0:00

We were supposed to record yesterday. There was

0:02

a reason why we didn't. I'm not sure we want to share, but

0:04

there was a reason why we didn't. And

0:06

then today, massive Apple news

0:09

broke from this

0:11

DOJ lawsuit. And so we

0:13

look really prescient. We

0:15

look like we had a really good inside

0:18

line to say, like, wait, hold the show

0:20

until tomorrow. Well, we did. We did kind

0:22

of know. I mean, everybody knew the rumors

0:24

that the DOJ thing was going to be

0:26

announced were known before we began recording. They.

0:28

Yeah, but I think they were like a

0:31

little bit still squishy, like it might happen.

0:33

It's rumored to happen. Maybe to be clear,

0:35

we wouldn't. We would have just recorded as

0:37

usual because here's the thing. You have to record sometime.

0:39

There's always going to be more news that comes after

0:42

the show. And, you know, there

0:44

is no way I would have said, oh, well,

0:47

because the DOJ thing is supposed to come out

0:49

tomorrow, we should delay. No, I don't record and

0:51

we'll talk about it next week. But as it

0:53

turns out, no, no, no, no, no, no. This

0:55

is the advantage of us accidentally bumping a day

0:57

is we can claim like Marco's trying to do

1:00

until you know, we can claim that this is

1:02

all just that's how good we are. Your

1:04

hosts are that dedicated. It's not being good.

1:07

That's being I don't want to have the

1:09

reputation that we would delay the show because of news because everyone's going

1:11

to be like, oh, you should delay the show. There's news and no,

1:13

I feel like the show has to come when the show comes.

1:15

It comes once a week and there's going to be news that

1:17

happens before and there's going to be news that happens after. And

1:20

guess what? All the news that happens after it is fair game

1:22

for the next episode. You just have to pick one day during

1:24

the week and that's going to be the day. So we

1:27

occasionally shift things around. But for the most

1:29

part, I really just want to say we're

1:31

very regimented Wednesday. If possible, we are typically

1:33

very regimented. Yes, it was it

1:35

was my fault. Well, I don't know if it's

1:38

your fault necessarily. It was your problem. It

1:43

was very much my

1:45

problem. There were some, let's just say,

1:47

unexpected pyrotechnics. And so

1:49

I needed to delay a little while and

1:51

check your diet if there's actual fire involved.

1:53

There was no there was no I think

1:55

if fire is coming out of anything, you

1:58

have a problem. figurative

2:00

power to put it

2:02

into part i do love the idea though

2:04

i get some point we could like

2:06

you know get called into a grand jury testify

2:08

how we possibly had in for information that lead

2:11

out of the lawsuit and we might have to

2:13

actually like put that on the record this well

2:16

this is why we really delay the show it was

2:18

not in the information through some illegal leak right right

2:20

right it well it was a legal leakage but it

2:22

was not uh... but what if

2:24

i think he did hope he's the let's

2:27

just move right on to follow up holy smokes alright

2:31

so the m one macbook air that was dead we

2:33

had a funeral what two weeks ago we can't even

2:35

remember uh... it was dead and now it is risen

2:37

again like a phoenix from the ashes it

2:40

lives on at walmart

2:42

and best buy this

2:44

is amazing so here's

2:47

it so the news basically is apple

2:49

has directly stopped selling the macbook

2:52

m one m one macbook air

2:54

uh... what would it when it was the m three

2:56

but it was a two weeks ago when we go

2:58

whenever that was we all thought it they've making the

3:00

strong time to great computer but it's pretty old now

3:03

and they have they've gone to trip generations afterwards it's

3:05

time to do it that that made perfect

3:07

sense to us uh... they've

3:09

made some deal with walmart where

3:11

they are apparently going to still be making

3:14

this for some interval into the future we

3:16

don't know how long uh... but i

3:18

was out assume at least a year or two it's

3:20

available i think seemingly exclusively walmart in

3:22

the u.s. uh... for only

3:24

seven hundred dollars uh... and

3:26

then and what what was it about best by also

3:29

best by have it on sale for six hundred and

3:31

forty nine but i as far as i know the

3:35

walmart ones are not like this clearing their

3:37

inventory or their refurbished miles or whatever but

3:39

they are brand new

3:41

in the box and one macbook air on

3:44

for the best by six fifty one i

3:46

don't know that that is not just i'm

3:48

clearing inventory whenever apple wants

3:51

to clear access inventory of something without

3:53

doing their own like official sale or

3:55

price cut it's almost always this kind

3:57

of best by the best by is,

4:00

at least I don't know what to do here on the rest of

4:02

the world, but in North America, Best Buy

4:04

is first of all a huge retailer. So it's

4:06

easy to clear out inventory through there. And so

4:08

you can always kind of tell whatever Apple products

4:11

either they have too many of because they're about

4:13

to replace them or they just did replace them

4:15

or like in the case of the HomePod, they

4:17

just, they are not selling the way Apple

4:19

needs them to sell or wants them to sell or

4:21

they made too many. And so that's

4:23

kind of where they dump inventory without officially

4:26

saying from Apple's side, we're going to cut the

4:28

price. So my guess

4:31

is the Best Buy thing is temporary for like

4:33

for what was officially old stock,

4:36

maybe Best Buy's own old stock. But the

4:38

Walmart thing seems to be like Apple and

4:40

this is what's interesting is this is I

4:42

believe the first time Walmart's selling a Mac,

4:45

right? That's correct as far

4:47

as I know. Yeah. So again, for people not in the

4:49

US, you might not realize how big of a deal this

4:51

is. Walmart is massive and I'm

4:53

sure I know you've heard of it probably if

4:55

you listen to American media at all. But

4:59

there are so many American consumers

5:01

for whom Walmart is the

5:04

closest and unfortunately

5:06

oftentimes the only retailer that is

5:08

within a reasonable driving distance from

5:10

their house. So tons

5:12

of rural America, there is just

5:14

no big box stores, no Apple

5:17

stores, nothing except Walmart's. There's a

5:19

huge amount of the US buying

5:21

public that basically

5:24

only shops at Walmart for most things.

5:26

So to have not

5:28

been in Walmart all this time is a

5:30

pretty big deal. To be there now

5:32

is now also consequently a very big

5:34

deal. And what's interesting about

5:36

Walmart too is that partly by just demographics

5:39

of where they are and partly because of

5:41

their own brand, Walmart sells things cheaply. That

5:44

is kind of what they are known for.

5:46

Oftentimes they sell crappy things in order to

5:48

hit those prices. But

5:51

when you go to Walmart, you know what you're getting. You're

5:53

not going there to get the best of the best. But

5:55

they do have some brand name stuff. And so to have

5:58

anything from Apple is interesting. And

6:00

to have a Mac at Walmart for the

6:02

first time is also interesting. And to have

6:04

it be an M1 MacBook Air at a

6:07

price that Apple has never sold official new

6:10

computers at – I

6:12

mean maybe I guess the Mac Mini has hit those prices

6:14

but like nothing else. They haven't sold a

6:16

computer with a screen at that price, I don't think. Yeah,

6:18

a complete computer, let's say. So

6:20

to sell that at $700

6:23

for what is actually a pretty great computer

6:25

still, like yes, it's old. But

6:27

the M1 MacBook Air, let's not forget, like we

6:29

were just saying this when the M3 came out,

6:31

we were just saying how amazing this computer is.

6:34

So to have this as what seems

6:36

like a long-term inventory

6:38

item that a retailer as big

6:40

as Walmart means Apple is still

6:42

making them and that they

6:44

presumably don't want to sell it on their own

6:46

site to kind of encourage people who go directly to

6:49

Apple to get the higher price, newer offerings. It's

6:52

an interesting form of market segmentation that I

6:54

don't think they've really done to the

6:56

public. They've had education-only

6:59

items before, like less expensive iMacs, the

7:01

eMac and stuff like that. They've done

7:03

that. But to do this,

7:05

this is pretty new. And I think this

7:09

makes a lot of sense now

7:11

that we have – the Apple Silicon era jumped so

7:13

far ahead. Even this, what

7:16

is it, almost four-year-old computer, because

7:19

it was the Apple Silicon era, it's still

7:21

just really, really good. So this is a

7:23

great computer people can now get for $700

7:25

from Apple, well, an Apple computer they

7:27

can get from Walmart. That's a really

7:29

great new expansion for their market. I

7:32

think that's a very good idea. And what's

7:34

also interesting is that we heard those

7:36

rumors about six months ago that Apple

7:39

was preparing a new low-cost MacBook. Do

7:42

you think this was it? Do you think

7:44

– something got confused in the rumor chain

7:46

and it was just a rumor about this?

7:48

I don't think this sort of

7:51

thing – this is the type of thing that

7:53

would be easy to keep a secret probably because

7:55

it's just two companies talking to

7:57

each other that it's not like a supply chain or manufacturing.

7:59

or whatever, not to say that that other mover is ever

8:01

going to turn out to be true, but I don't think

8:03

this would have led to that rumor. I

8:06

don't know, because this probably would

8:08

have caused a little bit of supply chain rumbling in

8:10

the sense that they are going

8:12

to have to manufacture this particular laptop for... But

8:14

the supply chain would know that they're still making...

8:17

that they're making more of the same computer. The

8:19

supply chain wouldn't be confused to think that it

8:22

was a new computer. No, no, no, but it

8:24

is... but I think it is suspicious, you know,

8:26

if you only have a little bit of information

8:28

from the supply chain, it is kind of suspicious

8:30

to see that, hey, they're producing inexpensive laptop parts

8:32

for way longer than one model would normally be

8:35

produced. Like, maybe that's how it got started. Who knows?

8:37

Well, we'll see. As time goes on, if they're interested in

8:39

the cost model... Oh, speaking of the cost of this one,

8:41

the one ding against this is, if you're

8:43

going to keep selling in the Sim Cook way, keep selling your

8:45

old models for just way longer than anyone ever thought you would

8:48

keep selling your old models, in this case, it's fine, because as

8:50

you pointed out, the M1 is still great or whatever. But

8:53

if you are going to do that, it's going

8:55

to really, really highlight the

8:57

worst thing about your products with your Apple,

8:59

which is that you are so stingy with

9:01

the SSD space. Not even the RAM, because

9:03

whatever, it's a $700 computer,

9:05

8 gigs, like, but the SSD space. And

9:07

like, the thing about the RAM is, okay, so

9:09

it's got a small amount of RAM, but it's

9:11

incredibly inexpensive, and you can get by with it.

9:14

It will use swap, right? But when you run

9:16

out of SSD space, there's no more swap

9:18

for that. There's not a second SSD that you

9:21

can swap, like, it's a hard limit. And by

9:23

the way, going to swap because you have 8

9:25

gigs of RAM is just going to abuse that

9:27

tiny thing even more. So this

9:29

is not the fault of that computer, but it's

9:32

the fault of Apple for just being so stingy

9:34

and holding the line on the 256 space model,

9:36

because I believe that Walmart will only

9:38

sell the base model. There

9:40

is no like BTO option. I don't think

9:42

they have any other options for the sizing

9:44

of it. Certainly the $700 price is for

9:46

the base

9:48

model, right? So and if you if

9:51

they follow Apple's typical pricing, as soon as you put

9:54

a more reasonable size SSD in there, the price

9:56

would go up tremendously. So I think it's just

9:58

the base model. Yeah, like Those decisions are

10:00

bad at the time, but they get so much

10:02

worse when the machine is two or three generations

10:04

old and you're continuing to sell it as new,

10:07

not even refurb. So that's a sin

10:09

of Apple's past. That's, again, not the fault of this machine,

10:11

but it really, it makes me wish

10:13

that like, for example, the M3 MacBook Air should

10:15

no longer come with 256 SSD. It

10:18

shouldn't be an option at all. Like it's

10:20

just Apple being incredibly stingy and again, putting

10:22

all their margins into storage and RAM, which

10:24

is painful for all of us. And

10:27

a bad move in the long-term, I would argue. Please

10:31

consider becoming an ATP member today. Membership

10:33

is the best way to support the

10:35

show and you get some pretty cool

10:37

perks too. So we just launched this

10:40

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10:42

effectively a bonus topic every week. So

10:44

we record the regular show, we record

10:46

our regular after show, and then after

10:49

we go off the air, we record

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one more topic. Usually we're aiming for

10:53

15 to 45 minutes of

10:55

bonus content after each show and it's

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a tech topic. It's an

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ATP topic. So last week's episode, our

11:01

bonus topic in ATP Overtime was we

11:04

talked about the Rabbit R1, that

11:06

cool little play date looking thing that's the

11:08

little AI gadget. We've been wanting to talk

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about it for a long time. We never

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had time, we never got to it in

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the show notes. We finally found out a

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11:19

ATP Overtime. You can get it by becoming

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an ATP member today, atp.fm slash join. And

11:23

we're aiming to do this pretty much every

11:25

episode as far as I know. So we're

11:27

still trying it out, still brand new, but

11:29

ATP Overtime, bonus content for members on every

11:31

single episode. Somewhere on the order of 15 to

11:33

45 minutes extra and

11:35

a tech topic. So that's one of

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the benefits you get. You also get an ad

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Overtime now included in it. And you get the

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atp.fm slash join. It's the best way to

12:03

support the show. We really appreciate it. Thank

12:05

you so much. And now back to the

12:07

show. We

12:12

have some genuinely fascinating feedback from

12:14

an anonymous listener who writes, early

12:16

on in the car project, a very large

12:19

rack of server gear was loaded into the

12:21

back of SUVs for development and testing. When

12:23

the Apple Silicon team was asked to help,

12:25

it was years before Apple Silicon shipped in

12:27

Macs. The chip folks showed up with a

12:29

literal black box about the size of a

12:31

Mac Studio. There were instructions on how to

12:34

plug it in in an admonition not to

12:36

open the box. All software was

12:38

provided to the chip team and was already installed on

12:40

the box. When connected, this

12:42

Mac Studio size box outperformed the rack of

12:44

server GPU gear by an order of magnitude,

12:46

while consuming a fraction of the power. What

12:48

was in the box was never shared and

12:50

it was taken away after the test. One

12:53

of the interesting notes on Project Titan is

12:55

there was a huge effort to develop custom

12:57

sensors, LIDAR vision, et cetera, that would also

12:59

outperform industry standard equipment in both performance and

13:01

accuracy. What was in the

13:03

box? Who knows? I mean, I guess it

13:06

could have just been an M1 Ultra at that point

13:08

back then, but I don't know what things

13:10

they had in the server rack. But yeah, the

13:12

Apple Silicon participating in this process and the idea

13:14

that they're making their own LIDAR sensors just as

13:17

with everything involved with Project

13:19

Titan, it seemed like, you know,

13:21

when you start a new project, the

13:24

possibility space is big. Look at

13:26

all the things that we could do because we do have

13:28

a lot of money and there are lots of possibilities. Let's

13:30

explore them with money and time. But

13:32

unfortunately for Project Titan, they never really seemed

13:34

to narrow that to something that they wanted

13:36

to do and so the project was canned.

