I wonder what lawyer at Apple thought that the EU would not investigate Apple's malicious compliance, or Apple has done this to see how far the EU will go.
This isn't US legislation where you can find loopholes, EU legislation prohibits malicious compliance and not following "the spirit" of the law, the latter Apple has publicly admitted to doing.
what a clickbait site. There are no sources that say Apple will be fined anywhere close to that. The journalist has just read the maximum punishment of the crime... You can also go to jail for speeding
There are tons of sources that help you understand what the punishment is for not following the DMA:
> The DMA would constrain gatekeepers’ behaviour while forcing them to proactively open up to more competition. Those in breach of the rules face penalties of up to 10% of their yearly turnover and repeat offenders face being broken-up.
"Could" is insanely sensationalist. Just beause HN got a boner against Apple's consumer-friendly ecosystem does not make it reasonable to think this will happen.
> could be fined up to 10% of its worldwide turnover
That "up to" makes me nervous that 10% won't happen, but I love the idea of smacking companies with real fines for not complying / maliciously complying with laws.
It wont happen immediately. Fines will likely happen in the same way that they have for the GDPR violations, which are effectively doubling for every major offence, and are now up to 1.2bn EUR in the case of Meta, for example.
The first offence has a max fine of 10%. Second offence has a max fine of 20%, as the article says:
"If that investigation confirms that Apple failed to comply with the antitrust law, then the iPhone maker could be fined up to 10% of its worldwide turnover – increasing to 20% for repeat infringements …"
If they did 10% of global turnover, I'm pretty sure the US government would get involved, so I don't think Europe will go there. They would basically be starting a trade war.
> but I love the idea of smacking companies with real fines for not complying / maliciously complying with laws.
A lot of people don't, or to say, when you have extra-territorial penalties (we are going to fine you on all the money you spend), things get messy really quickly.
Apple can also always just exit the European market. At some point it makes no sense to be in it, and Europeans will simply buy their iPhones on overseas trips.
It would never make it that far, so we are just speaking hypothetical, but basing fines on global turn over is specifically targeted at American companies (who make most of their money not in Europe), and would get attention from the USG.
Don't understand Apple here. This was a clear cut case of malicious compliance, what did they expect? That they just get away with it? Of course the EU would see the provocation and will take the opportunity.
Yes, they might gain a couple years till this is settled, but they can't use the time to crush a competing app store in between, as there is currently none. I am sure I am dumb, but IMO the smart move would have been to work with the law and a couple of years down the road point out that alternative app stores never caught on (which is very likely, IMO)
The EU has said they’re going to fast track the enforcement of these. Apple lawyers, simply, fucked up.
They lost so much good will with developers over this, have lost any goodwill with negotiations with EU, and are now going to have to speedrun compliance.
I’ve dealt with lawyers like this before in various company situations. They are sometimes really, really stupid. Not always, but it happened often enough to be terrifying.
I am unsure about hubris, but I can totally see it as a "That does not align with our long-term strategy" and it getting rejected.
Perhaps there was some "But we're apple! We are a luxury aspirational brand! We shouldn't have to lower ourselves to this" in the traditional reality-distortion-field of thinking they are somehow special or above the rules that everyone else has to deal with. I'll admit is kinda fund to imagine that, but hey :)
Apple has never been big enough to deal with competition authorities. They lack the institutional expertise and mindset for their present circumstances.
They will continue to fail until the penalties are unbearable.
This might sound like a dumb question - but why do lawmakers write such roundabout legislation in the first place?
They could have passed a law that says “In the EU, app stores including Apple’s App Store on iOS will not be allowed to charge a fee greater than x% on developers.” And the whole thing would be solved. We can argue about what X should be, but then we wouldn’t have to jump through all these hoops.
They did that for credit cards, but for app stores I think opening up for competition is probably better than capping the fees because here a big problem isn't just the fees but also the control and influence these big corporations has as digital gatekeepers.
Because that's not nearly their own objection against Apple and other platform companies targeted by the DMA.
For example, Meta is targeted by the same law on WhatsApp messaging interoperability; Apple on their exclusive use of the contactless interface for card payments etc.
It's a much more generic and wide-reaching regulatory tool than just an "anti-app-store law".
That’s kinda my point though, by having such generic and wide ranging laws, it opens up room for loopholes and confusion. They should just say specifically what the desired impact of the law is.
Laws being generic is usually a good thing. Those targeting only a specific company are often thrown out by higher/constitutional courts as violating fairness principles.
Because the problem is more complex. It is not only about the fees - obviously some large companies have that in their focus - but about general user freedom. Like being able to use a web browser of your choice. Or, in general, not have Apple reject some software from their App Store for reasons which are not tied to clear security violations.
