Tuesday, March 1, 2022 [Tweets] [Favorites]

Apple Says It’s Complying With ACM

Toby Sterling:

The Dutch antitrust regulator on Monday issued a sixth weekly fine of 5 million euro ($5.7 million) against Apple for failure to comply with an order to open its App Store to alternative forms of payment for dating apps in the Netherlands.

Sami Fathi:

In a letter obtained by MacRumors, Apple’s head of compliance, Kyle Andeer, has defended Apple’s plan and said it believes it is fully compliant with the ACM ruling and that Apple has a “consistent and longstanding commitment to compliance in each and every country in which we do business.”

[…]

Apple’s requirement that dating apps submit a different app binary if they wish to use a third-party payment method or redirect users to the web for in-app purchases is “a straightforward prerequisite,” according to Apple. The additional app binary ensures “that Apple complies with its legal obligations in the Netherlands while at the same time having the ability to maintain its standard terms and conditions in the rest of the world,” Apple added.

Apple emphasized in the letter that the practice of employing an additional app binary is not complicated or costly for developers to do.

Florian Mueller:

Practically, we can ignore the difference because the bottom line is that Apple’s position is clearer than ever in light of the letter Reuters reported on earlier today. Apple genuinely believes to be acting in good faith--and I can actually see why.

[…]

I can’t take those news of non-compliance sanctions seriously as long as the ACM, which is not just an antitrust watchdog but also has a broader responsibility for consumer protection, isn’t defending consumers against a pricing scheme under which some reportedly paid fives times more than others for the very same service.

Previously:

14 Comments

Beatrix Willius

This feels so wonderfully wonderful. Imagine telling an Apple reviewer "but I already did what you wanted". This would go over so well.

"I can’t take those news of non-compliance sanctions seriously as long as the ACM, which is not just an antitrust watchdog but also has a broader responsibility for consumer protection, isn’t defending consumers against a pricing scheme under which some reportedly paid fives times more than others for the very same service."

I don't actually understand what Florian is saying here. Is it that the ACM should not penalize Apple because there are other companies that do worse things? Or is there some causal relationship where Match Group's behavior directly makes Apple's behavior less problematic?

He clarifies his point like this
> If, however, the ACM doesn't really care about whether Dutch dating-app users are treated fairly, then maybe they should finally "agree to disagree" with Apple, stop those weekly fines and let the appeal run its course.

I would have thought most people had tried and failed that argument by now.

Kevin Schumacher

> I don't actually understand what Florian is saying here.

He's saying the ACM should be looking at conduct holistically, and it's hard to take someone seriously when they're enraged about one side of a situation but ignoring the other. In this case, since the same body is responsible for both functions (antitrust as it arguably applies to Apple's conduct and consumer protection as it applies to Match Group), it could look as though they are willfully ignoring problems with a company that submitted a complaint about somebody else.

It's like an argument I had with a roommate once. I had left some steak knives sitting on the counter at the back where the counter met the wall, and the roommate was very upset, claiming it was a safety concern. I vehemently disagreed, since you would have to be just wildly flailing about with your eyes closed to have any chance of hurting yourself in that situation.

However, this same roommate would do dishes by filling the sink with water and putting in dishwashing liquid, so the sink had an opaque layer of soapy bubbles on top, then proceed to chuck knives and other sharp utensils in the sink and stick his hands into the now sharp utensil-filled sink that he couldn't see into. I had a real problem taking seriously any "safety concern" about knives sitting out in the open at the rear of a counter so long as he was basically sticking his hands into a black box filled with things that could actually easily hurt him.

It is very unclear to me what the weekly fines are proving. They're not large enough to materially impact Apple, so they have no more motivation to meet the ACM in the middle than they would otherwise. Apple is appealing the ruling, and presumably if they lose, some lump sum fine at the end could be imposed, so ACM likely wouldn't be losing out on any money coming to them by waiting for the appeal. In the meantime, it's the worst kind of government action—security theater, but for antitrust enforcement.