13:38

But it doesn't surprise

13:40

me that, especially in the early

13:42

days, they were like, and we can make our own LIDAR

13:44

sensors and they'll be better than everybody's and we'll have our

13:47

own Silicon and that'll be better than everybody's and they just

13:49

really didn't know what they were doing in the end. But

13:51

that is interesting. Again, rumors

13:53

of Apple Silicon for the car project, rumored

13:55

to be as powerful as,

13:58

what did they say, for M-C? two ultras or something

14:00

like that? I don't

14:03

know what stage those designs get, but if they have

14:05

anything that's in a box that size up at Mac

14:07

Studio, it must have gotten far enough along that it

14:09

was fabbed on a reasonable process that it

14:12

could be cooled in, I

14:14

don't know. I would love to hear more about this, but

14:16

we have to wait for all these people to get old

14:18

and retire. Alright.

14:23

Wade writes with regard to John Safari hangs,

14:25

when Safari gets into that state where it

14:27

just stops doing network traffic. You described it

14:29

as like, as though it's out of file

14:31

handles. It's because of a deadlock bug in

14:33

the Safari networking sub-process. If you kill that,

14:35

for example, in Activity Monitor or with Kill

14:37

All, it relaunches automatically and the problem is

14:40

temporarily fixed. Note that killing Safari networking can

14:42

sometimes cause open tabs to essentially crash, requiring

14:44

full reload. It's funny you bring this up,

14:46

but was this from the most recent member

14:48

special? Is that right? Yeah, that's when I

14:50

was talking about why I use Safari in

14:52

Chrome and that Safari still sometimes starts

14:55

refusing to load web pages for me. So

14:57

this happens to me, I don't think I said anything during

14:59

the show because you were vibing in a great way. I

15:01

didn't want to ruin your whole flow there, but this

15:05

happens to me not often, but often

15:07

enough that it's annoying. Coincidentally, it happened

15:09

earlier today and I tried

15:11

to do exactly this and it didn't make a darn bit

15:13

of difference. Now, it very well could be user error, maybe

15:16

I screwed something up, maybe I didn't quit the right thing

15:18

or kill it in the right way, but it didn't do

15:20

anything for me. Now, have you tried this, John? Has

15:22

this worked for you? No, I haven't had a hang

15:24

since getting this, so I'm glad you tried the experiment

15:26

yet. I mean, this probably worked

15:29

for Wade, maybe that's where the problem was there, although I

15:31

would say to the people who are writing the Safari networking

15:34

subsystem, maybe use structured concurrency might help avoid

15:36

those deadlocks. Yeah, make sure all the threads

15:40

of execution are always making forward progress. Yeah,

15:42

that's all like C++ though, isn't it? I don't think they

15:44

can get there. Yeah, I don't know. I was

15:46

just saying like, deadlock,

15:49

yeah, it's a problem. Concurrent programming is hard. Next time

15:51

it happens to me, I will try it and

15:53

I hope it does work, but I'm not particularly optimistic.

15:56

Yeah, I mean, I'm going to try it again because like I

15:58

said, maybe I was holding it wrong I mean what

16:00

else can you do like my alternative is I

16:02

quit have to quit Safari right or for me

16:04

sometimes if I close enough Safari windows that starts

16:06

working which is very suspect or wait like a

16:09

really really long time perhaps long enough for like

16:11

some watchdog to Trip and then it maybe

16:13

does all this resetting it. I've never had waiting work

16:15

for me I mean, I maybe haven't waited 24 hours

16:17

or something But I've waited like 15 minutes or something

16:19

like that I think yeah because I would like walk

16:21

away for the computer like all this is annoying me

16:23

I leave and then I come back later in the

16:25

day and I remember oh, yeah safari still misbehaving. So

16:27

waiting has not worked for me cool All

16:30

right. So we have a

16:32

lot of legal news and part of

16:35

it is with regard to Apple doing

16:37

a nine-hour Workshop

16:39

feedback session thing. It wasn't Apple.

16:42

It was it was this was

16:44

a nine-hour feedback session about Apple

16:47

Run by the okay. Thank you. So this

16:49

happened somewhere overseas. I'm not even entirely sure

16:51

where it happened geographically But it's somewhere in

16:53

Europe and there was a whole

16:55

bunch of talk about it We'll put some links

16:57

in the show notes It

17:00

seems like it went it

17:02

went I don't even know if I would say well or

17:04

went poorly but it went it was a thing And

17:07

I don't think anyone left exceedingly happy. Although

17:10

I'm not sure if anyone left angry Well,

17:12

it's just a feedback session. This is a

17:14

groupers summary of it from his post about

17:16

it He says this was an opportunity for

17:19

critics of Apple's DMA compliance plans to address

17:21

questions to representatives from Apple And

17:23

there is a video apparently but it's behind a password

17:26

Which group gave them some stick about for

17:28

not being transparent and he says

17:30

I can't imagine sitting through that even at 2x

17:32

speed But lucky for us cage belly followed along

17:34

and took copious notes in a thread

17:37

on Twitter So we'll link to the Twitter a

17:39

thread of someone who was watching the video and

17:41

writing the interesting things in tweet size Bits

17:45

Steve Trump Smith also used the whisper

17:48

Transcript generator thing to get text out of it. Obviously whisper

17:50

is going to be a little bit confused by technical jargon

17:52

and stuff But we'll put a link to that in the

17:54

show notes as well. He's got it up on github And

17:58

then there is one video clip of

18:00

a Riley Testuits question, the Alt Store

18:02

guy. He was asking about the idea

18:06

that, he was using an example from

18:08

his life. I think he had a viral

18:11

hit application that was a free download on

18:13

the iOS App Store when he was younger,

18:15

like in college or high school. If

18:18

that happened to me today, and I'm like,

18:20

I'm just a student and I make a free app,

18:23

no in-app purchase, I think it's just 100% free, and

18:25

I put it up on one of these alternative stores and

18:27

it becomes a viral sensation overnight and everyone's downloading it if

18:29

someone talked about it on TikTok or something, I

18:32

would owe Apple five million euros. And

18:35

so his question to the Apple representative who was

18:37

like a Kyle Andier of a VP of Apple

18:39

Legal thing, what

18:42

would happen? Would you try to extract five

18:44

million euros from this student who had a

18:46

viral hit application? And the response was, a

18:49

bit of the end of the response from the Apple representative

18:52

was, this is something we need to

18:54

figure out and it's something we're working on. So

18:56

I would say on that one, stay tuned, which

18:59

is not much of an answer, just saying,

19:01

yeah, that does sound bad, we'll figure something

19:03

out. But I think feedback sessions like this,

19:05

I mean, I feel like what

19:07

Apple should have said is, well, if you don't want that

19:10

to happen, stay in the app store, because we don't charge

19:12

you anything for free apps. And then the EU would have

19:14

said, yeah, but the whole idea is we want the alternative

19:16

app stores to be an actual alternative, not something that's always

19:18

bad. And that was kind of what

19:20

I imagine all nine hours of this was. If you look

19:22

at the Twitter thread, there's a lot of statements

19:25

by representatives of the EU saying

19:27

things like, yeah, we don't think

19:30

that thing Apple is doing is

19:32

compliant. Like just as

19:34

an aside, like I forget if the core technology was

19:36

one of them, but a whole bunch of like large

19:39

components of Apple's compliance, they

19:42

would just offhandedly say, yeah, that's their, I don't

19:44

think they can do that. So this was just

19:46

a feedback session. And I don't

19:48

think it's worth dwelling on the minutia of it, because

19:51

I think what will happen is, guess what? More changes.

19:54

Last time, like, yes, they had nine hours of

19:56

feedback. And surely in response to the nine hours

19:58

of feedback and back and forth. Apple's

20:00

going to have to change more stuff

20:02

because there were big parts of their

20:04

compliance that the EU representatives were like,

20:07

nope, yeah, that's not it. And

20:10

so I guess this topic is not dead and we

20:13

will be revisiting it. Harvey

20:15

Simon writes, this was weeks ago and it keeps

20:17

getting pushed down in the show notes, but

20:19

Harvey Simon writes with regard to magnets and Apple Watch

20:21

bands, regarding its own Apple Watch

20:23

bandwidth and magnetic closure, Apple says,

20:26

quote, BAM contains magnets and may cause interference

20:28

with compass on Apple Watch. Quote, this is

20:30

for, what is this, the modern

20:32

buckle? I think that's right. And

20:35

so Harvey asks, you know, if magnets don't interfere with

20:37

the compass, why does Apple say they may? And

20:39

I presume the answer to that is, you know,

20:41

in part liability, in part just general cover your

20:43

butt. But one way or another, there

20:45

is at least the possibility that there's some interference. I

20:48

mean, yeah, they say they may. I don't know.

20:50

I think it's a butt covering as well, considering

20:52

they sold that strap for a while and you

20:54

didn't hear widespread reports of saying, my compass doesn't

20:57

work on my Apple Watch. And I found that

20:59

it's because of this magnetic latch. I mean, in

21:01

all fairness, I don't think they sold a lot

21:03

of modern buckles. I've seen a

21:06

very small number of them ever in real

21:08

life. However, there are lots of other Apple

21:10

Watch bands that have magnets in them, like,

21:12

for instance, the leather link or

21:15

now the fine woven link, full

21:17

of magnets. The Milanese Loop also has pretty big

21:19

magnets in it. So, you know, there's not only

21:21

one band. It turns out, like, probably a third

21:24

of the bands have either one

21:26

or many magnets in them. So I

21:29

just I don't think this is a big deal. I

21:31

think it's kind of interesting that they even say that

21:33

it may interfere, because especially on the modern buckle, the

21:35

magnet is on the opposite side of your fleshy wrist

21:38

from the watch. It's pretty big distance. And, you know,

21:40

so I don't know. All

21:43

right. So I don't remember how

21:45

you stumbled onto this, John, but

21:47

you have a very curious obsession

21:51

with the widths of the streets in front of

21:53

people's houses. How did we land here? I

21:55

wasn't. We're talking about this in like in

21:57

the member special or something. I don't remember.

22:00

how it came up. It was recent though. It

22:02

was in the last week or two and I

22:04

don't remember how or why this came up. The

22:06

main issue is I'm basically complaining about how difficult

22:08

it is to navigate my streets and then of

22:10

course Marco chimes in and said we don't even

22:12

have streets we just have sidewalks the cars go

22:14

on and then you

22:16

take for granted your ridiculously wide streets and you

22:19

I think you said mine aren't that wide they're

22:21

not that much bigger than yours so as I

22:24

said I think when we first came up we got

22:26

to do some street measuring. And

22:28

we did. We did so we

22:30

have some street widths. Marco

22:32

is the winner at the beach with

22:34

the tiniest streets and having been there

22:37

I can I can attest to this.

22:39

Street slash sidewalk let's say. Yeah. We

22:41

call them walks. The tiniest paved area

22:43

which well paved with sand. Paved in

22:46

quotes. It's concrete squares. Mm-hmm.

22:48

Eight feet wide. Yep.

22:50

Underscore chimed in from

22:53

the UK saying his are nearly

22:55

20 feet wide. John

22:57

you measured yours and you got

22:59

to about 23 and a half feet and

23:01

I'm sorry if you live anywhere with sensible units

23:04

we're not going to convert it just look it

23:06

up. And for me I rank at

23:08

35 feet well basically 36 feet so I am the winner for sure.