It is possible to deliver free apps through the App Store without any download limits. But with competing App Stores it isn't.
I think you’re right, but my take is that the user freedom bit is a regulatory overreach. Couldn’t Apple literally turn off the App Store tomorrow, or replace everything with first party applications? There’s no law saying they have to support all these developers, though the DMA may require this indirectly. It feels like a slippery slope to “you need to be able to run Android on your iPhone hardware” or something like that.
It just seems really far fetched to me if you were to apply this logic to other industries- eg “movie theaters must let you play any movie, not just the movies they want!” Or “movie theaters must allow you to bring your own popcorn or allow competing concessions vendors!”
What I think is within regulatory oversight is the fees people charge within certain jurisdictions, because governments should regulate commerce. Similar to how they regulate bank fees, real estate transactions, VAT, etc. They could set a maximum, prevent charging fees for free software, or all sorts of other things that would help developers and consumers without forcing Apple to support weird 3rd party app distributors.
> It just seems really far fetched to me if you were to apply this logic to other industries- eg “movie theaters must let you play any movie, not just the movies they want!” Or “movie theaters must allow you to bring your own popcorn or allow competing concessions vendors!”
If a local movie theater doesn't play the movie you like, you can go to a competitor. If no such competitor exists, and movie theaters would be essential to daily life, such a method would make more sense.
The DMA targets "gatekeepers", ie not local movie theaters, but enormous companies that have done their best to entrench their market position by making competition difficult or impossible. I would keep that in mind when comparing to other industries.
You can of course buy an Android, and I am not an expert on the DMA or economics, but the playfield of a group of local movie theaters is wildly different from Apple's Apple Store (or browser, or Apple Music store, etc).
Because they’re trying to solve a class of problems and targeting individual companies with draconian requirements isn’t procedural and on the surface is punitive with no regulatory or legal reason.
The regulation creates the context to specify something like this. Writing ad hoc rules for named entities without a law or regulation behind it isn’t how our system of governance works. You first have to have a framework to judge against, either in law or regulation. You then assess the compliance of each in scope entity and issue findings.
Btw the term “malicious compliance” isn’t really a thing. The right term is “willful noncompliance.” For this they need to prove intent to be a defensible finding, which they probably could. However it would be easier to just find them in non-compliance.
I would also note this is a back and forth. What surprises me is Apple went public with their plans rather than developing them directly with the regulators. Going public with their plan creates all sorts of problems for Apple.
This is surprising because Apple is a pretty sophisticated regulatory player. For all their devices they go through many regulatory processes and regimes. They have tons of experience dealing with regulators across many regions and regulatory domains, including these sorts of policies. This is a shocking lack of cooperative behavior that won’t work for Apple. Apple is flush with cash, but governments have unlimited resources and the ability for forcibly enforce their will. It’s usually smart money to invest in appeasing your regulators in private.
Yeah I see what you mean, I just think these regulatory frameworks are themselves somewhat draconian, indirect, and lead to obnoxious and bad user experiences despite their good intentions, like cookie consent popups.
Obviously my opinion doesn’t matter, but wouldn’t it be easier if the EU simply said, “We have the power to regulate commerce in the EU, including software marketplaces. We have decided X.” That would be pretty similar to how many governments set maximum credit card interest rates (as someone mentioned below) as well as other transaction fees in industries that are vulnerable to cartel-like behavior like real estate.
In fact, I’m almost convinced that this regulatory framework was suggested by Apple themselves, because it doesn’t really accomplish anything. No one wanted to use third party app stores, they just want Apple to stop charging them so much. It’s fundamentally a payment processing issue, and they’ve spun it into a user freedom issue.
It’s always a cat and mouse thing but being overly obtuse runs the risk of irritating the regulator. The reality is there’s a clear intention and spirit behind the regulation. It’s also purposefully vague to capture more than this one case and allow for creative compliance that meets the spirit. Often regulators fail to grok the specific details of a business and the point isn’t to crush companies it’s to elicit a behavior.
But being evasive or a general asshat with a regulator leaves you open to the fact it was vague and the judge of compliance isn’t you, it’s the regulator. And if you’re too far in the wrong direction criminal consequences can kick in. Creating ill will makes all future interactions worse. So it’s really in your best interest to engage constructively with your regulators to achieve a best outcome possible.
There are exceptions - Uber has made willful non compliance a business model requiring that TLC regulation is pretty toothless. I don’t think Apple will find a similar situation here.
They will go through the EU appeals court process for 8 to 10 years, while making billions. To finally agree to some fine with minor inflation corrections. From a financial management aspect makes total sense.