I have to say I've also been reading Mueller's running commentary on these Dutch fines with an increasing sense of confusion. His main point seems to be that if he were prosecuting Apple for anti-trust violations, he would do things differently. But I don't really get the sense from his posts that he's speaking from a place of authority on why the ACM is acting the way it is, or the Dutch legal system generally. When he says the ACM should "keep a low profile in this enforcement" or "agree to disagree" -- is that kind of thing even legally possible? I'm not a lawyer and I don't fully understand the situation, but I don't come away from Mueller's articles with more knowledge of how we got into the situation he's so intent on critiquing.

And then he says he can't take the sanctions seriously. Like... okay? It's a fine issued by the Dutch government. It exists and has legal ramifications outside of how seriously anyone, even Apple, takes it.

"He's saying the ACM should be looking at conduct holistically"

So he *is* saying that Apple's behavior, when looked at holistically, becomes less problematic, because other companies also do problematic things? I guess I still don't understand what the causal relationship is that makes Apple's behavior less egregious here.

"it could look as though they are willfully ignoring problems with a company that submitted a complaint about somebody else"

Oh, I see. Honestly, that strikes me as an incredibly problematic position. It's a bit like saying that the police shouldn't investigate an assault on somebody before making sure that the person who was assaulted didn't do anything illegal in the past. That just disincentivizes victims from seeking legal help.

The steak knife example you bring up is great, because it shows exactly the issue: you have two different situations that are ostensibly unrelated, but it is human nature to conflate them, and react to criticism by pointing out other, unrelated things, instead of just evaluating the validity of the criticism. Whether your housemate throws knives into soapy water has absolutely no causal connection to whether leaving knives out is or is not dangerous. Either it's dangerous, or it is not. Some other potentially dangerous actions will make it no more or less dangerous.

Imagine if the court system actually worked like this. "Yes, your honor, I did poison my husband, but he drove way too fast on the highway last week, which is incredibly dangerous, so you must acquit."

Doing bad things does not mean that you suddenly no longer have any legal protections!

"ACM likely wouldn't be losing out on any money coming to them"

I very, very much doubt any of this money is going to the ACM.

"In the meantime, it's the worst kind of government action—security theater, but for antitrust enforcement."

So you're saying that the ACM should impose higher fines, because the current ones don't really hurt Apple? I mean, I would guess that the ACM is acting inside its legal constraints. They can't just do whatever they want.

I would also guess that they prioritize the things they focus on based on their impact on actual consumers. Lots of people buy apps in the App Store, but very few people pay for Tinder subscriptions.

And finally, it's pretty obvious that this isn't about dating apps at all. The ACM is focusing on dating apps to limit the initial scope of their actions, because, again, they are one agency with limited resources that can't do literally everything at once. It's bonkers to tell them to do less because they aren't doing enough.

So what do people actually want? Should nobody do anything against Apple's illegal behavior because nobody is going to do enough, given how rich Apple is, and other companies are also doing illegal things anyway, so everybody should go after everybody else first? None of these arguments make any sense to me.

Wether or not Tinder are aassholes has no bearing on wether or not Apple are assholes.

The Florian argument actually protects both of them. Tinder could just say "Why are you investigating us when CLEARLY apple are using their control of the App store to gain unfair advantages! Take them to trial first!"

And around and around it would go.

"Why are you condemning Russia when the US are putting children in cages at the border?!"

“Apple emphasized in the letter that the practice of employing an additional app binary is not complicated or costly for developers to do.” - wow. Just wow. Can you imagine the pain of that? How do you tell your customers to download the correct version? You can't even reference the other version in the “universal” app, since that would violate Apple’s rules about referring to other payment methods.

Also, it would have a different bundle ID, different container, different preferences, etc. Users would end up with both versions installed, or the wrong version, and be completely confused. All of which is perfectly fine with Apple.