23:12

Well the winner in the sense that you

23:14

live somewhere where there's so much empty space

23:16

they're able to make the streets a

23:19

third wider than most places. It's

23:21

basically like new obviously so you're a special case

23:24

Marco because you're not in like a normal street

23:26

area or whatever and so it's a very limited

23:28

space there and you got your little things and

23:30

they don't expect there to be two-way traffic on any

23:32

of these roads right. Underscore

23:35

is obviously in the UK with notoriously

23:37

narrow lanes as they call them. And

23:40

then Casey I think the reason his

23:42

are so wide is because he's probably

23:44

in the newest development like the all

23:46

the houses around him were constructed like

23:48

you know they're certainly after

23:51

mine and probably after underscores. And

23:54

that's what I think the land

23:57

that I'm living on was probably settled a long

23:59

time ago. and these streets and

24:01

roads existed and were made back

24:03

when maybe horse-drawn carriages were on

24:06

them or much narrower cars. And

24:10

so they're sized incorrectly for

24:12

modern vehicles. They're maybe

24:15

sized incorrectly for automobiles entirely, even

24:18

more so than in a lot of the roads

24:20

on Long Island that were made for maximum speed

24:22

of 45 miles an hour and like, you know,

24:24

Model P's or whatever going on them. But yeah,

24:26

that's why the roads are wider. It's not that

24:28

they have so much extra land. That land was

24:30

not, there was no road there until some developer

24:33

came and said, we're going to build a bunch

24:35

of houses here. And by the time they did

24:37

that, they used essentially the best practice for road

24:39

widths, which is way wider than

24:41

it was in the 1900s. I remember the heck

24:43

my road was made. So yeah, I

24:45

didn't do the math I meant to

24:47

and I completely forgot. I didn't do

24:49

the math of you had said to

24:52

me, I don't remember if this is

24:54

privately or during the show, but you

24:56

had suspected that Erin's truck, car, SUV,

24:58

whatever you want to call it, SUV,

25:00

I guess, could park perpendicularly across the

25:02

road and have quite a bit more

25:04

road left over. Perpendicularly across the road

25:06

and then the space remaining after you

25:08

parked sideways against the curb, like your

25:11

rear bumper against the curb, the

25:14

remaining space would be the width of

25:16

my road. That is incorrect. But you are

25:18

not entirely out of bounds. It is incorrect.

25:20

But it is because I think her car

25:22

is something like 15 feet, which would make

25:24

it like three. Your road

25:26

is three feet longer than the remainder there. Yeah,

25:28

that was back when you said your roads were

25:31

37 feet. Yeah, well,

25:33

whatever. That was an estimate. Anyway, here's the point.

25:35

If you look at it, we'll put a picture

25:37

in the show notes or maybe it'll be the

25:39

chapter. When you

25:41

look at my obviously Marcos thing is

25:43

not a real road. So disregard that.

25:45

Underscore lives in Maryland, England, so whatever.

25:47

Mine is not that much bigger than

25:49

that's a big disregarding right there. Yeah,

25:51

my mind is not that much bigger

25:53

than underscores. Keep this in

25:55

mind when you look at this right. So Marcos Marcos road

25:57

is essentially the width of his car. There are one. is

26:00

that wide essentially? Like, that's a lot. Especially

26:03

if you include the mirrors. I believe it is

26:05

exactly. Yeah. Yeah, if you include the mirrors, I

26:07

don't think there's a lot of space

26:10

left. I did look up the R1S

26:12

with it, and that's about it, right? So take that

26:14

as being a car with, and take

26:16

two. We're both looking at

26:18

this picture here. Marco's road is purple, and mine

26:20

is green. Take two Marco with purple stripes, and

26:23

try to arrange them on my green road so

26:25

that two cars can pass each other going in

26:27

opposite directions. I swear to you, I live on

26:29

a two-way street. It is not a one-way road.

26:31

It is designed so that, in theory, two cars

26:33

can pass each other, one going one direction and

26:35

one going the other. So give each

26:38

car eight feet, just like Marco's thing here, and lay out

26:40

those two purple things, and see how much room you have

26:42

left, OK? And now consider this fact.

26:44

You are allowed to park on both sides of

26:46

my street. Ha ha ha. You

26:49

see how this doesn't work in a functioning

26:51

way, right? It's

26:54

not even one-side parking only. Even if it was one-side

26:56

parking only, I can tell you, when someone parks one

26:58

of their gigantic SUVs on one side of my road,

27:00

there's not enough room for two cars to safely pass

27:02

and the space remaining. Especially if

27:04

they don't literally have their rubber touching the

27:06

granite curbs on my road,

27:09

right? It is absolutely

27:11

ridiculous. And so that's why I'm

27:13

always complaining about it, because I'm constantly navigating these

27:15

roads or trying to get one of my teen

27:17

children to navigate these roads without scraping my wheels

27:19

against the curb or killing us

27:21

all. Oh, well. We

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caffeinated and for sponsoring our show. So

29:19

there is some news. The

29:22

US, the United States have

29:24

sued Apple for illegal monopoly

29:26

over smartphones and I don't

29:28

know the right way to approach this. I think we can

29:31

start going through little snippets

29:33

of what's in this lawsuit. Do

29:35

we want to do, John, an opening statement of any sort

29:37

or do we want to try to establish the ... I

29:40

think we can go through it in the

29:42

order as here with breaks at various points

29:44

to expound on things. So we'll

29:47

start with the summary from the Verge.

29:49

The US Department of Justice, Justice DOJ,

29:51

and 16 states and district attorney generals

29:54

have accused Apple of

29:56

operating in a legal monopoly in the smartphone market

29:58

in a new antitrust lawsuit. And I don't like

30:00

the headline. I copied the headline from The Verge.

30:02

US used Apple for a legal monopoly over smartphones.

30:05

But that, we'll get to

30:07

it in a little bit. I

30:09

saw the headline. I'm like, that could be better written, because that's not

30:11

quite it. So anyway, we will link you

30:14

to the Department of Justice press release,

30:16

The Verge article, and we'll link you

30:18

to the actual complaint, like the legal

30:20

complaint or whatever in the lawsuit that

30:22

is a PDF that you can read

30:24

through at your leisure. I've

30:27

read through the entire thing today.

30:29

Not that long, but

30:31

there are various excerpts from it. This

30:34

is, well, here's the framing I

30:37

would give. I

30:39

have lived through, we have all lived through one

30:42

other very significant Department of Justice lawsuit

30:44

in the tech sector, which was the

30:47

Department of Justice lawsuit, Antitrust lawsuit against

30:49

Microsoft in the what, 90s? Yeah,

30:51

late 90s. Late 90s. So

30:54

we've seen something like this before. And

30:57

a lot of our

31:00

discussion of monopolies and antitrust laws

31:02

in the US stems from that

31:04

case, because it's so similar. It's

31:07

in recent memory. It's in the tech sector. It

31:10

used the same US law as the basis

31:12

of the antitrust effort. It's the same US

31:14

law that is very old and predated computers

31:16

and any of this stuff, right? And so

31:18

it's just been reinterpreted through the courts. But

31:20

I guess that the best way to set

31:22

this up is that, unlike the

31:24

EU, DMA, all stuff that

31:27

we've been going through, this

31:29

is something different. This is the

31:32

government suing a private company

31:34

saying, you have violated some existing laws that

31:36

are on the books. Whereas the EU, DMA

31:38

thing is a governing

31:41

body saying, here are

31:43

some new laws you have to follow. And

31:45

that might seem like not a big deal, like what's the difference?

31:48

It's basically both out of the same thing, calling Apple they can't

31:50

do stuff or whatever. But it's

31:52

very different, because in theory, in

31:55

the EU thing, a bunch of people can get together

31:57

and say, we think this is how it

31:59

should be. And then they write it down and

32:01

then they give it to Apple and Apple complies with

32:03

it. Now that's the idealized version as we're seeing that's

32:05

not going that well. Right? Because

32:08

apparently it's a really hard thing to do, although I really feel like I could

32:10

have helped them a lot if they had consulted me, but they didn't. But

32:14

the DOJ thing or any other lawsuit, this

32:16

is what happens. The government says, company,

32:19

you broke a law and we're going

32:21

to go to court and try to prove that you broke a

32:23

law and win a verdict from, I don't know if it's going

32:25

to be a judge or a jury trial, I don't know of

32:27

all the legal intricacies, but whatever. It's in

32:29

a court of law and they have to prove, Apple,

32:31

you broke this law. It's an existing law and here's

32:33

how you broke it and we're going to prove it.

32:36

Right? And then if they're found guilty, they just appeal

32:38

forever and blah, blah, blah, whatever. Look at

32:40

the Microsoft wing. The Microsoft essentially lost, but then on

32:42

appeal got parts of it reversed and then they came

32:44

to a settlement and legal stuff

32:46

is always not right. But however

32:48

the court case goes, first of all, there is a court case with

32:50

all the U.S. rules of evidence and all that crap or whatever. Right?

32:53

And then after that, there's some kind

32:56

of, well, assuming they even go to like a verdict and

32:58

a remedy or a punishment or whatever, which is not

33:00

necessarily the case that could end up settling because a

33:03

lot of court cases end up with a settlement. They

33:05

said, never mind the court case. The two parties have

33:07

agreed to settle according to these terms. The government could

33:09

do that as well. But either way, there's either going

33:11

to be a settlement or some

33:14

kind of verdict and punishment

33:16

or remedy or whatever. And that

33:18

is determined like what Apple would have to do as kind

33:20

of like you lost the case, therefore

33:23

X is determined by the court case by I don't again,

33:25

I don't know how the details worked

33:28

out as determined by the jury, the judge or whatever. But

33:31

the whole point is it's not determined

33:33

by lawmakers. It's not determined by

33:35

a bunch of people getting together and saying, here's what we think

33:37

Apple should do. Instead,

33:39

they just say you broke a law. Here's how here's

33:42

the laws that you broke. And here

33:44

is the remedy for you breaking them. And

33:47

that is one of the worst possible ways to

33:49

get a result that you want. Right. Unless

33:52

it's like a court case where it's like I just want money from

33:54

you because you did something bad and now you're going to be fined

33:56

or something. That's not how this is going to go. Right. It's

33:59

so much better. better if you have, again,

34:01

in theory, a bunch of people who get

34:04

together and at their leisure come up with

34:06

a new set of laws or regulations or

34:08

whatever and say, there's

34:10

a problem. We're going to write a new

34:12

set of regulations that will tell Apple or

34:14

whatever, here's how it should be. And we

34:16

can consult people, we can talk to experts,

34:18

we can talk to all the other companies

34:20

in a second, we can talk to Apple.

34:22

In theory, what the

34:24

EU did with the DMA, only the US

34:26

version of it is make new regulations, make

34:28

new laws, say what you actually want, use

34:31

your words, right? Instead of saying, hey, a

34:33

law from 100 years ago, you were actually

34:35

broke that and we're going to prove it

34:37

and then we're going to punish you somehow.

34:39

And there are remedies listed in this thing,

34:41

but I have to say starting from zero, if you're wondering how

34:43

this is different from the EU thing, I can't

34:47

imagine that this is going to go better

34:49

than the EU thing. And the EU thing

34:51

is not going well, to be clear, because

34:54

this is like, it's not the way

34:56

to get the change you want to see in

34:59

the world is suing somebody and having the punishment

35:01

from this suit that you think you're going to

35:03

win change their behavior. And

35:06

that's why I'm extremely pessimistic about this entire thing. There

35:08

are other reasons which we'll get to as we start

35:10

going through that I'm pessimistic about it. But setting aside

35:12

the actual complaint, even if the complaint

35:14

had been written beautifully and perfectly and was

35:16

everything I dreamed it could be, in the

35:18

end, if Apple loses this case, determining

35:21

what they have to do as their

35:23

as the fix for them breaking this law is

35:26

so much worse than actually the writing a new

35:28

regulation where you can just say exactly what you

35:30

want. And that has really

35:32

got me not feeling great about this

35:34

whole exercise. Yeah,

35:36

having read this, I

35:38

went through the whole thing and I was

35:41

using my iPad and highlighting in green when

35:43

I was like, Yeah, in red when I

35:45

was like, Oh, gosh, and I

35:47

got to tell you a lot more red than

35:49

their screen. And even even when you were going

35:51

the Yeah parts like though, but when I was

35:53

looking through the parts that we'll get to the

35:55

parts we think, Oh, they've actually realized something reasonable

35:58

here. My question was always like Okay,

36:01

so say you're right about that and say

36:03

you prove it in court and say Apple

36:05

loses then what then? What is the

36:07

hard part? It's not like you could slap them on

36:09

the wrist and say Apple you were naughty Give me

36:11

$10. Okay go on your way Like they're going they're

36:14

going to ask for changes in behavior and again There

36:16

is a remedy section in this document, but it looked

36:18

at it and said this This

36:20

is like yeah Apple should probably do this that and the other

36:23

thing and maybe some other stuff We have a list here. Anyway,

36:25

you'll figure it out court. It's like no, that's the hard part

36:28

This is whole thing is like You know

36:31

the government's gonna prove that Apple was bad and

36:33

if they win. Yay, we all celebrate. No, we

36:35

don't celebrate What so you prove they did something

36:37

bad? What is the fix? How do you make

36:40

how do you make it better? That's the hard

36:42

part. Just ask the EU It's apparently really hard

36:44

to even even when you have the

36:46

force of law with you and you could tell Apple

36:49

you have to do X Y and Z apparently even

36:51

that is next to impossible to do with any

36:53

confidence and here Like I can't

36:55

look at this document. I'm like Let's

36:57

just assume that you're brilliant and everything you say here is right

36:59

and you win this case and it's a slam dunk and they

37:01

appeal And you win on all the appeals then

37:03

what the then what is just like then

37:05

then it's just probably going to either not

37:07

do anything or make things worse and it's

37:09

just Making me feel sad. Yeah,

37:12

and I think to finish like

37:14

my opening statement here I think the thing

37:16

that that's troublesome is that I Don't

37:19

think it's unreasonable for Apple to

37:21

be regulated or or be asked

37:24

to change or forced to change

37:26

Or have something like what the

37:28

EU is attempting and now with

37:30

the United States is attempting But

37:33

I don't feel like either organization

37:35

is doing a particularly good job

37:37

of it And that's

37:39

frustrating and the the Americans

37:41

at least having read the

37:43

overwhelming majority of this document

37:46

It is clear that this is a

37:48

bunch of people who don't really understand what

37:50

they're talking about Shaking their fist at the

37:52

air and going but that just doesn't

37:54

seem right and there's very little justification.