Fwiw the term you want isn’t malicious compliance, which isn’t a real thing. It’s willful non-compliance. Willful non compliance is potentially a criminal offense and requires providing intent or conspiracy. It’s much more likely they’ll just be found non compliant.
Apples strategy here is baffling. They’re not unfamiliar with regulation and how to manage regulators. This is really not a good strategy they’re doing and it’ll make everything worse for them at every step. The fact they unveiled their plans publicly without a green light from the regulator means they’re doing some sort of weird game of chicken.
IMO they’re underestimating the motivation of the EU to try to break US tech megacorps grip to try to create a place that an EU tech megacorp might emerge. I don’t know that it’s a very sensible strategy as any EU megacorp will also be subject to onerous requirements, but will have to bootstrap in that regime. Also until the EU fixed its banking and investment structures, pay improves, and any number of other head winds abate, I wouldn’t expect attacking FB, Google, and Apple with regulatory burden will be meaningfully helpful to any tech company in the EU.
> a couple of years down the road point out that alternative app stores never caught on
This is the conclusion they hope to force now. Strangling the babies in the cribs rather than trying to rein in a bunch of unruly teenagers that have resources to fight.
The EC is not the final arbiter in this. It’s just an executive body.
Apple complied with what they think will withstand adjudication by the CJEU and leaves the rest for the EC to act on so they can appeal it with the CJEU.
Given the EC’s poor track record in terms of getting their fines and decisions overturned by the CJEU, I too would do it this way, no matter how loud the EC likes to bark and show their teeth.
Especially considering the DMA is poorly drafted and in Europe, unlike in the US, the courts aren’t ghostbusters that go seeking for “spirits” of the law.
Whether the EC thinks so or not, Apple is in compliance with the straightforward parts of the DMA as well as with the more vague parts on the basis of reasonable interpretation, to be adjudicated by the CJEU.
In law there’s very little that’s certain, as such it’s bad form to make predictions, but I’m pretty confident in saying that the CJEU isn’t going to open Pandora’s box by prohibiting Apple from charging a reasonable fee for their IP.
I don't understand - using apple products is some kind of blessing from the gods and without them Europe is now going to be in "technological isolation"? Get real for a second - apple devices are luxury and if Apple pulled out of EU tomorrow the only losing side in that equation would be apple.
No idea why we'd be in economic isolation because of that either. Is our trading of general goods with US reliant on Europeans buying iPhones?
Each little anti-business decision is a multiplier on the previous one.
For a long time, nothing happens.
Next thing you know, your economy is half the size it could have been. About 15 years ago, the US and EU economies were actually the same size. Since then, the US almost doubled, and the EU is literally stuck at the same size. Why should Europeans be so much worse off? Surely they deserve better - more money, more options?
Furthermore, this is clearly part of a larger pattern of targeting big US tech companies. This isn't endearing the EU to business and political leaders in the US.
>>Furthermore, this is clearly part of a larger pattern of targeting big US tech companies.
Because big US tech companies are playing fast and lose with the consumer rights and privacy of our data that we as Europeans have come to expect. If a German or French company was breaking the rules in that way I would also expect them to be treated the exact same way and fined into oblivion.
>>This isn't endearing the EU to business and political leaders in the US.
I will take protection of consumers over "endearing" ourselves to businesses and political leaders in the US. Your business practices do not trump our expectations as society - but you wouldn't expect any less from foreign companies doing business in US, so why is this surprising? US is constantly introducing tariffs regulations and fines for foreign companies doing business on its soil, because you want foreign business to play by your rules. But when someone does it to you it's suddenly going to collapse our economy?
This is completely fair - you have to play by the local rules to be in that economy. But my point is that if those rules become really onerous, then people might calculate that it's better to not play. The best thing is to be the one who invents a new industry, but from over here it seems the big focus over there is not innovation, but regulation.
I'm not saying the European economy would ever collapse, I'm saying it suffers from things like this. It's good now, but could have been wonderful.
The economy? Sure. The economy really isn't all that societies are about, but I'm sure even you'd agree with that statement - like for example, if someone said that installing permanent unremovable surveilance inside your house and sharing its data publicly would grow your economy by 20%, would you agree to that? Surely it would be wonderful.
There's a line that everyone draws - some countries draw it elsewhere than others, but there is a line.
> Surely compliance with the law is more profitable then stopping trading.
Well, that's the rational point-of-view, yes.
...but the most surprising thing to me to come out of this whole thing was how Epic Games was given the same choice w.r.t. Apple's App Store in-app-purchasing rules, but they decided to do the very irrational thing and sacrifice 100% of their income from their iOS players by being banned from the App Store instead of complying with Apple's "law".
