EU Lists First 7 Potential "Gatekeepers" Under The Digital Markets Act (DMA)

[HenrySalayne]

6 hours ago, wanderingfool2 said:

I would say, it depends.  When talking about walled garden approach, like iPhone, if let's say they now have to offer an app store other than themselves...and lets say Google opens their app store on iPhones.  There would be, I believe, a decent amount of people who would switch from to that.

Now Apple makes the majority of their money from the store, instead of selling the iPhone itself (relatively speaking).  If lets say they lose even 10% of their app revenue now, would they start increasing their price of their phones to compensate (as per $ it's still the most performing phone usually)...where one of the reasons for that is they don't have to worry as much about making a profit on their phones.

My god, what an argument...

Apple is printing money left, right and centre with every part of the chain, not just the app store. They have an overall gross margin of more than 40%! Apple could just discount anything by 20% and they would still print more money than they could spend.

Quote

Consumers will have more services to choose from, more opportunities to switch providers, and will benefit from better prices and higher quality services.

Innovative companies will no longer be prevented from reaching new customers.

And guess what the DMA is all about: breaking barriers that are only designed to redirect the highest amount of money into one's pocket. Any amount of money Apple is losing, is just a measurement of their anti-competetive and anti-consumer behaviour in the past.

 

I'm flabbergasted that this is even a point. What amount of corporate brainwashing is needed to make somebody worried about Apple not making enough money? In a world where Apple is making incomprehensible amounts of money far beyond any comparable corporation.

[RejZoR]

9 hours ago, LAwLz said:

You're essentially looking at two cars, one red car, and a blue car, noting that the red car is faster, and then saying "People who buy blue cars don't understand that red cars are faster. Red cars are just better than blue cars".

 

There is nothing about it being a walled garden that makes something work better or worse. What you are describing is a good implementation, which is not inherent to it being a walled garden or not. A walled garden might have a poor software architecture that causes it to not work that well, just like an open standard can work really well. It's all down to implementation, it doesn't have anything to do with open vs walled gardens.

 

I don't see anything in this legislation that would force these companies to make their services worse. It's more about saying "hey, you're not allowed to put up roadblocks so that competing products become worse to artificially make your service seem better by bringing others down".

It's like being the fastest sprinter in school because you broke everyone else's legs with a hammer. You don't really get to say "but I won't be the fastest if you take away my hammer, so I am a victim here". If you really are that good then you should have no problem competing fairly, without kneecapping your opponents.

Your analogy makes literally zero sense. History has shown time and time again that open stuff just never works right even if it's the best shit ever on paper. Meanwhile walled garden is always controlled and made sure it does shit in it well.

[porina]

6 hours ago, Brooksie359 said:

Shareholders have a right to sue if dumb decisions like this that could lead to them losing alot of money in the form of share prices which this absolutely would tank share prices. Also this can be a class action lawsuit or even one or major shareholders. Regardless if the majority of shareholders agree the other shareholders have the right to see for financial damages from such a stupid decision.

A legal right to sue doesn't mean they necessarily have a leg to stand on. I've not looked extensively in the area, but the cases making the news on our tech radar usually boil down to claims of bad information. There is a legal requirement for companies to report truthfully and accurately when making statements that can affect perceived company value in the eyes of investors. If a company were to take such a direction then they would be talking about it in advance of implementation, saying why they think it is better for the company longer term if they go through with it. Shareholders who don't like it have two options: dispose of their holdings, or seek to change the companies mind on the decision, which can include going to the courts. Unless they're a very big shareholder or a significant proportion think the same way, the latter is unlikely to get any traction beyond nuisance suits.

 

55 minutes ago, HenrySalayne said:

They have an overall gross margin of more than 40%! Apple could just discount anything by 20% and they would still print more money than they could spend.

For tech stocks, 40% isn't amazing. If it dropped by 20 points, it would be really awful. A good place to be for GM is 40-50% range, and companies can attain higher. Roughly speaking, GM is material profit but doesn't account for many things like running costs or development, which have to be paid out of it.

[HenrySalayne]

8 minutes ago, porina said:

For tech stocks, 40% isn't amazing. If it dropped by 20 points, it would be really awful. A good place to be for GM is 40-50% range, and companies can attain higher. Roughly speaking, GM is material profit but doesn't account for many things like running costs or development, which have to be paid out of it.