37:56

There's very little corroboration

37:59

there's just And there's very little

38:01

understanding of what's at play here. So I

38:03

guess with that in mind, let's start peeling

38:05

it apart. So

38:08

from the PDF, from the actual

38:10

lawsuit, this case is about freeing

38:13

smartphone markets from Apple's anti-competitive and

38:15

exclusionary conduct and restoring competition

38:17

to lower smartphone prices for consumers,

38:19

reducing fees for developers, and preserving

38:22

innovation for the future. And

38:24

so like here, okay, I

38:26

don't know that Apple has a monopoly

38:28

on smartphones, but okay, sure. Presumably

38:30

the document will get to that

38:32

eventually. Yeah, presumably. But

38:35

in principle, anti-competitive and

38:37

exclusionary conduct, yup, okay, restoring

38:40

competition to lower smartphone prices for consumers,

38:42

like I don't see that happening, but

38:44

okay, sure, I mean, I guess that

38:46

sounds good. Reducing fees for developers, okay,

38:48

yeah, you've got my attention now. And

38:50

preserving innovation for the future. I'm

38:53

not sure this is the right vehicle for that, but

38:55

okay. But it's a vague enough goal, you can

38:57

say, okay,

39:00

so again, tell me how

39:02

this lawsuit is going to do that. What's

39:04

wrong, what, and speaking of the

39:06

stuff in the document, a part of what I

39:08

was thinking, again, not being a lawyer, is like,

39:12

they have to show that Apple

39:14

violated some existing law. And

39:17

so I have to think that

39:19

the things that they picked, and we'll get to the

39:21

items that they picked to sort of highlight as examples,

39:23

are focused on the things they think

39:25

are violations of some existing law, and

39:28

are not actually like kind of like

39:30

the EU would focus on, what are the things

39:32

that are the most unjust or the most anti-competitive?

39:34

This doesn't really matter what is unjust,

39:36

or what is anti-competitive or what just feels wrong.

39:39

It only matters what you can prove is a

39:41

violation of an existing law. That's, again, that's the

39:43

big difference between this and the EU thing. They're

39:45

not making up new rules. They're saying, we

39:47

have existing laws, and we have to prove

39:50

Apple violated one of our existing laws. And

39:53

there's ample case precedent about what constitutes a

39:55

violation of the law and what doesn't. So

39:57

they have to pick things that's presumably as

39:59

law. If you want to run the case and you

40:01

say they broke this law, this section of this law,

40:04

you better have things that are going to

40:06

show that they broke that and those may

40:09

be dumb things because again, the

40:11

law is not tailored to deal with the

40:13

smartphone market. It was for standard oil, right?

40:15

It's not ... I actually looked

40:17

up the Sherman Antitrust Act and looked at section

40:19

two that they say they violated and it was

40:21

not eliminating. As you would imagine, there

40:24

wasn't a lot of text and there wasn't a lot ... I'm like, this is

40:26

it? There was section two of the

40:28

Sherman Antitrust Act and I'm like, well, I ... Anyway,

40:31

obviously just because that was the words in the

40:33

law, there's been so many cases that have been

40:36

based on that law that there's precedent and it's

40:38

complicated, right? I trust lawyers to

40:40

do that, but being

40:42

hemmed in by having to show

40:45

that they violated this specific existing law because

40:47

it's the only one that's even remotely applicable

40:49

makes this whole thing just so much more

40:52

stupid, frankly. Here

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42:57

So it continues not directly. This is later on

42:59

in the document. The iPod

43:01

experience gave Apple a recipe for the future,

43:03

a high-end device, a large number of platform

43:05

participants, i.e. music labels and consumers, and

43:08

a digital storefront. More importantly, gave Apple

43:10

a playbook, drive as many consumers and

43:12

third party participants to the platform as

43:14

possible and offer a wide selection of

43:16

content, products and services created by those

43:18

third party to consumers. This

43:20

structure put up on the driver's seat to

43:23

generate substantial revenues through device sales in the

43:25

first instance and subsequently the ancillary fees

43:27

that it derives from sitting between customers on the

43:29

one hand and the products and services they love

43:31

on the other. Doesn't that just

43:33

mean they've succeeded by making a good

43:36

product that people wanted? Yeah,

43:38

well, we'll get to that in a little bit. But

43:40

like there's a lot of sections of this this complaint

43:42

that read like a book report, a book report about

43:44

the tech industry and it should get like a C

43:46

minus. Not

43:48

well researched and is wrong

43:52

about the facts in several cases

43:54

and draws completely ridiculous conclusions that

43:56

are not supported by any of

43:58

the evidence. Again,

44:00

I don't know how legal complaints are written. Maybe that's

44:02

just a thing you do as like background context or

44:04

whatever Because the complaint is not the

44:06

court case. They'll go to court lawyers will argue things

44:08

They'll talk, you know, like that'll happen right? So I

44:10

don't understand like what are you supposed to

44:12

put in the complaint? but there's a lot of book

44:14

report style like table-setting and background

44:16

and stuff and just lots of stuff in there

44:18

is like If I had if I was

44:21

Apple's lawyers and I saw this again Maybe

44:23

they don't have to address this in the court cases

44:25

I don't know how things work like just as a

44:27

person who knows the tech industry I'm like, nope, that's

44:29

not not a thing. Not it. We'll get to them.

44:31

We should keep going Yeah So today

44:33

only Apple and Google remain as meaningful

44:35

competitors in the US performance smartphone market

44:37

We'll get to that in a second

44:39

barriers are so high that Google was

44:41

a distant third tap on Samsung Despite

44:43

the fact that Google controls the development

44:45

of the Android operating system I pulled

44:47

this bit out because it is an

44:49

example of a very confused understanding modern

44:52

market in the United States Only

44:55

Sam's talking Google remain as meaningful competitors Like

44:58

what we all know on this podcast and anyone who's in

45:00

the tech world is what you know

45:02

Who controls the smartphone world? The

45:05

answer is Apple and Google the plot

45:07

the two the only two platforms that

45:09

matter in the smartphone world Android

45:11

which is controlled by Google and

45:13

iOS which is controlled by Apple and Maybe

45:17

regulators confused like but wait a second Google's is open

45:19

source and lots of people use it in it and

45:21

Google's ink doesn't control them above a lot Well, there's

45:23

a whole other court cases about how Google actually does

45:25

kind of sort of manage to control the people who

45:27

use Android despite The fact that it's open source and

45:29

through the Google Play store involved, but like to

45:31

a first approximation smartphone

45:34

Apple and Google right, but

45:36

this thing is like, you know,

45:38

Google is a distant third to

45:40

Samsung Samsung Like I

45:43

know that like they're saying they're saying in terms how many

45:45

phones do you sell Google doesn't sell a lot of phones

45:47

This way the fact that pixels are good. Like they don't sell

45:49

a lot of them I understand how they came to this

45:51

but in an antitrust suit

45:55

I think one of the main things that they never touch

45:57

again, maybe for legal reasons because it doesn't help their case

45:59

or whatever is that Google

46:02

is the other big company in

46:04

the smartphone world. There are two

46:06

big smartphone platforms, Apple's and Google's,

46:08

and Samsung sells a lot of

46:10

phones based on Google's. I

46:12

understand that technical nuance there, but I

46:14

read this paragraph and I

46:17

would say for a little Timmy, like, turning this

46:19

into a book report, it's like, you're

46:21

right about the number of phones sold and the

46:23

company that makes those phones, but you're not seeing

46:25

the forest for the trees here. And

46:28

again, maybe Google is irrelevant to the suit because this

46:30

is not a suit against Google, it's just against Apple,

46:32

but they do all this sort of background information. By

46:34

the way, why isn't it also against Google? Well, it's

46:36

a good question. Well, I think I kind of know

46:39

the answer to that too, which we'll get to in

46:41

a second, but this does just one excerpt. I have

46:43

so many excerpts that I pulled, probably I can't do

46:45

them all, but we'll get to them eventually. So the

46:48

DOJ had a press conference about this, where people

46:50

got up at a podium and talked about things,

46:52

right? And there is a transcript

46:55

of, I believe, just the prepared remarks of

46:58

the press conference. I'll put a link to it in the show notes. A

47:01

few things that were in the press conference, which

47:03

at that point I hadn't read the entire complaint

47:05

yet. So I was

47:08

going by what they said, and I was like, what,

47:10

so what, like, why are they, what, why

47:12

are they suing Apple? What is this under? And the person

47:14

at the podium, I believe it was the

47:17

Attorney General, Merrick Garland, said there, it's for violating

47:19

Section 2 of the Sherman Anti-Trust Act. So it's

47:21

clear, that's what this is about at the Anti-Trust.

47:23

It's Section 2, you can look it up. And

47:27

they also mentioned that Apple has over

47:29

65% of US smartphone, of the US smartphone market.

47:32

Right. And, and I was like,

47:34

okay, but like, so surely, like, the

47:37

last, again, the last time we had a

47:40

big DOJ anti-trust thing against Microsoft, it

47:43

wasn't because Microsoft had 65% of the PC

47:45

market, right? That number seems low, right?

47:48

But I'm sure they'll support it in the document. But anyway,

47:50

Merrick Garland is up there. Here's some more things that he

47:52

said, again, US Attorney General said, the

47:54

Supreme Court defines monopoly power as,

47:57

quote, the power to control prices.

48:00

or exclude competition. As

48:02

set out in our complaint, Apple has that

48:04

power in the smartphone market. Okay, I mean,

48:07

I'm not a lawyer, so maybe that is the standard

48:09

in the US is just the power to control prices

48:11

or exclude competition. I

48:14

guess they'll talk about that in the document. Now

48:17

this is the key part we were getting from

48:19

before. Having, this is Merrick

48:21

Arlen continuing, having monopoly power

48:23

does not itself violate the antitrust laws,

48:25

but it does when a firm acquires

48:28

or maintains monopoly power, not because it

48:30

has a superior product or superior business

48:32

acumen, but by engaging in exclusionary conduct.

48:35

As set out in our complaint, Apple has maintained

48:37

its power, not because of its superiority, but because

48:39

of its unlawful exclusionary behavior. So that is the

48:41

key. That's why I think the headline is crappy.

48:43

US use Apple for illegal monopoly? Monopolies

48:45

are not illegal in the US. You can

48:48

have a monopoly. It's fine. There's no such

48:50

thing as an illegal monopoly. There is such

48:52

thing as using your monopoly to illegally stop

48:54

people from competing with you, and that's what

48:56

this is about. And there are two

48:58

parts of that. One, you have a

49:00

monopoly, and presumably the US has

49:02

to show that's the case, and that's where they're

49:05

going like, oh, how do we define monopolies because

49:07

X, Y, and Z? And two, okay, you got

49:09

that monopoly, which is fine. Did you use that

49:11

monopoly to exclude competition in ways

49:14

that are against the law according to all

49:16

of our legal precedents? Right? And that's what

49:18

the DOJ case against Microsoft was about, and

49:20

that's what this is about. It's not

49:22

about it's illegal to have a monopoly. It's you've got

49:24

a monopoly, and you used it in a way that

49:27

you're not allowed to, right? Because basically what

49:29

it comes down to is if you have a monopoly, different

49:32

rules apply to you. And that's

49:34

why in a lot of these cases, people, especially people

49:36

in the US will get indignant, they'll say and Carter

49:38

Marker was getting at it before like, aren't

49:41

you just complaining that Apple is too good at their

49:44

job? I get that they're too good at business, right?

49:46

They're doing all these things and you may not like

49:48

it. But like, that's business like they're

49:50

competing. This is what got them to where they are.

49:52

Now you're saying they can't do it. And the answer

49:54

according to US law is yeah, if you get game

49:57

and not become a monopoly, if you gain monopoly, you gain

49:59

monopoly. monopoly power, you have a different set

50:01

of rules that apply to you. Things that

50:03

were fine for you to do when you

50:05

were a little company, when you were a

50:07

monopoly, those exact same things become illegal when

50:10

you are a monopoly. So showing that Apple

50:12

is a monopoly is a really important part

50:14

of this case because if Apple was a

50:16

tiny little company and not like the biggest

50:18

company in the US, every

50:21

single thing we talk about and the things we complain about

50:24

on the show and things we always complain about on the

50:26

show is like, well, we don't like it, but it's not

50:28

like it's illegal or anything. They're just kind of being jerks

50:30

or they're doing things that are not in their interest or

50:32

they're annoying us as developers or whatever. But this antitrust law

50:34

says when you are a monopoly, there

50:36

are a bunch of things you can't do. And that

50:38

is the US centric context

50:40

of this entire thing. One

50:43

more bit. This is not from the Merrick Garland

50:45

business from the complaint itself. It

50:48

says, plaintiffs bring this lawsuit under section

50:50

two of the Germany interest act to

50:52

challenge Apple's maintenance of its monopoly over

50:54

smartphone markets, which affect hundreds of

50:56

millions of Americans every day. This is as close as

50:58

I could find in the complaint to

51:01

the government acknowledging

51:03

a fact that I think is

51:06

important, maybe not to this case, but is important to

51:08

this situation because again, what's

51:10

important to this case just determine is based

51:12

on the law and a lot of our

51:14

laws are dumb or not applicable or never

51:16

envisioned in the situation they're being applied to.