I'm still trying to understand what went through Epic's leadership. They can argue it was over a moral principle, but their case (at the time) was so weak it made them look worse than Apple in my eyes.
It's like if Epic was Rosa Parks, but if she sat at the front of the bus in order to give a timeshare sales presentation to the other riders.
I don't think it's ever gonna happen. 30% of 380 is ~120B. If they get the full fine, they will still get ~(120 - 38)B which makes that price of doing business instead of an "headache".
Maybe they will pull out of Europe then, but laws are laws and businesses must comply. Whether those lose make sense is another issue.
> As an aside, it’s baffling to me why an aging continent with a sluggish economy would want to start a trade war with its only friend.
This isn't a trade war, there is no competition the EU is trying to bolster. The way I see it they are just being assertive about their market rules, which is refreshing considering other regions tend to get walked over.
You have to out-invent, out-sell, and out-implement your economic rivals. You can't out-regulate them, because if you create an economic island with nothing but strict regulations, there's no strong incentive for the rest of the world to connect with that island.
Now, if EU regulations created an amazing place to live where everybody's inventing and implementing the future, that would be great. (And the EU does have lots of common-sense regulations with a high return on investment). The best way to set the tone of the future is to build it yourself, not complain about what someone else built.
In the days of global trade wars that friend is no longer the friend it used to be, specially if voters decide Trump is a president worth having after everything that went down.
EU legislation generally sets a maximum, but then you also have to prove proportionality to determine the actual amount (damage done + fine). Any such amount will certainly get challenged in the courts, so the Commission will get its ducks in a row before actually settling on a number.
>>This is why I like Trump to win so that he can tell these EU blood suckers to back off American Companies and stop using them as a piggy bank because their sad, pathetic regulations are literally kneecapping an entire industry.
If Americans don't want to play by European rules, they are absolutely free to stop doing business here. No one is forcing them.
Also how do you imagine it working? Trump becomes president and just tells EU to back off? And will be met with anything other than laughter?
>>EU GDP / innovation has been a disaster ever since these monstrous regulations were put in place.
Well I guess for an American the idea of the government protecting its citizens with regulations must be completely wild - so I kinda understand why you wouldn't see that point of view.
>> but this is the time for Americans to show strong leadership and put these bureaucrats in place.
Like they do at home, where corporations do basically whatever they want? Maybe start in your own home before you start telling other countries to "back off"?
>>Yes, if we want to protect their sorry assess from Putin or something, they better come to the table with compromises.
Is this what you think this is about?
>>Like I said, this is what great leadership is working to the benefit of both countries.
What do you mean? What leadership exactly are you talking about? Right now you have a senile grandpa in charge, and you're advocating replacing it with another senile grandpa - both of them belong in a nursing home. Neither one should be deciding anything about economy, not even because of their age but because that's not what presidents do.
>>while sad / pathetic EU is still mired in one.
In one what? Recession? No country in the EU is in one.
>>10 years from now where EU is behind everything where even Saudi Arabia / UAE / CHina have leapfrogged EU in terms of innovations and GDP, it will start becoming more and more irrelevant.
Do you sell crystal balls, and if yes can I buy one?
My apologies, indeed Germany is still in recession(France isn't, so I'm not sure why you linked that). I was looking at the overal figure that shows EU as a whole isn't in a recession, as you said "EU is still mired in one". So I guess you also don't get your facts straight? Or is it just a slip of the tongue?
sorry not sorry, apple had this coming to them, and we the American consumer will be better off for it when they get their act together. Apple kneecapped themselves.
And FYI it's unpopular because it's wrong, not because of political differences. Please don't conflate the two.
The patent and rights monopolies of corporations are maintained and defended by the state. Corporations cannot profit from IP rights guaranteed and defended by the state then turn round and insult the state.
I did. Perplexity updates daily. Better than "googling" these days.
At least I attributed it. Don't like the stats, find better ones, or contradicting ones.
I am not against the statistics, it's well known that the Android ecosystem has more malware than iOS. I was more faschinated by you using LLM as source. I hope I didn't sound condescending, I was asking out of curiosity.
The way you attributed it wasn't properly done though, it's like me saying "According to Google, Android has X times more malware...".
Is there a "proper way" to attribute information on the internet? And, in a comment forum?
I clearly stated the source as perplextity.ai.
In fact, perplexity includes actual sources (via links). I couuld have posted the 8 sources that perplexity.ai cited.. I did not want to take the time.
Perplexity does have a sharelink, so, if you are really curious, here is the search and results
If you don't want a third party app store, don't install one. TaDa ... Nothing changes for you. Now let the rest of the people, that want to use THEIR phone as THEY want, let them.
