Linked by Eugenia Loli on Fri 24th Jul 2009 22:52 UTC
Editorial Every few years we geeks have our own kind of popcorn show to watch: tech companies showing teeth to one another. This time around, it's Palm vs Apple. In all seriousness though, how ethical is the battle around iTunes?
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RE: Monopoly?
by sbergman27 on Sat 25th Jul 2009 16:04 UTC in reply to "Monopoly?"
sbergman27
Member since:
2005-07-24

The author of the article misunderstands what monopoly means. He conflates monopoly with being a major success.

If that major success creates a substantial barrier to entry for other potential players, as iTunes arguably does, then it is a monopoly. And using that monopoly to leverage another of their products is quite clearly a fundamental violation of anti-trust laws.

Somehow, some people seem to operate under the misconception that to be a monopoly you've got to have 100% of the market, and own all the pipes that deliver the gas, or all the wires that deliver the electricity. It's all about barriers to entry, no matter what form those barriers might take.

Edited 2009-07-25 16:04 UTC

Reply Parent Score: 3

RE[2]: Monopoly?
by mkone on Sun 26th Jul 2009 14:18 in reply to "RE: Monopoly?"
mkone Member since:
2006-03-14

"The author of the article misunderstands what monopoly means. He conflates monopoly with being a major success.

If that major success creates a substantial barrier to entry for other potential players, as iTunes arguably does, then it is a monopoly. And using that monopoly to leverage another of their products is quite clearly a fundamental violation of anti-trust laws.

Somehow, some people seem to operate under the misconception that to be a monopoly you've got to have 100% of the market, and own all the pipes that deliver the gas, or all the wires that deliver the electricity. It's all about barriers to entry, no matter what form those barriers might take.
"

You seem to be making things up as you go along. Apple does a few things. It makes the world's best smartphones and mp3 players. It is the most successful by a country mile. People do not buy iPods and iPhones because they need something they can use with iTunes. That is a very tenuous argument. Yes, iTunes did, and probably still does enhance the appeal of iPods and iPhones. But if Apple is being anti-competitive, it's because their products are far and away better than the opposition. And they have spent a lot of money creating the ecosystem to make their products successful. What now, force them to sell competitorss products in their stores?

Secondly, Apple provides DRM free music, and, as has been pointed out, provides an xml file which third parties can use to find out what is in Apple's iTunes database. If Palm wasn't so lazy, they would have spent some of the money they used in developing the Pre to develop a nice way to sync music and anything else with their phone. These half measures are why every iPod killer fails, and it's not because Apple is being anti-competitive. It's because they actually think everything through.

Not all barriers to entry are bad. I think laziness is a legitimate barrier to entry.

Reply Parent Score: 0

RE[3]: Monopoly?
by sbergman27 on Sun 26th Jul 2009 15:55 in reply to "RE[2]: Monopoly?"
sbergman27 Member since:
2005-07-24

You seem to be making things up as you go along.

Specify. You make this assertion and then utterly fail to support it in the text which follows.

Not all barriers to entry are bad. I think laziness is a legitimate barrier to entry.

You're confused. Here's how it works. Barriers to entry are not intrinsically good or bad. As you note, providing a good product or service can be viewed as a barrier to entry. However, once you control a certain portion of the market, and it can be shown that barriers to entry exist in that market because of you, then you can and should be declared a monopoly. Now, monopolies, like barriers to entry, are not intrinsically good or bad in and of themselves. (Though I would venture to assert that it is not a good sign regarding the condition of free competition in that market.) However, with great power comes some added responsibilities and restrictions, because you, as a monopolist, can exert forces on the market which are qualitatively different than what would be exerted if a non-monopoly-holding player acted in exactly the same way. The monopolist may not like the extra restrictions. And naive observers may fail to grasp the qualitative nature of the difference between a monopoly and nonmonopoly player doing exactly the same thing in the same market.

But the prime mover is, and should be, the welfare of The People, in this case called the consumers. And that pretty much requires the legal mechanisms which we have in place to ensure that monopolists are constrained to act with the welfare of competition in their market in mind.

And I might note that your post seems to make up a few things that I supposedly "said" as it goes along. ;-) Or perhaps you simply misunderstood what I was saying. Hopefully this post clarifies things.

Edited 2009-07-26 16:02 UTC

Reply Parent Score: 2