51:18

Right. But the bigger

51:21

picture, as I've said in many times is like, I

51:24

think setting aside US laws, that

51:26

one of the reasons why a different set

51:28

of rules should apply to Apple and Google

51:31

is because as the States, hundreds of

51:33

millions of Americans have smartphones, like it

51:35

is not like an optional thing or

51:37

a frivolous thing

51:39

like a game console or whatever. You

51:42

can get by as an adult in

51:44

America without a game console, but

51:46

it is very difficult to get by these days as

51:48

an adult in America without a

51:50

smartphone because so many parts of

51:53

business and job and everything assume

51:55

you have one and if you don't, it

51:57

is a hindrance, kind of like the telephone, right? There's

52:01

no law that says you have to have

52:03

a telephone, back before cell phones, like a

52:05

landline telephone, but at a certain point, if

52:07

you didn't have a telephone, it would really

52:09

impair your ability to participate in society and

52:11

be a functioning person. It's like the bar

52:13

for what you need to have

52:15

in society gets raised. And it's not illegal not

52:17

to have a phone, it's not illegal not to

52:19

have a landline, you know, it's not illegal

52:21

not to have all sorts of things, but so

52:24

many people have them that the phone,

52:27

I think, should be treated differently

52:29

than a game console or

52:31

something like that, right? That's not part of this lawsuit,

52:33

there's no part of the Sherman & Tress Act that

52:35

says, oh, if you sell something that everybody needs, it's

52:37

different, right? But I think it

52:39

should be different, and this is one little bit

52:42

of lawsuit that leans in that direction, but unfortunately,

52:44

that's irrelevant because it's not like that, we don't

52:46

have any laws in the US that say, if

52:49

you sell something that's like super important that

52:51

everyone kind of needs, a different set of

52:53

rules apply to you. The EU is essentially

52:55

saying that by saying we regulate

52:57

all sorts of things, but we find it

53:00

particularly important or interesting to

53:03

regulate the smartphone market because

53:05

smartphones are so important to our modern lives,

53:07

that's why we in the EU

53:09

are deciding that we should turn our attention

53:11

to that and not turn

53:14

our attention to, you know, something

53:16

that is not as significant to daily life

53:18

or whatever. And

53:21

so that's why I pulled that little thing out of there. Speaking

53:24

of the Microsoft DOJ trial, at one point back

53:26

to the people standing up at podiums, I think

53:28

this is Jonathan Cantor, who I think is like

53:30

the head of antitrust division of

53:32

the DOJ or whatever, said

53:35

this at the podium, he said, I'd wager that

53:37

everyone in this room has a smartphone. And

53:40

that reminded me a lot of during the

53:43

Microsoft antitrust trial, at

53:45

one point, I think this was

53:47

literally during the trial, like the

53:49

prosecutor said, everyone in

53:51

this room who has a Windows PC raise your hand. And

53:54

it's a giant audience of people, reporters, the

53:56

audience, people who govern people, everybody

53:59

raised their hand. 90s, okay? Who

54:01

has a Windows PC in a giant court

54:03

room during the... Everybody has a Windows PC.

54:05

Of course everyone has a Windows PC. They

54:07

had like 90 something percent market share. I

54:09

would not be surprised if there was like

54:11

one Mac user in that room of like

54:13

300 people, right?

54:15

And it's not... Again, it's

54:18

a court case. You can showboat or whatever,

54:20

but raise your hand if you have a

54:22

Windows PC, all the hands go up. Like,

54:24

yes, as part of the MSDOJ trial, the

54:26

government had to prove that Microsoft was in

54:28

a monopoly. But let me tell you, it's

54:30

pretty easy to do. Like, in

54:32

the 90s, people who weren't alive then

54:34

or didn't... weren't involved in the tech

54:36

sector, did not realize how dominant Windows

54:38

was at that point. Windows

54:41

was everywhere. Everyone had a Windows

54:43

computer, right? This is not saying

54:45

raise your hand if you have an iPhone. This was, who

54:47

here has a smartphone, which is getting to my earlier point

54:50

which is like, look, we all... Everyone

54:52

has a smartphone. He didn't even ask them to raise

54:54

their hand. He just said, I assume everyone's room has

54:56

a smartphone. I agree. I think everyone in the room

54:58

did have a smartphone because it's just something that everyone

55:00

has to have. And another point from the podium, he

55:02

said, roughly seven out of

55:04

10 smartphones or iPhones. So they went from 65%

55:07

of US market share to the seven out

55:09

of 10 number, which is what they were

55:11

saying. Well, in the performance smart... smartphone market

55:14

share or whatever, Apple has even

55:16

more, right? Still kind

55:18

of fuzzy thinking from my point of view. It's

55:20

like, okay, well, is there some percentage of market

55:22

share you need or is it not about market

55:24

share? Is it about how much money goes through

55:26

the thing? Or is it just about the ability

55:28

to exclude competition and control prices? This

55:30

will all be hashed out in the court case.

55:32

But I feel like just from the day

55:35

of dropping this complaint, it's not clear to me

55:38

that the government has

55:40

a bumper sticker

55:42

they can put on that says, here's why Apple's a

55:44

monopoly. Other than like everyone

55:46

has a smartphone, Apple makes a smartphone, something,

55:49

Samsung, Google monopoly.

55:53

Yeah, I don't, it's hard for

55:55

me to not get distracted when I

55:58

read this complaint or the very... coverage

56:00

of it by little details of like, wait,

56:02

that doesn't sound right, or wait, that

56:04

shouldn't be illegal, or that's common sense

56:06

that how every, you know, well-designed

56:09

or well-thought-out product should be, or that thing that

56:11

they're saying Apple's doing, yeah, of course they're doing

56:13

that. That's what makes it good, or that's what

56:15

– that's their prerogative to do or things like

56:18

that. But I'm trying to

56:20

take a broader, higher-level view of this. First of

56:22

all, I am not a lawyer. I

56:24

don't study the law. I barely even had time

56:27

to read this because I also happen to be

56:29

moving today, so it's been a bit of a

56:31

busy day, so I apologize. But it's

56:34

important for me to keep reminding myself what

56:37

they've laid out here is not

56:40

a complete version of

56:42

what they have. It's not a complete

56:45

story that's meant for necessarily people like us. What

56:48

they've laid out here is a strategy. They've

56:50

said everything they've said. They've used the words

56:52

they've used – they've chosen very carefully as

56:55

a legal strategy. What they're

56:58

trying to do is achieve a

57:00

certain set of goals, and

57:02

they're trying to fit the

57:05

law, the precedent, and everything into supporting

57:07

their goals. And

57:09

so all the arguments they've – they're

57:11

making, all the choices of how they've

57:13

chosen to phrase things, what evidence or,

57:15

quote, evidence they've chosen to cite, all

57:18

of that is legal strategy to

57:20

achieve the actual goals. I

57:23

mean, it's a little hard to tell what specifically

57:25

the actual goals would be – Well, the goal is

57:27

simply – you just said it. The goal is to

57:29

win the case, and that's part

57:31

of the problem. Because that's the goal. The

57:33

Department of Justice, their goal is to win

57:35

their court cases. That's their job, their literal

57:37

job. And you say,

57:40

okay, but the court cases are in service of a

57:42

larger goal, right? Like, why

57:44

do they bring this suit? Because they must have

57:46

some larger goal in mind. And in the end,

57:48

the larger goal doesn't really matter because it's not

57:50

like by winning the suit they get to dictate

57:52

exactly what Apple has to do. They can suggest

57:54

remedies, but what's actually going to happen, especially if

57:56

they're like, settled or whatever, it's just – it's

57:59

the wrong way. to go about bringing

58:02

about change. If the

58:04

government has ideas about how this situation could

58:06

be improved, they can pass new laws. They

58:08

can pass new – it happens all the

58:10

time. Hey, companies should not be dumping toxic

58:12

waste into the river. What can we do

58:14

about that? Can we sue them for violating

58:17

some existing law that we think they vaguely

58:19

might be violating? No. Pass

58:21

a new law that says you can't dump

58:23

toxic waste into the river. That's the solution.

58:25

The solution is not to say, well, technically they're

58:27

violating this law of like – they're

58:30

in violation of the Constitution because they're stopping

58:32

people from their pursuit of happiness. No, just

58:34

pass a law that says you can't dump

58:36

toxic waste into the river. That's the solution.

58:38

But we're so bad at passing laws, and

58:40

apparently so is the EU, that that is

58:42

not what we're doing. Instead, we're going to

58:44

sue them under the Sherman Antitrust Act because

58:46

if you squint, it's like they're buying

58:49

up the entire supply chain so that no

58:51

one can compete with them except for Google,

58:53

who has more market share, but I don't

58:55

know. Well, and

58:57

the thing is like – and I think

59:00

obviously the Sherman Antitrust Act is the tool

59:02

we have in the US to deal with

59:04

monopoly behavior. And so

59:06

again, I'm sure there's a lot of legal

59:08

strategic reasons for this, but what

59:11

I've heard a lot of other people report on,

59:13

who know more about this, is that obviously a

59:15

lot of the success or

59:17

failure of antitrust cases in the

59:19

US relies on the market definition.

59:21

And what they have done here

59:23

is try to define this

59:26

like premium smartphone – Performance smartphone.

59:28

That's right, performance smartphone

59:32

market as a separate market from all smartphones. I

59:35

actually like a lot of

59:38

their arguments in it that said basically like

59:40

it's a little bit different from other

59:42

market definitions in the sense that when

59:45

people buy the phone, they're

59:48

buying it for reasons like

59:50

the camera, the specs. They're

59:52

buying it for reasons other

59:54

than the parts

59:56

where they're being accused of being anti-competitive like

59:59

App Store. or private APIs, stuff like

1:00:01

that. So I

1:00:03

kind of get that argument.

1:00:06

It's not a terrible argument.

1:00:09

What I hope to see here, I don't

1:00:12

know their chances of winning this case.

1:00:15

I don't know the law enough and the

1:00:17

tricks and the details enough to be able

1:00:19

to make any kind of call. I don't

1:00:21

know how good their chances are. They're

1:00:24

very smart people. They probably think they have a

1:00:26

pretty good chance, otherwise they wouldn't have brought it.

1:00:28

Yeah, they said on the podium essentially the DOJ

1:00:30

wins most of the cases it brings because it

1:00:32

doesn't bring cases unless it's pretty sure it can

1:00:34

win them. So I would trust them on that

1:00:36

that if you're going to place betting odds, will

1:00:39

the verdict come in favor of the DOJ,

1:00:42

especially on the initial one before appeal?

1:00:44

Like their odds seem reasonable based on

1:00:46

historical precedent. And I don't know

1:00:48

how much of it is also like can they –

1:00:50

maybe they'll just win part of it and win

1:00:52

some claims or some remedies. I'm

1:00:55

sure this is going to be hashed out over a while,

1:00:57

but however

1:00:59

they have chosen to wedge their

1:01:02

arguments into the existing legal frameworks that

1:01:04

they have to use, I

1:01:07

do agree that Apple

1:01:11

does engage in a lot

1:01:13

of anti-competitive behavior and

1:01:15

that Apple has a scale and an importance

1:01:18

in the market and to so much

1:01:20

of commerce and so much of modern life, as you were

1:01:22

saying earlier, John, with everybody having a smartphone. And

1:01:25

I've said over the years, I've said many times,

1:01:27

I do think this

1:01:29

is very different from a game console just

1:01:31

because of how much of modern

1:01:33

life and commerce runs

1:01:36

through this gatekeeper. And

1:01:39

that's why I don't object at all to

1:01:41

the EU DMA kind of focusing on this

1:01:43

idea of a gatekeeper and basically making a

1:01:45

lot of the targeted at only a very

1:01:47

small number of companies because it does

1:01:50

control and restrict so much

1:01:52

of modern life. That is

1:01:54

exactly the sort of thing that

1:01:57

regulation is made for. ostensibly

1:02:01

usually to protect consumers or

1:02:03

markets or the environment or

1:02:05

something else from what capitalism

1:02:07

would normally kind of do naturally. Yeah, what would

1:02:10

be in the self-interest of the company if their

1:02:12

goal is to just make more money? It's way

1:02:14

cheaper just to dump your toxic waste into the

1:02:16

river than to have to pay lots of money

1:02:18

for someone to ship it away and safely dispose

1:02:20

of it. And so without that regulation, a company

1:02:22

with a soulless evil company that just wants to

1:02:24

make money, they're going to say, yeah, just dump

1:02:27

it in the river. Why would we

1:02:29

do anything different? And that's what you bring the regulation

1:02:31

and it says, they're just being

1:02:33

a smart company. They're saving money. They're increasing

1:02:35

profitability by not paying those expensive fees to

1:02:37

dispose of toxic waste. That's

1:02:40

what regulation is for. And so yeah, that would be

1:02:42

a much better tool to do this. And it's what

1:02:44

the EU is trying to do. But in the US,

1:02:46

that's not how we've chosen to do it for the

1:02:48

second time. Yeah. And also, you

1:02:50

can look again at things like the

1:02:52

phone networks, like the original, the

1:02:54

landline phone networks and how government

1:02:57

regulation was required there to ensure

1:03:01

good competition and use of those

1:03:04

lines because the phone networks, while

1:03:06

they were built by private companies,

1:03:08

became so important to modern life

1:03:10

and to everything in modern life

1:03:12

that it was in the best

1:03:14

interest of everybody, the whole society,

1:03:16

to have some basic regulations

1:03:19

on how those were used so that

1:03:21

the very small number of companies that

1:03:23

built them couldn't dictate modern life. Look

1:03:25

also at the railroads, similar

1:03:27

problems. And this is

1:03:29

why these mechanics exist. And

1:03:32

if you look at Apple, their

1:03:34

size today, they are so big,

1:03:37

they are so important to so much of the

1:03:39

world and so much of commerce and so much

1:03:41

of society, they

1:03:44

do need to have

1:03:46

governments looking at them for regulation

1:03:48

because the governments, because of Apple's

1:03:50

size and influence over so much,

1:03:53

governments should be holding

1:03:55

Apple responsible for making sure they use

1:03:57

their power in a way going

1:04:00

to really damage commerce, the

1:04:02

economy, companies, et cetera. A

1:04:04

lot of this complaint, I think, reads very poorly to

1:04:06

those of us watching it because we look at it

1:04:08

and say things like I was saying earlier, like, well,

1:04:11

this thing that they're being accused of, that's

1:04:13

just making a good product. Why should that

1:04:15

be illegal? And to

1:04:18

a lot of extent, I believe that,

1:04:21

but you can also look at a lot of

1:04:23

Apple's behavior over the last decade and

1:04:26

you can see a lot

1:04:28

of anti-competitive, and also I

1:04:30

would say needlessly

1:04:32

anti-competitive behavior that

1:04:35

really just comes down to

1:04:37

greed or just extracting whatever

1:04:39

they can, which itself is

1:04:41

not necessarily inherently illegal, but

1:04:44

again, once you reach a certain scale, tighter

1:04:47

standards have to be applied to you for

1:04:50

the good of the entire economy. So I

1:04:52

do believe Apple has reached that scale

1:04:55

and that they still are doing

1:04:57

certain anti-competitive behaviors that warrant government

1:04:59

intervention. So even though I disagree

1:05:02

with a lot of the specifics

1:05:04

and the examples, they say I

1:05:06

think that what the DOJ

1:05:08

is getting at has a decent

1:05:10

amount of merit and maybe

1:05:12

the reason their arguments seem a little

1:05:15

bit absurd at times is because they're

1:05:17

trying to wedge the current situation

1:05:20

into these very old laws that have a

1:05:22

hard time directly applying. Yeah, that's because everything

1:05:24

you just mentioned is not in the Sherman

1:05:26

Anti-Trust Act. There's nothing in the Sherman Anti-Trust

1:05:28

Act that says if the thing you supply

1:05:30

is used by most of the population and

1:05:32

is required to be a part of daily

1:05:34

life, that's not in the Sherman Anti-Trust Act.