Kevin Schumacher

> So he *is* saying that Apple's behavior, when looked at holistically, becomes less problematic, because other companies also do problematic things?

I didn't say that. See the rest of my sentence that you didn't quote. It's hard to take the ACM seriously about being enraged at Apple's behavior and not Match Group's, especially when Match Group's behavior much more opaquely harms consumers. I did not say, attempt to say, imply, attempt to imply, or in any way, shape, or form try to make words convey the impression that the magnitude of Apple's behavior is affected by Match's misdeeds.

> It's a bit like saying that the police shouldn't investigate an assault on somebody before making sure that the person who was assaulted didn't do anything illegal in the past.

I'm not quite sure who you're arguing against here, but that has no relation to what I said. I said the ACM could appear to be ignoring Match Group's problems because they filed a complaint against Apple. I did not say a word about investigating a complainant before taking their complaint or anything of the sort. Especially since these problems with Match Group came to light a long time after the Apple complaint was filed.

> Whether your housemate throws knives into soapy water has absolutely no causal connection to whether leaving knives out is or is not dangerous.

I did not say it did. I said that I cannot take someone seriously who looks at two similar situations, one of which is objectively more dangerous, and then rates them the opposite (which to be clear, is not necessarily what's going on with the Match Group/Apple situation, though I do agree with Florian's assessment that of the two, regarding IAP, Match's actions are opaque and Apple's are transparent). Or more generally, who takes two problematic situations and addresses one with outrage but ignores the other.

> I very, very much doubt any of this money is going to the ACM.

It is bizarre to me that you read things completely out of thin air in some cases and in others cannot stretch an iota beyond the literal written words. It was shorthand for referring to whether fines would be collectable if Apple lost in court, not an in-depth exploration of the path the money takes after it leaves Apple's bank account.

> So you're saying that the ACM should impose higher fines, because the current ones don't really hurt Apple?

In a general sense, yes, but the paragraph was actually drawing a conclusion on whether the ACM should wait out the court case or impose weekly fines. Imposing these meaningless fines now is attempting to put on a show of strength, but it just makes them look silly.

> Lots of people buy apps in the App Store, but very few people pay for Tinder subscriptions.

Given that the current case is about IAP/subscriptions in dating apps, and Match Group has something of a stranglehold on that market*, literally the entire case is about the consumers who pay for Tinder and other dating app IAP/subscriptions.

Should the ACM ultimately prevail and widen its scope in future enforcement actions, as it seems to have indicated it wants to do, then your argument would make more sense.

> None of these arguments make any sense to me.

That could be because most of your post is spent arguing against things I didn't say.

* "For those that are unaware, Match Group owns every popular online dating property outside of Bumble, Badoo, and Grindr."
https://finance.yahoo.com/news/match-group-mtch-smart-long-043536375.html

Kevin Schumacher

@Peter

> How do you tell your customers to download the correct version?

Any given user will only have access to one of the binaries.

Apple's current proposal is that, for The Netherlands, you get one app, either one that uses Apple IAP or one that uses external IAP. If you choose to use external payments, you have to submit a binary for distribution only in The Netherlands that has the entitlements to allow that. You continue to submit a different binary for the rest of the countries you distribute your app in, and obviously that will continue to use Apple IAP.

Where I could see potential confusion is existing users migrating to the new binary. Since it's a new bundle ID, presumably it won't just show up as an update for existing users. I'm not sure what the plan is for that. For new users after the Netherlands-specific binary is released, the only binary they'd ever have access to would be the "correct" one, so there's no possibility of them ending up with the "wrong" version.

> since that would violate Apple’s rules about referring to other payment methods.

I'm going to go out on a limb and say, even if Apple's plan were accepted 100% as-is, there is no way they could get away with preventing developers from telling users to download a new binary (assuming that there is not a more direct migration path, which is something else it seems like the ACM would be keen to require of Apple).

"I did not say, attempt to say, imply, attempt to imply, or in any way, shape, or form try to make words convey the impression that the magnitude of Apple's behavior is affected by Match's misdeeds."