Well, thank you for "oversimplifying it"
But, the existence of a 3rd party app store, with "zero cost" to developers apparently, would almost certainly force someone in need of an app for some purpose to use this app store.
If I have a tool, lets say I buy a 'doorbell' camera. Right now, the "app" must be curated and qualified and verified clear of defects, malware, etc by App store policy and review. (not that they are 100%, but it's a pretty decent process).
When a 'free app store' shows up, then this same doorbell camera company will just pop their app, which will become a much shittier version of what would have been available, into some shitty app store, and, not bother to make a better version.
What will happen, in practice, is that there will be some percentage of apps that become shittier and only available from the shitty 3rd party store, and not the curated (and not free) app store.
So, no, it won't be a simple matter of just "don't use that store", there will be more factors at play.
Estimated annual sales of iPhones in EU are about 12.4M phones in Q4 2023. If you just do quick math, that is 49.6M phones/year. If you pick an ASP of $800 (??) then that would be about $39.7B annual Gross sales.
If EU actually tried to get that money, Apple would have to just halt all sales of iPhones in EU.
Now, maybe that's what the EU really wants. Are there some bitter former Nokia execs on the EU panel?????
I'm sorry that you have such an emotional reaction about a company being threatened with a fine (not even penalised yet) for harmful behaviour which they could immediately choose to stop if they'd want to.
*
Two scenarios:
Company A violates consumer rights. Government does nothing, consumers continue to get ripped off.
Company B violates consumer rights. Government threatens fines. Company either fixes the problem (consumer hsrm reduced) or eats the fine (and the money can be used to pay for useful stuff). Either way, they can no longer gain by tipping off consumers and have every reason to stop if the fine may be repeated for a repeat offender.
*
Calculating on global profits is standard practice and is done the same theme the US calculates fines (depending on what the fine is about - you might have different reference points for different harm). This is the only solution as otherwise companies will play the usual whack-a-mole where they create an "affiliate Europe" that is legally separate but pays 100% of its net profits as a licensing fee for the brand name to the parent company, thus making 0€ (more difficult to play this game with gross sales, but there are still plenty of ways to fudge those numbers).
If Apple halts their iPhone sales in the EU, they endanger their platform globally. Because suddenly a pretty large and important market would go 100% to Android. Also, Macs would become extinct pretty quickly in the EU.
The fine initially would be up to 10% of the revenue. I don't see how that is outrageous if the violation of the law is there. The actual fine could be lower, but on the other side, the fine needs to be high enough that it can force the fined company to stop breaking the law.
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[ 5.7 ms ] story [ 177 ms ] thread$38B in fines (or up to $72B) is not going to be well received by the markets.
This isn't US legislation where you can find loopholes, EU legislation prohibits malicious compliance and not following "the spirit" of the law, the latter Apple has publicly admitted to doing.
Mind sharing a source? I’d like to see how far the admission goes.
https://www.businessinsurance.com/article/20240119/STORY/912...
> The DMA would constrain gatekeepers’ behaviour while forcing them to proactively open up to more competition. Those in breach of the rules face penalties of up to 10% of their yearly turnover and repeat offenders face being broken-up.
https://www.bruegel.org/blog-post/regulating-big-tech-digita...
More info: https://en.wikipedia.org/wiki/Digital_Markets_Act
That "up to" makes me nervous that 10% won't happen, but I love the idea of smacking companies with real fines for not complying / maliciously complying with laws.
"If that investigation confirms that Apple failed to comply with the antitrust law, then the iPhone maker could be fined up to 10% of its worldwide turnover – increasing to 20% for repeat infringements …"
> but I love the idea of smacking companies with real fines for not complying / maliciously complying with laws.
A lot of people don't, or to say, when you have extra-territorial penalties (we are going to fine you on all the money you spend), things get messy really quickly.
Apple can also always just exit the European market. At some point it makes no sense to be in it, and Europeans will simply buy their iPhones on overseas trips.
They would lose trillion from market cap if they exited.
Yes, they might gain a couple years till this is settled, but they can't use the time to crush a competing app store in between, as there is currently none. I am sure I am dumb, but IMO the smart move would have been to work with the law and a couple of years down the road point out that alternative app stores never caught on (which is very likely, IMO)
The Core Technology Fee is such a clear violation violation of the DMA rules.
Exec: So, how can we enforce a fee while complying with DMA?
Lawyer: We can't, DMA requires it to be open.
Exec: Are you sure? If you can't find a way around this you are fired!
Lawyer: Erm, of course there is a way!!!!
They lost so much good will with developers over this, have lost any goodwill with negotiations with EU, and are now going to have to speedrun compliance.
I’ve dealt with lawyers like this before in various company situations. They are sometimes really, really stupid. Not always, but it happened often enough to be terrifying.