1:05:37

It's very succinct and to the point and

1:05:39

does not make any distinction between like, well,

1:05:41

what if you make a game console, how

1:05:43

important is your product to society, how big

1:05:45

are you as a company in terms of

1:05:47

like it's not about that. It's

1:05:49

much simpler and everything, all those nuances that

1:05:51

are about that have been established by case

1:05:53

law and the case law leading up to

1:05:55

this, including very recently with Microsoft, has

1:05:58

not really made that distinction that we're making

1:06:00

here that it's like it really does and

1:06:02

make a difference whether you make

1:06:04

a smartphone or a blender. Every

1:06:10

adult in America doesn't need to have a blender to

1:06:12

be able to function well in society, but a smartphone

1:06:14

is just like a landline phone

1:06:16

used to be. It's so necessary that we

1:06:19

feel here on the outside of the legal

1:06:21

system, it's like it makes sense to give

1:06:23

that more scrutiny. It makes sense to apply

1:06:26

different rules to that. But to

1:06:28

win the legal case, if that's not

1:06:30

in the law, there's no point in

1:06:32

bringing any of that up in the court case. They could have

1:06:34

run it up in this document because lots of random crap is

1:06:36

brought up in this document, so I'm kind of disappointed not to

1:06:38

see it here. But when it comes to proving they violated the

1:06:40

law, I'm not sure. I mean, they can

1:06:43

make that case. They can say, well, judge, that's how

1:06:45

precedent gets set. Well judge, even

1:06:47

though Apple only has 60% market share, it's

1:06:49

so important to have a smartphone and they do

1:06:51

make the point in the document that it sounds

1:06:53

silly to us, again, the tech world, but they

1:06:55

make up this term for it everywhere. They hold

1:06:57

multi-homing or something. They're like, look, people don't use

1:06:59

more than one smartphone. They either have an

1:07:02

Android phone or an Apple phone, but

1:07:04

they tend not to have both of them. So

1:07:06

basically, they're basically saying like, if you make an

1:07:08

app and you want to address the entire addressable

1:07:11

market for smartphone users, like if you're a DoorDash

1:07:13

or Uber or something, you have to be on

1:07:15

Apple's platform. Even though Apple only

1:07:17

has 65% market share, because

1:07:20

people don't own two phones, you

1:07:22

can't expect if I just make it for

1:07:24

Android, everyone will be able to use Uber,

1:07:26

right? You have to make it

1:07:28

for both platforms. It's a weird way of getting at

1:07:30

the point of like saying, look, there's essentially a duopoly,

1:07:32

but we don't really have any laws about duopolies. And

1:07:35

a duopoly in something that's important in the smartphone

1:07:37

is arguably worse than having a monopoly because they

1:07:39

can both point to each other and say, see,

1:07:41

there's competition, which they absolutely will do in the

1:07:43

court case, I'm sure. Our

1:07:46

laws are insufficient to capture the moment,

1:07:48

but DOJ is going

1:07:50

with the laws they have, and I guess

1:07:53

trying to win based on those things. And that's why

1:07:55

a lot of this does not

1:07:57

ring true to us. So I agree with Marc.

1:07:59

I feel that something needs to be done, but

1:08:02

I look at this complaint and I'm like, yeah, this is not it.

1:08:06

This is not what needs to be done because

1:08:08

it necessarily can't get at the

1:08:10

heart of the problem. It has to instead

1:08:12

prove that Apple violated this law. And

1:08:14

that's, you know, so I hear

1:08:16

it. They gave five examples and they were clear in

1:08:19

the complaint. They said, this is not exhaustive. These are

1:08:21

not the only things that we're saying Apple did that's

1:08:23

bad. I'm sure the court case will, the government will

1:08:25

roll out many, many things that I think Apple did

1:08:27

that was bad. Right? They

1:08:30

gave five specific examples and they're

1:08:32

so weird. So here we go. Here

1:08:35

we go. Disrupting quote unquote super apps

1:08:37

that encompass many different programs and could

1:08:39

degrade iOS stickiness and make it easier

1:08:41

for iPhone users to switch to competing

1:08:44

devices. Wait, what is this? I

1:08:46

love it. All right. So maybe this is a term of art

1:08:48

that I don't know. So bad on me for not being familiar

1:08:50

with the term of art about super apps. But I didn't notice

1:08:52

either. If you're, if you're listening to this and you think I've

1:08:54

never heard of a super app, once we start naming examples, you're

1:08:56

going to be like, Oh, I know what that is. I just

1:08:59

never heard of referred to as a super app. Yeah.

1:09:02

So what they define a super app is a

1:09:04

super app is an app that can serve

1:09:06

as a platform for smaller mini programs developed

1:09:08

using programming languages such as HTML five and

1:09:10

JavaScript super apps can provide significant benefits

1:09:12

to users. For example, a super app that incorporates

1:09:14

a multitude of mini programs might allow users to

1:09:16

easily discover and access a wide variety of content

1:09:19

services without setting up and logging into multiple apps.

1:09:22

Not unlike how Netflix and Hulu allow users to

1:09:24

find and watch thousands of movies and television shows

1:09:26

in a single app. So I

1:09:28

think what they're actually referring to though, is WhatsApp, isn't

1:09:30

it? Oh, we chat. Oh, I'm sorry.

1:09:33

Yes. But basically, here's what I

1:09:35

was talking about. Anytime we've ever talked about like

1:09:37

app store rejection and stuff like that, where some

1:09:39

person wanted to make an app and then inside

1:09:41

the app, there was like a little miniature store

1:09:44

where you could buy a bunch of individual like

1:09:46

sub games, like Roblox, but those aren't games. Those

1:09:49

are experiences. It's fine. Roblox is by

1:09:51

the way, a pretty good thing to bring up here. Yeah, I think

1:09:53

it will. I'm pretty sure it'll be brought up. Right. But

1:09:56

anyway, Roblox is allowed. Like things

1:09:58

like WeChat, like WeChat. understanding

1:10:00

is in China you get WeChat and you can

1:10:02

do so much stuff from that. You can get

1:10:04

a taxi, you can pay for your meal, you

1:10:06

can pay your electric bill, like it's all inside

1:10:08

one super app, right? Now, this

1:10:10

is weird in some ways because,

1:10:13

well, so, it's weird because things

1:10:15

like Roblox exist and sort of are in violation of

1:10:17

the sidelines. And the examples they have, Netflix and Hulu,

1:10:19

you log into your Netflix thing and there's a whole

1:10:21

bunch of things you can watch there within a single

1:10:23

app. Netflix doesn't have to put out a separate app

1:10:25

for each individual show, which sounds dumb to you, but

1:10:27

that's what Apple was making people do for things like,

1:10:31

we'll talk about cloud streaming services, but I think that could

1:10:33

also kind of be under super apps. If

1:10:35

you're inside an app and there's like a sub

1:10:37

store, if it's like another level of abstraction, there's

1:10:39

other things you can do in there, Apple tends

1:10:41

to not allow those unless it feels like it.

1:10:43

But one of the

1:10:45

things they cite is, here's what Apple does

1:10:47

and it's anti-competitive because things like WeChat essentially

1:10:49

can't exist in the US. I

1:10:52

would say, again, as

1:10:55

a consumer looking at this in the big picture, I think

1:10:57

super apps like WeChat are not what

1:10:59

I want. I would much rather

1:11:01

have Android

1:11:04

and iOS with individual apps

1:11:06

for all of those things competing in sort

1:11:08

of a more fair open playing field. I

1:11:10

do not want one super app where my

1:11:13

phone is just a WeChat device and WeChat

1:11:16

owns every aspect of my life because that's

1:11:18

just another... All you're doing is shifting the

1:11:21

antitrust problem to a different place. That is

1:11:23

not what I think. That's not an example

1:11:25

of competition. But in the US

1:11:27

complaint, they're like, look, Apple doesn't allow these things to

1:11:29

exist elsewhere in the world.

1:11:31

They do exist and even in the US, there are companies that

1:11:33

want to do this and Apple says no. We

1:11:36

think that's stifling innovation. I think

1:11:38

DOJ pick a different example because

1:11:40

all you're doing is setting up

1:11:42

your 2038 lawsuit against the dominant

1:11:44

super app in the US. This

1:11:47

is one area where I think

1:11:49

this is going to be a common theme to

1:11:53

a lot of Apple fans' responses to

1:11:55

these complaints. We actually want

1:11:57

it this way. I

1:12:00

think we're actually better off to not

1:12:02

have these big super apps because all

1:12:04

that does is just create other

1:12:07

monopolies that that just sit above the smartphone and

1:12:09

then can even be Stronger monopolies

1:12:11

because they could make that same super app

1:12:14

for iOS and Android. Yeah All

1:12:16

right. So the next one is related to that Blocking

1:12:18

cloud streaming apps for things like video games that

1:12:20

will lower the need for superior hardware This is

1:12:23

basically saying the cloud gaming services where there's like

1:12:25

a streaming game service like Microsoft's Xbox thing where

1:12:27

the games run in The data center on big

1:12:29

gaming PCs and you stream the input and output

1:12:31

to your phone right and Apple for a long

1:12:34

time has rejected those and It's

1:12:37

I think if this is one of their starter

1:12:39

cases was like look why you're rejecting this Is

1:12:41

there a safety concern? Is there a security concern?

1:12:43

Is it confusing to customers? Are they gonna be

1:12:45

exploited? Like no, no, no No, this is Apple

1:12:47

doesn't want this just simply because first it makes

1:12:49

a little mini store where you can go in

1:12:51

and buy individual Games, which I think is fine

1:12:53

with the concept of gaming's apparently robots can do

1:12:55

it. But those are experiences not games and

1:12:59

second like Like who cares

1:13:01

like the only reason Apple doesn't want this is because

1:13:03

they make so much money with individual native games and

1:13:05

like that's They're like, well if we did this and

1:13:07

we let them in then all gaming on the phone

1:13:10

Oh personally, I think this is wrongheaded because I don't think

1:13:12

streaming gaming would actually dominate I think Apple is another one

1:13:14

of those cases where I think Apple if you actually competed

1:13:16

and allowed this you'd be fine But whatever

1:13:18

they're scared to find out right so they just

1:13:21

said no to this And I think this is

1:13:23

actually a good example of Anti-competitive behavior because they're

1:13:25

gonna be able to say Apple remind me again

1:13:27

why people aren't allowed to do this Like

1:13:30

even if they were willing to pay you the

1:13:32

30% and do whatever it's like No, we just

1:13:34

don't allow things like that in the store Well,

1:13:36

why not and the answer effectively is because we

1:13:38

make more money from the other things. It's not

1:13:41

there's no privacy angle There's no security angle. There's

1:13:43

no like there's no anything. It's just they were

1:13:45

disallowing us And of course they change this rule

1:13:47

very recently say okay, Microsoft You can't remember

1:13:49

that thing we told you you couldn't do for years

1:13:51

you're allowed to do it now, and I think the

1:13:53

reason they changed it is because of you know all

1:13:55

of the Pressure

1:13:58

that the new was going to arrive or was from

1:14:00

the EU or was coming from the US or whatever, they didn't

1:14:02

change that at the goodness of their hearts. So

1:14:04

this is, I think, a reasonable point, although maybe it's undercut

1:14:06

by the fact that Apple already allowed this. But

1:14:09

the historical example, here's the thing that they were

1:14:11

doing to stifle competition. The

1:14:14

next one, I think this is going

1:14:16

to be tough for the government for

1:14:18

a variety of reasons. Suppressing the

1:14:20

quality of messaging between the iPhone platform

1:14:22

and competing mobile platforms like Android, here's

1:14:24

what they mean in the complaint. Because

1:14:28

only messages on the phone

1:14:30

can do SMS that makes it

1:14:32

difficult to use any other third party

1:14:34

messaging platform as sort of your like,

1:14:37

you can do everything. Because the point

1:14:39

of the thing is like if you have to message someone, you can

1:14:41

just go to messages, you type in their phone number and you send

1:14:44

the message. And one or two things are going to happen. Either it's

1:14:46

going to send through SMS, because that's

1:14:48

all they have and it's a common denominator. Or

1:14:50

it will send through iMessage because they have an iPhone. And

1:14:53

their argument is they have a

1:14:55

whole bunch of bogus arguments with the beeper

1:14:57

thing that we've talked about in past episodes.