In comparison to Samsung and Huawei (or any other similar corporation) and at the sheer volume they operate, Apple is immensely profitable and they still would be if dropped by 20 points.

[porina]

13 minutes ago, HenrySalayne said:

In comparison to Samsung and Huawei (or any other similar corporation) and at the sheer volume they operate, Apple is immensely profitable and they still would be if dropped by 20 points.

They could certainly survive periods of it, but it wont be a place they'd want to be longer term because it means something has gone wrong.

 

Recently they're 40%+, but going back a decade they have been around the high 30's. The chart I managed to find goes back to 2005, which is before the release of iPhone, and they were driven in part by the iPod. Even then it was high 20's.

 

Some other examples in tech space for indication:

NVIDIA are sitting nicely not dropping below 50% in the last decade, recently above 60% more often than not.

AMD is more variable, even having some quarters in single digits, but averaging over 30% in the last decade and over 40% more recently.

Intel is doing the opposite to AMD. Historically above 50%, often above 60%. Recently it is trending downwards with last reported quarter at 35%.

 

Since Samsung was mentioned and is a bit of a different part of the tech area, they've been more variable in the 30-50% ball park longer term, but more recently on the low end of that. I suspect their much wider product mix can both help and hinder. I can't find similar info for Huawei, only net margin which is not comparable.

[LAwLz]

2 hours ago, RejZoR said:

Your analogy makes literally zero sense. History has shown time and time again that open stuff just never works right even if it's the best shit ever on paper. Meanwhile walled garden is always controlled and made sure it does shit in it well.

No it hasn't... Again, it has nothing to do with open vs walled garden. 

You are jumping to conclusions and thinking that Correlation implies causation. 

[RejZoR]

32 minutes ago, LAwLz said:

No it hasn't... Again, it has nothing to do with open vs walled garden. 

You are jumping to conclusions and thinking that Correlation implies causation. 

Um, ok, whatever. It's why everything outside Apple works so great, right? The wonderful open Android ecosystem that everyone has their own flawed take on that never actually works right or even actually well. And don't even think of whining I'm an Apple fanboy coz I have Galaxy S23 Ultra and Galaxy Watch 4 and they don't work even remotely as well as Apple's ecosystem did. And I'm not even from America where it actually works well.

[Brooksie359]

2 hours ago, porina said:

A legal right to sue doesn't mean they necessarily have a leg to stand on. I've not looked extensively in the area, but the cases making the news on our tech radar usually boil down to claims of bad information. There is a legal requirement for companies to report truthfully and accurately when making statements that can affect perceived company value in the eyes of investors. If a company were to take such a direction then they would be talking about it in advance of implementation, saying why they think it is better for the company longer term if they go through with it. Shareholders who don't like it have two options: dispose of their holdings, or seek to change the companies mind on the decision, which can include going to the courts. Unless they're a very big shareholder or a significant proportion think the same way, the latter is unlikely to get any traction beyond nuisance suits.

 

For tech stocks, 40% isn't amazing. If it dropped by 20 points, it would be really awful. A good place to be for GM is 40-50% range, and companies can attain higher. Roughly speaking, GM is material profit but doesn't account for many things like running costs or development, which have to be paid out of it.

You don't generally see lawsuits like you would in this case because there haven't really been situations where their is no reason to pull out of such a huge market and only leads to shareholders lose with no real upside. But yes they have the right to sue if a company head is breaking their fiduciary duty. I doubt it would ever come to that though because there is very little chance that any of these companies would pull out of the EU for something this little. 

[hishnash]

6 hours ago, wanderingfool2 said:

so also the compiler then I do think based on the rules that it might require them to offer the necessary tools to compile onto their system free of charge.

Clang is open source apple cant stop you compiling your c/c++ code. As is the Darwin kernel and the api it exposes.  

APIs to access HW (kernel to user-space interface apis) is very different from user-space features like UI frameworks, high level networking stacks, data storage layers etc. 

The law does not require apple provide devs a text rendering api for example as that is a user space api and nothing to do with HW, devs can use apples and pay apple for it or they can build thier own, same for the UI frameworks, etc.  

The can use strand low level Free-BSD networking apis without paying apple but if they want to use URLSession or Framework.Network etc (built ontop of the the kernel apis) then they are using apples SDK. 