Apple hoping for a far-right Republican presidency that would create a trade war with the EU?
That's the concerning thing...
This was Cook’s call, and hubris is guiding him.
Perhaps there was some "But we're apple! We are a luxury aspirational brand! We shouldn't have to lower ourselves to this" in the traditional reality-distortion-field of thinking they are somehow special or above the rules that everyone else has to deal with. I'll admit is kinda fund to imagine that, but hey :)
It's pretty hubristic to see that that law does not align with their long-term strategy, and then choose noncompliance with the law.
It is obvious Tim Cook is doing what ever he can to protect their services revenue. And lack the intuition Steve jobs has.
They will continue to fail until the penalties are unbearable.
They could have passed a law that says “In the EU, app stores including Apple’s App Store on iOS will not be allowed to charge a fee greater than x% on developers.” And the whole thing would be solved. We can argue about what X should be, but then we wouldn’t have to jump through all these hoops.
For example, Meta is targeted by the same law on WhatsApp messaging interoperability; Apple on their exclusive use of the contactless interface for card payments etc.
It's a much more generic and wide-reaching regulatory tool than just an "anti-app-store law".
It is possible to deliver free apps through the App Store without any download limits. But with competing App Stores it isn't.
It just seems really far fetched to me if you were to apply this logic to other industries- eg “movie theaters must let you play any movie, not just the movies they want!” Or “movie theaters must allow you to bring your own popcorn or allow competing concessions vendors!”
What I think is within regulatory oversight is the fees people charge within certain jurisdictions, because governments should regulate commerce. Similar to how they regulate bank fees, real estate transactions, VAT, etc. They could set a maximum, prevent charging fees for free software, or all sorts of other things that would help developers and consumers without forcing Apple to support weird 3rd party app distributors.
If a local movie theater doesn't play the movie you like, you can go to a competitor. If no such competitor exists, and movie theaters would be essential to daily life, such a method would make more sense. The DMA targets "gatekeepers", ie not local movie theaters, but enormous companies that have done their best to entrench their market position by making competition difficult or impossible. I would keep that in mind when comparing to other industries.
You can of course buy an Android, and I am not an expert on the DMA or economics, but the playfield of a group of local movie theaters is wildly different from Apple's Apple Store (or browser, or Apple Music store, etc).
The regulation creates the context to specify something like this. Writing ad hoc rules for named entities without a law or regulation behind it isn’t how our system of governance works. You first have to have a framework to judge against, either in law or regulation. You then assess the compliance of each in scope entity and issue findings.
Btw the term “malicious compliance” isn’t really a thing. The right term is “willful noncompliance.” For this they need to prove intent to be a defensible finding, which they probably could. However it would be easier to just find them in non-compliance.
I would also note this is a back and forth. What surprises me is Apple went public with their plans rather than developing them directly with the regulators. Going public with their plan creates all sorts of problems for Apple.
This is surprising because Apple is a pretty sophisticated regulatory player. For all their devices they go through many regulatory processes and regimes. They have tons of experience dealing with regulators across many regions and regulatory domains, including these sorts of policies. This is a shocking lack of cooperative behavior that won’t work for Apple. Apple is flush with cash, but governments have unlimited resources and the ability for forcibly enforce their will. It’s usually smart money to invest in appeasing your regulators in private.
Obviously my opinion doesn’t matter, but wouldn’t it be easier if the EU simply said, “We have the power to regulate commerce in the EU, including software marketplaces. We have decided X.” That would be pretty similar to how many governments set maximum credit card interest rates (as someone mentioned below) as well as other transaction fees in industries that are vulnerable to cartel-like behavior like real estate.
But being evasive or a general asshat with a regulator leaves you open to the fact it was vague and the judge of compliance isn’t you, it’s the regulator. And if you’re too far in the wrong direction criminal consequences can kick in. Creating ill will makes all future interactions worse. So it’s really in your best interest to engage constructively with your regulators to achieve a best outcome possible.
There are exceptions - Uber has made willful non compliance a business model requiring that TLC regulation is pretty toothless. I don’t think Apple will find a similar situation here.
Thats 15 years https://www.bloomberg.com/news/articles/2024-01-18/intel-win...
Apples strategy here is baffling. They’re not unfamiliar with regulation and how to manage regulators. This is really not a good strategy they’re doing and it’ll make everything worse for them at every step. The fact they unveiled their plans publicly without a green light from the regulator means they’re doing some sort of weird game of chicken.
