The price of success
There are several reports, the first of which came from the New York Post, suggesting US antitrust regulators are considering launching an investigation into Apple's decision to change the terms of its iPhone OS SDK such that apps developed on any platform it hadn't approved - such as Adobe Flash and Air - will not be allowed on the iPhone or iPad.
The reason this has become an antitrust matter lies in the success of the Apple devices themselves. While Apple has nothing like the market share Microsoft and Intel have in PCs - which precipitated the antitrust action against each of them - as the maker of both the hardware and the OS, it has a lot more control over access to the end-user.
As if to wave a red flag in the face of regulators, Apple issued a press release crowing that it had already sold a million iPads yesterday. Right now that pretty much makes it a monopolist in the tablet/slate market, if you look at that form-factor in isolation.
The good news for Apple, if indeed this investigation does commence, is that all it needs to do is undo the new restrictions in its iPhone OS SDK to make this particular problem go away. But this looks like setting a precedent for Apple, which thus far has escaped the attentions of regulators despite now being far bigger than Google or Intel and nearly as big as Microsoft, by market cap.
One example is the acquisition of mobile advertising company Quattro, which went through unhindered while Google's proposed acquisition of AdMob looks set to be opposed. Already, however, the WSJ reports that Apple's new iAd platform may be part of the investigation into Apple, with its closed system once-more causing concern.
It's thought that Steve Jobs open letter, in which he attempted to stress how ‘open' Apple is, was an attempt to pre-empt regulatory scrutiny. But in our view it's quite right that Apple's rapidly increasing size and influence - especially in the massive mobile Internet market - should mean that its business practices draw more scrutiny than before. That is the price of success in business.