1:14:59

But their argument is like, no

1:15:01

other third party messaging app

1:15:04

can do that because Apple doesn't allow

1:15:06

third party apps to use the API

1:15:08

for sending SMS messages. They could, they

1:15:10

just don't allow that API. This

1:15:14

whole section drove me nuts. Because

1:15:16

what they're saying, depending on

1:15:19

how you interpret it, is either just straight

1:15:21

up wrong or just a poor way of

1:15:23

describing it. Because the whole point of fast

1:15:26

text, may it rest in peace, was to

1:15:28

send text messages. And there is an API

1:15:30

to do that. Now, I think what they're

1:15:32

saying is there's no mechanism to

1:15:34

go in and have a replacement for the

1:15:36

messages app. There's no mechanism for my app

1:15:38

to become the system SMS app. Which might

1:15:40

not even that. I think that they're saying

1:15:42

you couldn't make a client app. Like a

1:15:44

full, yes, you can send messages, but you

1:15:46

can't basically be a client app that's sitting

1:15:48

there running in the background waiting for someone

1:15:51

to send you a message. And

1:15:53

just being an interactive client, that's

1:15:56

basically, I feel like, what they're saying. Yeah,

1:15:58

there may be an API to send a message. but

1:16:01

there's not enough APIs for

1:16:03

you to essentially write your own

1:16:05

version of messages. Forget about it for replacing it as

1:16:08

a system default. I think that's what

1:16:10

they're saying. I think that's true, right? That you

1:16:12

couldn't write messages yourself, make your own set of

1:16:14

servers, make your own everything, make your own... It's

1:16:16

all your own infrastructure, but just write

1:16:18

an app that looks and feels just like

1:16:20

messages. It's not the default app on the phone, but it

1:16:22

does the same stuff. I don't think that's

1:16:24

currently possible. No, you're right. The

1:16:27

other thing that drove me nuts about this section is

1:16:29

that they were complaining and moaning incessantly about how, oh,

1:16:31

you can't run anything in the background, so you

1:16:34

wouldn't receive your messages in a timely fashion or

1:16:36

whatever. That's also

1:16:38

mostly not true. Granted, it's because

1:16:40

of APNS. I

1:16:42

think I pulled a quote out about that, which

1:16:44

is like, I really want to see

1:16:46

them... This is not maybe what they're going to say in court, but

1:16:48

I really want to see them try to support this statement. Let me

1:16:50

see if I can find it. All right.

1:16:53

Here, this is directly from the complaint. For example,

1:16:56

third-party messaging apps cannot continue operating

1:16:58

in the background when the app

1:17:00

is closed, which in Paris functionality

1:17:02

like message delivery confirmation. Cannot

1:17:05

continue operating in the background when the app is closed.

1:17:07

I don't think there's any way you can interpret that

1:17:09

sentence for it to be technically valid in iOS today.

1:17:13

And then the second part

1:17:15

is, which in Paris functionality like message

1:17:17

delivery confirmation, push notifications exist and can

1:17:19

be used by third-party apps. I swear

1:17:21

they can. You can

1:17:23

get a push notification or like

1:17:26

none of this is true. I don't think any of

1:17:28

this is true. And it is such a

1:17:30

weird thing to be harping on that like third-party

1:17:33

messaging apps can't continue operating in the background. This

1:17:35

is news to every third-party messaging app that does

1:17:37

exactly that and notifies you when people send you

1:17:39

a message. Like I don't, I'm just flabbergasted that

1:17:42

this is in here. It doesn't make no sense.

1:17:44

Like the one point they have is, hey, they're

1:17:46

private APIs. They have to make this point several

1:17:48

times. They're private APIs that Apple keeps to themselves.

1:17:51

And those APIs would be useful to third parties if Apple let

1:17:53

them use them, but they don't. And it

1:17:55

gives Apple competitive advantage because only Apple

1:17:57

can make the app that does. its

1:18:00

own proprietary messaging plus SMS. And

1:18:03

this is a weird thing to bring up

1:18:05

as well, and there are five examples, because

1:18:07

it's not like there's a lack of competition in

1:18:09

messaging apps on iOS. There's a lot of them,

1:18:12

and they're popular. The one strike

1:18:14

they have against them is, I guess, they can't do

1:18:16

SMS. And I

1:18:19

guess there is a point to be made there. I

1:18:21

think they will successfully make that point in the court

1:18:23

case, but it's not one

1:18:25

of their stronger points. So so far, we've got Super Apps, which

1:18:27

I think is wrongheaded and bad.

1:18:30

Cloud streaming, which is pretty good, but Apple's already reversed

1:18:32

that. No SMS use of

1:18:34

API, which I think is just one case of them keeping

1:18:37

APIs to themselves. Maybe they can bring that in that direction.

1:18:40

Again, these are just examples in the document. The

1:18:43

next one is, I think

1:18:45

it gets worse again, limiting the functionality

1:18:47

of third party smart watches with its iPhones,

1:18:50

making it harder for Apple Watch users to

1:18:52

switch from iPhone due to compatibility issues. These

1:18:54

are summaries, essentially. They're

1:18:56

basically saying Apple

1:18:58

Watch can only be used with iPhones, and it's hard

1:19:00

for third parties to make smart watches that can integrate

1:19:03

with the iPhone the way the Apple Watch does. That's

1:19:06

all true. And to

1:19:08

Marco's earlier point, we looked at that and say, yeah,

1:19:12

because they're Apple, and it's their watch, and it's

1:19:14

going to be tightly integrated with their operating system

1:19:16

because they make all of it. What's wrong with

1:19:18

that? And the government's going to say, well, when

1:19:20

you're a monopoly, the rules change for you. And

1:19:22

what would previously have been a smart business move

1:19:25

now becomes illegal because you're not letting other people

1:19:27

compete. But the

1:19:31

example they're going to use is there were smart

1:19:33

watch APIs before the Apple Watch came out, and

1:19:35

Apple essentially just didn't ever improve or expand them.

1:19:37

And Apple Watch got to use its own fancy

1:19:39

APIs. We look at this as Apple fans and

1:19:41

be like, yeah, that's how Apple works.

1:19:44

That's how the tech sector works. They made

1:19:46

those APIs for the Pebble smart watch or whatever

1:19:50

because Apple didn't have its own watch. And then when it made

1:19:52

its own watch, of course you don't get

1:19:54

to use those APIs. Only Apple does. And those APIs are better.

1:19:56

And tough luck because Apple's going to Apple.

1:20:00

I guess the government's going to say that's illegal

1:20:02

because monopoly. Yeah,

1:20:06

that this is a weak one. This this

1:20:08

is why, again, like you can

1:20:10

look at Apple and you can find instances

1:20:12

of anti-competitive behavior, I think fairly easily. But

1:20:15

I think the examples they have chosen

1:20:17

to highlight are not great examples. Like

1:20:19

they seem to be trying to frame

1:20:22

the case against Apple

1:20:24

as Apple makes it too hard

1:20:26

for consumers to switch to Android.

1:20:30

And I don't think that's that

1:20:32

strong of an argument. You can make

1:20:34

lots of other arguments about Apple's anti-competitive

1:20:36

behavior. I don't think that

1:20:38

is a good way to go. But what

1:20:41

I can't tell is like, do they also would

1:20:44

they agree with that? And this is just how they're going

1:20:46

to give it the best chance of winning within the legal framework

1:20:48

that we have. Or is this actually what they're trying to

1:20:50

argue? But they're not. They're not actually they do

1:20:52

a different angle out. They're not actually saying Apple makes

1:20:55

it too hard to switch to Android. What they're essentially

1:20:57

saying in several parts of the document

1:20:59

is they say this change

1:21:01

that Apple made was not

1:21:04

made to make their products better. It

1:21:06

was instead made to demotivate people from

1:21:08

switching. That's subtly different than saying Apple

1:21:10

is stopping you from switching. It's basically

1:21:12

saying, oh, Apple, here's some internal email

1:21:14

that says the reason you did this

1:21:16

is because you were afraid if you

1:21:18

did this, it would there would

1:21:20

be less reason for people to stay on your phone.

1:21:22

Which again, you would look at that and say, isn't

1:21:24

that Apple's job to make their phone the most attractive

1:21:27

platform so people want to stay on it? And you're

1:21:29

saying because they did that, it shows, well, you only

1:21:31

made this change because then people would like the iPhone

1:21:33

better and they would if they left it,

1:21:35

they would miss it because things are only on the

1:21:37

iPhone. And you're like, yeah, that's just business. Isn't that

1:21:40

great? And again, it's saying, yeah, that's great right up

1:21:42

until your monopoly. And so if

1:21:44

you're a monopoly, your knowledge to do those

1:21:46

things. But that's they use that angle constantly

1:21:48

by quoting from emails in the discovery like

1:21:50

the application or whatever is saying, here you

1:21:52

are. Apple saying you're not going to do

1:21:54

this thing that we do. Thanks would benefit

1:21:56

consumers. And the reason you say you're doing

1:21:58

it is because. You're one of your executives

1:22:01

that says, we did this. People

1:22:03

would have less motivation to stay on iPhone. It would

1:22:05

be easier for them to get their kids Android phones.

1:22:08

And that does not look nefarious when I read it

1:22:10

because I understand Apple and how

1:22:12

things work. And a lot of

1:22:14

times, I agree that they shouldn't do that because it would make

1:22:16

the iPhone worse. But the DOJ

1:22:18

comes out and flatly states in his complaint, this

1:22:21

would have been better for consumers. I'm like, already I

1:22:23

disagree with you, DOJ. But anyway, then

1:22:25

they go on and say, and the reason you

1:22:27

did it was to make it harder,

1:22:29

not to make it harder to make it so people don't

1:22:32

want to switch because they switched. They'll be leaving

1:22:34

behind this good thing here. Right? Is

1:22:36

there something only on the iPhone? Oh, well, they even say about

1:22:39

the services, like all these services you have, it makes

1:22:41

it so that if people leave, they're sad because

1:22:43

they're like, oh, but all my things

1:22:46

that I see on this service, I wouldn't have

1:22:48

them anymore for one on Android because it's not

1:22:50

available there. It's it's

1:22:54

so confused when I look at

1:22:56

that and I say Sherman anti

1:22:58

trust act and third party

1:23:00

watches can't integrate with the

1:23:02

iPhone. I'm trying to connect

1:23:04

those dots real hard. It's just not not

1:23:07

working for me. The final one

1:23:09

that had here, which I think maybe is

1:23:11

one of their strongest ones, but it's so dead

1:23:13

simple. And of course, the EU beat them to it

1:23:15

as with all these things. Blocking

1:23:18

third party developers from creating competing digital wallets with

1:23:20

tap to pay functionality. Remember the whole hubbub, I

1:23:22

guess, years ago was like, hey, there's going to

1:23:24

be NFC and Apple phones, but oh, only Apple

1:23:26

can use it for these certain purposes. The

1:23:29

EU, I think already made Apple not do that

1:23:31

anymore and say, hey, it's part of the DNA.

1:23:34

I think, hey, Apple, you have to let third party apps

1:23:36

have access to the NFC thingy so that other

1:23:38

companies can have an app on your phone. So

1:23:40

when you smoosh your phone against the thing, you

1:23:42

can pay with them. But

1:23:45

in the US, I believe it is still the case

1:23:47

that only Apple can access that through their whatever API

1:23:49

is they're protecting. That

1:23:52

is kind of like a level playing field within

1:23:54

the iOS market type of argument of saying There

1:23:57

are features. There are hardware features of the phone.

1:24:00

The you don't let other people use and why

1:24:02

is it because it's better for consumer? The Apple

1:24:04

will. surely. are you that having only a single

1:24:06

lot apis better for consumers to the simplifying yada

1:24:08

yada yada. But the D J's can argue that

1:24:11

it's better. If a Big Apple really is doing

1:24:13

it's basically make sure that all commerce on the

1:24:15

phone goes through them and they get a cut

1:24:17

of it and has nothing to do with simplifying

1:24:19

things for their customers that I suspect a lot

1:24:22

of the the or tickets will be exactly that.

1:24:24

In a not as this point all the Deirdre

1:24:26

saying you're doing is Apple Diggers. He

1:24:29

gives you a kind of all transactions that Apple's I

1:24:31

know we're doing it because having a single law does

1:24:33

that are for consumers simpler. And it's

1:24:36

better for security and yada yada yada

1:24:38

And I think both of those things

1:24:40

are true. It is simpler and easier

1:24:42

for consumers understand and also Apple is

1:24:44

also doing it. So. They can

1:24:46

get a cut of all those transactions like they're

1:24:48

literally both. True, It's not like they're they're not.

1:24:50

The. Not an opposition to each other at all.

1:24:53

Those are two reasons that Apple does it,

1:24:55

and probably equal measure. And neither

1:24:57

one of those reasons is wrong. But the D

1:24:59

O J has through I guess prove that. The.

1:25:02

Money Reason is more important than

1:25:04

the. Be nicer for

1:25:06

consumers Reason. And. Repeat that for all these

1:25:08

points. And it seems so weird

1:25:10

to me that the Deal G really has a

1:25:12

bar up his ass about the fact that people

1:25:14

want to use alternative Zappa wallet in. Who

1:25:17

was like. I. Don't

1:25:20

really get that in. In fact I

1:25:22

would argue that having a that that

1:25:24

compelling all of these different apps and

1:25:26

Ticketmaster and everyone else if is Apple

1:25:28

is even compelling them to add things

1:25:30

into Apple wallets. I'm sure they are

1:25:32

which they i don't know that the

1:25:34

are by would expect that they are.