IMO they’re underestimating the motivation of the EU to try to break US tech megacorps grip to try to create a place that an EU tech megacorp might emerge. I don’t know that it’s a very sensible strategy as any EU megacorp will also be subject to onerous requirements, but will have to bootstrap in that regime. Also until the EU fixed its banking and investment structures, pay improves, and any number of other head winds abate, I wouldn’t expect attacking FB, Google, and Apple with regulatory burden will be meaningfully helpful to any tech company in the EU.
Me neither but I'm probably going to leave Apple ecosystem with next devices. I guess 'nationalism' is a thing even for me.
This is the conclusion they hope to force now. Strangling the babies in the cribs rather than trying to rein in a bunch of unruly teenagers that have resources to fight.
The EC is not the final arbiter in this. It’s just an executive body.
Apple complied with what they think will withstand adjudication by the CJEU and leaves the rest for the EC to act on so they can appeal it with the CJEU.
Given the EC’s poor track record in terms of getting their fines and decisions overturned by the CJEU, I too would do it this way, no matter how loud the EC likes to bark and show their teeth.
Especially considering the DMA is poorly drafted and in Europe, unlike in the US, the courts aren’t ghostbusters that go seeking for “spirits” of the law.
Whether the EC thinks so or not, Apple is in compliance with the straightforward parts of the DMA as well as with the more vague parts on the basis of reasonable interpretation, to be adjudicated by the CJEU.
In law there’s very little that’s certain, as such it’s bad form to make predictions, but I’m pretty confident in saying that the CJEU isn’t going to open Pandora’s box by prohibiting Apple from charging a reasonable fee for their IP.
Looks like they make about 30% of that in Europe.
Sounds like about 80% of their headaches come from Europe.
If they get fined 10% of 380B, and the EU becomes ever more fine-happy, it will at one point make sense to simply shut down in Europe.
As an aside, it’s baffling to me why an aging continent with a sluggish economy would want to start a trade war with its only friend.
If the alternative is breaking EU rules - great. Let's see that happen.
>>As an aside, it’s baffling to me why an aging continent with a sluggish economy would want to start a trade war with its only friend.
It's hard to see why a country(well in this case a group of countries) would want to do good for their own citizens?
I guess in some places of the world that is indeed a very novel and unexpected thing.
No idea why we'd be in economic isolation because of that either. Is our trading of general goods with US reliant on Europeans buying iPhones?
For a long time, nothing happens.
Next thing you know, your economy is half the size it could have been. About 15 years ago, the US and EU economies were actually the same size. Since then, the US almost doubled, and the EU is literally stuck at the same size. Why should Europeans be so much worse off? Surely they deserve better - more money, more options?
Furthermore, this is clearly part of a larger pattern of targeting big US tech companies. This isn't endearing the EU to business and political leaders in the US.
Because big US tech companies are playing fast and lose with the consumer rights and privacy of our data that we as Europeans have come to expect. If a German or French company was breaking the rules in that way I would also expect them to be treated the exact same way and fined into oblivion.
>>This isn't endearing the EU to business and political leaders in the US.
I will take protection of consumers over "endearing" ourselves to businesses and political leaders in the US. Your business practices do not trump our expectations as society - but you wouldn't expect any less from foreign companies doing business in US, so why is this surprising? US is constantly introducing tariffs regulations and fines for foreign companies doing business on its soil, because you want foreign business to play by your rules. But when someone does it to you it's suddenly going to collapse our economy?
>>Surely they deserve better
They do, that's the entire point.
I'm not saying the European economy would ever collapse, I'm saying it suffers from things like this. It's good now, but could have been wonderful.
The economy? Sure. The economy really isn't all that societies are about, but I'm sure even you'd agree with that statement - like for example, if someone said that installing permanent unremovable surveilance inside your house and sharing its data publicly would grow your economy by 20%, would you agree to that? Surely it would be wonderful.
There's a line that everyone draws - some countries draw it elsewhere than others, but there is a line.
Apple doesn't seem to have any issue with that.
Surely compliance with the law is more profitable then stopping trading.
Well, that's the rational point-of-view, yes.
...but the most surprising thing to me to come out of this whole thing was how Epic Games was given the same choice w.r.t. Apple's App Store in-app-purchasing rules, but they decided to do the very irrational thing and sacrifice 100% of their income from their iOS players by being banned from the App Store instead of complying with Apple's "law".
I'm still trying to understand what went through Epic's leadership. They can argue it was over a moral principle, but their case (at the time) was so weak it made them look worse than Apple in my eyes.
It's like if Epic was Rosa Parks, but if she sat at the front of the bus in order to give a timeshare sales presentation to the other riders.
> As an aside, it’s baffling to me why an aging continent with a sluggish economy would want to start a trade war with its only friend.
This isn't a trade war, there is no competition the EU is trying to bolster. The way I see it they are just being assertive about their market rules, which is refreshing considering other regions tend to get walked over.