If you agree that there is no connection, why are you insisting on drawing one?

"It's hard to take the ACM seriously about being enraged at Apple's behavior and not Match Group's, especially when Match Group's behavior much more opaquely harms consumers"

This whole line of argument is a complete non sequitur.

If I lived with somebody, and asked them to not leave knives out because I think it's dangerous, and their response was to point out that they couldn't take me seriously because of how I wash my dishes, I'd classify that as antisocial behavior, and move out. The problem here is your mental model of these types of conflicts.

Kevin Schumacher

OK, buddy, I'm done. You can continue making crap up by yourself. I should have known better after the last thread. The irony of you calling somebody else's behavior antisocial...

Florian Mueller is definitely trying to argue that ACM is in the wrong in investigating Apples predatory use of their control over the app store, unless they ALSO investigate Tinder for something completely different.

But wait! Before they can investigate Tinder, then surely they must investigate Uber, Amazon, every single airline in existence etc. They all have elastic pricing based on some algorithm somewhere.

BUT WAIT! If elastic price setting is to be examined... then SURELY capitalism must be put on the stand.

Etc etc.

Florian is making a silly argument. End of.

@ Kevin Schumacher

He’s saying the ACM should be looking at conduct holistically, and it’s hard to take someone seriously when they’re enraged about one side of a situation but ignoring the other.

Is it?

I can dislike that there’s a war going on in Ukraine without the need for “what about Yemen?” and “what about when NATO was the aggressor” counterarguments. Those are also areas to explore, but they’re not the areas I’m exploring right now.

When discussing what Apple’s restrictions on dating apps in Netherlands are fair, is it really material whether one of the biggest dating app companies itself also has problematic business practices?

In this case, since the same body is responsible for both functions (antitrust as it arguably applies to Apple’s conduct and consumer protection as it applies to Match Group), it could look as though they are willfully ignoring problems with a company that submitted a complaint about somebody else.

But that’s how those agencies work.

When you file a lawsuit, the judge evaluates that lawsuit. They don’t then point back at the plaintiff going, “oh yeah? I looked through your history, and here’s problematic behavior of yours”.

An antitrust agency works similarly. You can argue that they should look at software distribution on mobile devices more holistically, or at price abuses of dating apps (ironically, before OkCupid was owned by Match Group, they made a blog post with a pretty solid argument that a for-pay dating app is always problematic, because its incentives will always be to actually keep you around, not help you find a date and ultimately unsubscribe). But neither of those are the current case. And the current case itself already has merit.

ACM likely wouldn’t be losing out on any money

?

It’s an agency, not a for-profit business. They’re not in it to avoid “losing out on money”.

it’s the worst kind of government action—security theater, but for antitrust enforcement.

No, it’s an agency doing its job. You seem to be making a much grander “are antitrust agencies even effective” argument, but there’s nothing the ACM can do to even interrogate that. That’s for legislators to decide.

It’s like going to a data center and complaining to an admin, “oh, this piece of software running on your systems is so inefficient. It shouldn’t need a single dedicated server, let alone five!” Like, wrong number. Entirely wrong department. Complain to the devs.

@ Plume

I would also guess that they prioritize the things they focus on based on their impact on actual consumers. Lots of people buy apps in the App Store, but very few people pay for Tinder subscriptions.

I don’t really get your point here. If very few people pay for those subscriptions, why is the ACM’s case against Apple on payment providers in dating apps even relevant?

(There are ~8 million paid Tinder subscribers. So indeed, not that many, in the grand scheme of things.)

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Apple emphasized in the letter that the practice of employing an additional app binary is not complicated or costly for developers to do.

Uh, OK. By that same token, enhancing your App Store so that it delivers different payment configuration “is not complicated or costly” for Apple to do.

Heck, the App Store already does server-side switching of certificates, and even making microarchitecture-optimized binaries. You can figure it out.

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