1:25:36

All sleep with Why is that bad? It's

1:25:39

I see, I see that the education's I

1:25:41

think they have a strong case in terms

1:25:43

of the law. it's going to access the

1:25:45

people who are an Apple nerds. Here's the

1:25:47

deal. Like from our perspective for like this

1:25:49

is a simplification and because we trust Apple,

1:25:51

we prefer the scenario. But from a strictly

1:25:53

business scenario it's basically Apple saying. No

1:25:56

commerce can happen unless we mediated.

1:25:59

of you bank and our phones

1:26:01

have NFC and you would love it if you could

1:26:03

boop and do your bank stuff but we're saying actually

1:26:06

you've got to go through us. I know you're already

1:26:08

a bank but it's got to go through us because

1:26:10

we need to get our cut right and because we

1:26:12

need to have control and Apple would say it's not

1:26:14

because we need to cut it's not because we need

1:26:17

control we do it for security reasons we that's why

1:26:19

Apple pay is better we have these temporary you know

1:26:21

credit card numbers you were just gonna send the same

1:26:23

number constantly back and forth it was totally insecure ours

1:26:25

is better blah blah blah but from a strictly business

1:26:28

perspective it's like they are

1:26:30

basically saying hey you want to you

1:26:33

bank can't have an app that uses our phone to

1:26:35

pay for things you can do it on Android phones

1:26:37

it works fine but here we're saying no everything has

1:26:39

to go through us and for the DOJ case and

1:26:41

I think they're gonna be able to make this pretty

1:26:43

strongly to a non-tech savvy audience is like why does

1:26:45

Apple get it to insert itself there and I think

1:26:47

Apple's obvious claim that this

1:26:49

is a simplification it's better for securities better for privacy may

1:26:51

fall on deaf ears because they're gonna say like yeah that's

1:26:53

exactly what you would say if you wanted to get yourself

1:26:56

between every single transaction and

1:26:58

again I think both are true I think it

1:27:00

is more secure and I do trust Apple more

1:27:02

than a lot of these banks and it is

1:27:04

better for consumers but also Apple does want to

1:27:06

cut of that right both things

1:27:09

are true and I don't

1:27:11

quite see how this is going to how anything

1:27:14

useful is going to come out of this because you

1:27:17

know if you have it if that's if

1:27:19

the government makes this case and the things they're

1:27:21

saying are true and Apple goes on the stand

1:27:24

and things they're saying are also true it basically

1:27:26

comes down to the judge and or jury however

1:27:28

this trial is going to go deciding which one

1:27:30

of those two completely true things is dominates

1:27:33

the other and it really just depends on

1:27:35

are you looking at Apple as a big

1:27:37

evil cooperation are you looking at the government

1:27:39

as incompetent and what if it's

1:27:42

both pork and a list of yes

1:27:44

that's difficult thing and that's why you never

1:27:46

want to leave this up to a freakin

1:27:48

legal case just help again use your words

1:27:51

government right regulation that tells Apple what you want

1:27:53

it to do differently and Google for that matter

1:27:55

because they're kind of important in this scenario so

1:27:58

that anyway I

1:28:01

don't want to pull this one out. Let's go to

1:28:03

Apple's response because I have a bunch of other excerpts

1:28:05

that I want to just do a quick hits on.

1:28:07

But here's Apple's terse

1:28:10

response, obviously the day of this thing coming

1:28:12

out. You want to read this, Casey? Sure.

1:28:15

At Apple, we innovate every day to

1:28:17

make technology people love, designing products that

1:28:19

work seamlessly together, protect people's privacy and

1:28:22

security, and create a magical experience for

1:28:24

our users. This lawsuit

1:28:26

threatens who we are and the principles that

1:28:28

set Apple products apart in fiercely competitive markets.

1:28:31

I like the big thing, the fiercely competitive part. If

1:28:34

successful, it would hinder our ability to create

1:28:36

the kind of technology people expect from Apple,

1:28:38

where hardware, software and services intersect. It

1:28:41

would also set a dangerous precedent, empowering

1:28:43

government to take a heavy hand in

1:28:46

designing people's technology. We believe this

1:28:48

lawsuit is wrong on the facts and

1:28:50

the law, and we will vigorously defend

1:28:52

against it. I think this

1:28:54

is better off being read through gritted teeth. At Apple,

1:28:57

we innovate every day. I

1:28:59

can do that if you like. I can do a second thing.

1:29:01

I feel like this is a canned thing that they have ready

1:29:03

to go. Probably had a ready to go for ages, kind of

1:29:06

like when you're pre-write obituaries. But this is

1:29:08

a tangent, but it's my favorite thing about this. We've

1:29:11

talked many times in the show about how Apple's style guide

1:29:13

wants you to say, like, Apple Vision Pro and not the

1:29:15

Apple Vision Pro, and they want you to say iPhone, not

1:29:17

the iPhone. We believe iPhone

1:29:19

is the best platform for blah, blah, blah. We don't

1:29:21

want you to say we believe the iPhone. That's in

1:29:23

all their style guides. That's the way they do PR

1:29:25

or whatever. So in this statement, they say, it

1:29:28

would also send a dangerous precedent, empowering government to take

1:29:30

a heavy hand. And when I originally read that, I'm

1:29:32

like, did I miss copy and paste this? Shouldn't

1:29:35

it say empowering the government to take

1:29:37

a heavy hand? But no, the government

1:29:39

gets the iPhone treatment. It's called empowering

1:29:41

government, not empowering the government. We don't

1:29:43

say the government. We just say government.

1:29:45

Here at government, we believe Apple. Apple

1:29:48

is an illegal monopoly. I

1:29:50

understand Apple's attitude here

1:29:52

because, look, Apple does

1:29:54

not like being told by external

1:29:56

forces how to design their products.

1:30:00

I mean I can't blame them, I wouldn't

1:30:02

like it either, but the reality is again,

1:30:04

they do actually anti-competitive

1:30:07

behavior all the time

1:30:09

and have for a while that I think

1:30:11

is easily avoided. And they

1:30:13

have brought this on themselves with this

1:30:16

behavior. They have been

1:30:18

so brazen and so

1:30:20

comprehensive with their anti-competitive behavior

1:30:22

over the years that they

1:30:25

have invited governments to,

1:30:27

they've actually, they've effectively

1:30:30

forced governments to try to regulate them by

1:30:33

behaviors that are not core

1:30:35

to their products. By behaviors

1:30:37

like various anti-competitive app store

1:30:39

policies and third party service

1:30:41

policies. They have, if

1:30:43

you look at all that whole area

1:30:46

of their behavior, that has invited

1:30:48

most of this regulation and

1:30:50

most of these lawsuits. And

1:30:52

that has nothing to do with their

1:30:54

products being good and well integrated with

1:30:56

each other and secure and private. They're

1:30:58

using that, and actually the complaint directly

1:31:01

addresses this, they use the security and

1:31:03

privacy angle as an excuse to cover

1:31:05

a lot of behavior and a lot

1:31:07

of times it's warranted because Apple products

1:31:09

really are pretty secure and pretty private

1:31:11

compared to everything else in the industry.

1:31:13

And for the most part we

1:31:15

appreciate that. But they also use that same

1:31:18

cover on

1:31:20

behavior that is not great and

1:31:23

where those are not the reasons for that behavior.

1:31:25

Or very often they are reasons, but they're not

1:31:28

the only reasons. And maybe not even the primary

1:31:30

reason. And that's kind of like what you mentioned

1:31:32

about trusting Apple though. That's part of the

1:31:35

reason why I think this has a strong

1:31:38

chance in a legal setting. We

1:31:41

like a lot of these moves because

1:31:43

we trust Apple more than we trust

1:31:45

some stupid bank for example, right? But

1:31:48

the law is not just the law for Apple,

1:31:50

it's for all companies. So if you say it's legal

1:31:52

for Apple to insert itself, you're not seeing every transaction.

1:31:54

We think that's great because I'd rather have Apple

1:31:56

in there because we trust Apple more. But if

1:31:58

you just remove the name. and just say

1:32:00

anonymous company A, B, and C, do

1:32:03

you want that to stand? Because one of the

1:32:05

companies that's doing this in the middle was, for

1:32:07

example, Microsoft, or whatever company you have less nice

1:32:09

feelings about than Apple. Facebook. Yeah,

1:32:11

exactly, Facebook, right, whatever, right. The

1:32:14

law has to be, you know, whatever

1:32:16

the law, they're not writing laws. This verdict

1:32:18

is going to apply to all companies, not

1:32:20

just Apple. And so while we may actually

1:32:22

prefer Apple to insert itself, because we trust

1:32:25

Apple more, because of their proven track record,

1:32:27

and also because of how Apple makes money

1:32:29

is not the same way that Facebook makes

1:32:31

money, and their incentives are differently aligned, they

1:32:35

have a strong legal case to say, it's all

1:32:37

well and good, because you

1:32:39

like this benevolent dictator, but it should be

1:32:41

illegal for anyone to do that, even though

1:32:43

Apple's being nice about it. I

1:32:46

think they might have a strong case there, as

1:32:48

far as that goes. Yeah, so I think

1:32:51

Joe Rosenstiel retweeted, or

1:32:53

retooted an account, Glyph,

1:32:56

which I'd not been familiar with, but I think

1:32:58

this is a perfect distillation of kind of how

1:33:00

I feel about it. Even if you're

1:33:02

an Apple stan, and think the company really

1:33:04

has no motivation, but a sincere desire to

1:33:06

protect users, and government regulators are bad product

1:33:08

designers, and this will make things worse. Even

1:33:11

so, this is Apple's fault.

1:33:13

The handwriting has been on the wall

1:33:15

for years. They should have figured out

1:33:17

a way to self-regulate by now, but

1:33:19

because the appearance of impropriety clearly exists, and

1:33:21

has now been called out on multiple continents,

1:33:23

this is not one regulator with a bias. I

1:33:25

mean, it's so true. You and the three of

1:33:28

us have been saying this for years. Yeah,

1:33:30

we've talked about it for years. We

1:33:32

said this was gonna happen, and lo and behold, it has. Part

1:33:35

of when we had these discussions years ago, what

1:33:37

I always said is that Apple's calculation is not

1:33:39

that they're going to avoid regulation, but that they're

1:33:41

going to survive it, and it is better to

1:33:44

essentially force it to happen,

1:33:46

and then settle, or essentially, they're

1:33:48

making the calculation that, yeah, we

1:33:50

know we're bringing on the bad thing. We're doing

1:33:52

it to ourselves, but we think in the end,

1:33:54

because we're Apple and we're so huge, that we

1:33:56

will still come out in a more powerful position

1:33:58

than if we were to... to give concessions

1:34:01

manually. I don't think that's true. I think the

1:34:03

reputational damage is what they weren't taking into account.

1:34:06

But that has always been like

1:34:08

a plausible reason that

1:34:11

not that Apple's just dumb and didn't do that. Oh,

1:34:13

they should have self-regulated themselves. Why are they so dumb?

1:34:15

I think they're constantly making their calculation. Like I think

1:34:17

we can, I think we can, I

1:34:19

think we can come out ahead if we just hold

1:34:21

firm, bring on the lawsuits, fight

1:34:23

it in every continent, like just, because that's, effectively

1:34:25

that's what they're doing. And now it's forcing them

1:34:27

to do it. They're choosing to do that. So

1:34:29

their calculation must be, this is actually

1:34:31

the better way to go. Even though there's gonna be short-term

1:34:34

pain and we're gonna look bad, in the end we'll come

1:34:36

out ahead. I don't

1:34:38

think they are gonna come out ahead. I think

1:34:41

it was the wrong choice, but clearly they feel

1:34:43

differently. Yeah. Let me

1:34:45

do my quick hits with these. I don't know how quick they're

1:34:47

gonna be. I'll probably stop eventually, but there's some choice

1:34:50

snippets that I pulled out of the complaint that

1:34:52

I thought were interesting. We already did a couple

1:34:54

of them. This one, I mentioned

1:34:56

Bieber before. I'm not gonna go through it all.

1:34:59

You can go look through old episodes when we

1:35:01

talked about the Bieber thing, but this paragraph is

1:35:03

essentially about Bieber. This is the DOJ saying, recently

1:35:06

Apple blocked a third-party developer from fixing

1:35:08

the broken cross-platform messaging experience in Apple

1:35:10

messages and providing end-to-end encryption for messages

1:35:12

between Apple messages and Android users. By

1:35:14

rejecting solutions that would allow cross-platform encryption,

1:35:16

Apple continues to make the iPhone less

1:35:18

secure than they could be otherwise. This

1:35:21

is entirely Bieber's framing what was going on,

1:35:23

but it was ridiculous when Bieber said it,

1:35:25

and it's ridiculous when the DOJ, Bieber was

1:35:27

trying to use Apple servers in an authorized

1:35:29

manner to run a messaging service where it

1:35:31

didn't have to run the servers. That's

1:35:34

what they were doing. Nothing to do. But

1:35:37

this is as if Bieber wrote this. I

1:35:40

think they will not do well at that point in court

1:35:42

because it is ridiculous, but it's funny that they shoved it

1:35:45

in there. All

1:35:48

right, so this is about the NFC banking thing.

1:35:51

Apple acknowledges it is technically feasible to enable

1:35:53

an iPhone user to set another app, for

1:35:56

example, a bank's app, as the default payment app. And

1:35:58

Apple intends to allow this function to be Functionality in

1:36:00

Europe. I read this and I say hmm DOJ.

1:36:03

Why is Apple allow that functionality in Europe?

1:36:07

Did they just decide to do it in Europe

1:36:09

because they like Europe better or is something

1:36:11

else going on there? Maybe some other way

1:36:13

to change Apple's behavior other than suing them

1:36:17

Ancient antitrust laws like it's right there

1:36:19

in front of them They Apple intends

1:36:21

to allow this functionality in Europe like

1:36:23

the bell ringing somewhere Although I mean

1:36:25

keep in mind like it does kind

1:36:27