customers.

Apple Public Relations: Today’s decision means plaintiffs can proceed with their case in District court. We’re confident we will prevail when the facts are presented and that the App Store is not a monopoly by any metric… Developers set the price they want to charge for their app and Apple has no role in that.  The vast majority of apps on the App Store are free and Apple gets nothing from them. The only instance where Apple shares in revenue is if the developer chooses to sell digital services through the App Store.

Justice Brett Kavanaugh: If accepted, Apple’s theory would provide a road map for monopolistic retailers to structure transactions with manufacturers or suppliers so as to evade antitrust claims by consumers and thereby thwart effective antitrust enforcement.

Eriq Gardner, Hollywood Reporter: How Apple’s Loss at Supreme Court Could Impact Entertainment. Buying an app at the iTunes store may be analogous to using Ticketmaster to purchase access to a live concert. Thus, the high court’s decision on who can sue over antitrust injury could become impactful in different contexts.

Ashley Gold and Christopher Stern, The Information: Apple’s Grip on Apps Faces Challenge From Supreme Court Ruling. Other tech companies that, like Apple with its App store, serve as platforms for selling services  should be a ‘little bit spooked, said [Sally Hubbard, director of enforcement strategy at Open Markets]. The ruling should also be a wake-up call for the Justice Department, which filed a brief in support of Apple, that it was on the wrong side of a Supreme Court case, she added.

Adam Liptak and Jack Nicas, New York Times: Supreme Court Allows Antitrust Lawsuit Against Apple to Proceed. The court’s 5-to-4 vote featured an unusual alignment of justices, with President Trump’s two appointees on opposite sides. Justice Brett M. Kavanaugh, who joined the court in October, wrote the majority opinion, which was also signed by the court’s four more liberal justices. Justice Neil M. Gorsuch, who joined the court in 2017, wrote the dissent.

Noah Feldman, Bloomberg Opinion: Kavanaugh Takes a Shot at Apple, and Big Tech Should Take Note. To grasp the significance, you have to realize that under Supreme Court precedent, the suit against Apple could reasonably have come out either way… The underlying ideological issue is how difficult or easy the court should make it to sue Apple. And that’s why Kavanaugh’s surprise vote matters going forward. His vote signals that in potential future cases, he won’t reflexively go with the conservative impulse to make it harder to sue big companies over antitrust issues.

My take: Apple insists it is not a monopoly “by any metric,” but isn’t every platform a monopoly in its own domain?

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