Now, if EU regulations created an amazing place to live where everybody's inventing and implementing the future, that would be great. (And the EU does have lots of common-sense regulations with a high return on investment). The best way to set the tone of the future is to build it yourself, not complain about what someone else built.
No you don't have to. Why is globalism a necessity?
We work to live, not live to work. We are pushing each other for economic growth so hard our population is starting to decline for "the hustle".
> The best way to set the tone of the future is to build it yourself, not complain about what someone else built.
Straw man? I'm not against innovation or the success of others. Why do you like being abused by large international organizations? :)
I guess 10% would be reserved for absolute refusal of compliance and malicious compliance might attract a smaller fine?
If Americans don't want to play by European rules, they are absolutely free to stop doing business here. No one is forcing them.
Also how do you imagine it working? Trump becomes president and just tells EU to back off? And will be met with anything other than laughter?
>>EU GDP / innovation has been a disaster ever since these monstrous regulations were put in place.
Well I guess for an American the idea of the government protecting its citizens with regulations must be completely wild - so I kinda understand why you wouldn't see that point of view.
>> but this is the time for Americans to show strong leadership and put these bureaucrats in place.
Like they do at home, where corporations do basically whatever they want? Maybe start in your own home before you start telling other countries to "back off"?
Is this what you think this is about?
>>Like I said, this is what great leadership is working to the benefit of both countries.
What do you mean? What leadership exactly are you talking about? Right now you have a senile grandpa in charge, and you're advocating replacing it with another senile grandpa - both of them belong in a nursing home. Neither one should be deciding anything about economy, not even because of their age but because that's not what presidents do.
>>while sad / pathetic EU is still mired in one.
In one what? Recession? No country in the EU is in one.
>>10 years from now where EU is behind everything where even Saudi Arabia / UAE / CHina have leapfrogged EU in terms of innovations and GDP, it will start becoming more and more irrelevant.
Do you sell crystal balls, and if yes can I buy one?
https://think.ing.com/snaps/german-economy-still-stuck-in-re...
https://think.ing.com/snaps/france-stagnation-continues/
https://www.theguardian.com/business/2024/jan/30/eurozone-re...
Anyway, are you going to address any other of my points, or has this ended the discussion for you already?
>>The problem with arguing with non-moderates
Clearly you've chosen a label for me in your head, so I guess we're done?
Those aren't good examples of free markets/low government intervention.
The US is doing the same thing?
And FYI it's unpopular because it's wrong, not because of political differences. Please don't conflate the two.
The state giveth and the state taketh.
The way you attributed it wasn't properly done though, it's like me saying "According to Google, Android has X times more malware...".
In fact, perplexity includes actual sources (via links). I couuld have posted the 8 sources that perplexity.ai cited.. I did not want to take the time.
Perplexity does have a sharelink, so, if you are really curious, here is the search and results
https://www.perplexity.ai/search/What-percentage-of-VTOCreO8...
I might give perplexity a try, looks really useful!
If I have a tool, lets say I buy a 'doorbell' camera. Right now, the "app" must be curated and qualified and verified clear of defects, malware, etc by App store policy and review. (not that they are 100%, but it's a pretty decent process).
When a 'free app store' shows up, then this same doorbell camera company will just pop their app, which will become a much shittier version of what would have been available, into some shitty app store, and, not bother to make a better version.
What will happen, in practice, is that there will be some percentage of apps that become shittier and only available from the shitty 3rd party store, and not the curated (and not free) app store.
So, no, it won't be a simple matter of just "don't use that store", there will be more factors at play.
Then don't install one? I literally don't get this argument.
>>So, EU, back off on your pushing for a 3rd party app store.
....why? Because of something you don't want?
If EU actually tried to get that money, Apple would have to just halt all sales of iPhones in EU.
Now, maybe that's what the EU really wants. Are there some bitter former Nokia execs on the EU panel?????
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Two scenarios: Company A violates consumer rights. Government does nothing, consumers continue to get ripped off.
Company B violates consumer rights. Government threatens fines. Company either fixes the problem (consumer hsrm reduced) or eats the fine (and the money can be used to pay for useful stuff). Either way, they can no longer gain by tipping off consumers and have every reason to stop if the fine may be repeated for a repeat offender.
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Calculating on global profits is standard practice and is done the same theme the US calculates fines (depending on what the fine is about - you might have different reference points for different harm). This is the only solution as otherwise companies will play the usual whack-a-mole where they create an "affiliate Europe" that is legally separate but pays 100% of its net profits as a licensing fee for the brand name to the parent company, thus making 0€ (more difficult to play this game with gross sales, but there are still plenty of ways to fudge those numbers).