[LAwLz]

5 hours ago, RejZoR said:

Um, ok, whatever. It's why everything outside Apple works so great, right? The wonderful open Android ecosystem that everyone has their own flawed take on that never actually works right or even actually well. And don't even think of whining I'm an Apple fanboy coz I have Galaxy S23 Ultra and Galaxy Watch 4 and they don't work even remotely as well as Apple's ecosystem did. And I'm not even from America where it actually works well.

"why are all the blue cars I've seen slower than red cars if the color doesn't matter? I have a blue car by the way so I know they are slow". 

[wanderingfool2]

9 hours ago, HenrySalayne said:

My god, what an argument...

Apple is printing money left, right and centre with every part of the chain, not just the app store. They have an overall gross margin of more than 40%! Apple could just discount anything by 20% and they would still print more money than they could spend.

Spoken as someone who has no clue how business will work.

 

Apple makes the highest margins on their software/services (at roughly 66%).  For hardware it's only 31%.

 

Do you seriously not understand that Apple is publicly traded company, if the law went through and lets say cut it down to 33% and 15% profits; do you honestly not understand that Apple to appease investors would have to come up with a way to charge the customers more money to make up for the loss in revenue.

 

It's like your discount by 20% comment, they do that and the CEO/CFO will quickly be voted out.

 

A more practical example, Netflix and their monopoly.  Had you not had Disney+, HBO max, etc enter the market we would have gotten more shows with paying less...but now there are multiple streaming services, things like Netflix has to increase rates and eventually so will the other platforms because you are effectively dividing the wealth but none of the companies want to take the losses so they devise methods to try gaining more money (in the case of Netflix higher charges and crackdown on password sharing).

 

10 hours ago, HenrySalayne said:

I'm flabbergasted that this is even a point. What amount of corporate brainwashing is needed to make somebody worried about Apple not making enough money? In a world where Apple is making incomprehensible amounts of money far beyond any comparable corporation.

Please look in the mirror.  It's not my fault you can't understand that a public company will always try maintaining or increasing profit.

 

Apple at least for iPhones, seems to get the most bang for your buck at the moment in terms of processing.  It doesn't matter if they make healthy margins on it, the simple fact is that if they weren't making even better margins on the software they would have to make it up by increasing the price somewhere else.

 

Software/Services makes up for 1/3 of their total net income.

 

[HenrySalayne]

1 hour ago, wanderingfool2 said:

A more practical example, Netflix and their monopoly.  Had you not had Disney+, HBO max, etc enter the market we would have gotten more shows with paying less...but now there are multiple streaming services, things like Netflix has to increase rates and eventually so will the other platforms because you are effectively dividing the wealth but none of the companies want to take the losses so they devise methods to try gaining more money (in the case of Netflix higher charges and crackdown on password sharing).

[Vilacom]

2 hours ago, HenrySalayne said:

His example is...lets call it interesting, but the netflix point is where this is heading.  How many app stores/update platforms do you want on your phone?  I hope its the same as the number of streaming services that you might need to watch all the content you want to as well.  Want to replay final fantasy on your phone/tablet?  The remakes are great, time to install the squaresoft store.  Do you use mobile discord?  Need that one as well.  Mobile streaming?  Get the netflix app store, the hulu one, disney of course, etc etc.  Every major corporation will want their own distribution platform to record data, maintain their own payment processor, push updates, etc etc.  

The reality is for what people actually want you'll need a "government run" app store which has its own huge host of potential problems, but at least it could be a service who's goal is not specifically to profit and can only focus on distribution and screening. 

[HenrySalayne]

19 minutes ago, Vilacom said:

His example is...lets call it interesting, but the netflix point is where this is heading.  How many app stores/update platforms do you want on your phone?  I hope its the same as the number of streaming services that you might need to watch all the content you want to as well.  Want to replay final fantasy on your phone/tablet?  The remakes are great, time to install the squaresoft store.  Do you use mobile discord?  Need that one as well.  Mobile streaming?  Get the netflix app store, the hulu one, disney of course, etc etc.  Every major corporation will want their own distribution platform to record data, maintain their own payment processor, push updates, etc etc. 

Somehow we haven't seen this on other already open platforms?

[Vilacom]

43 minutes ago, HenrySalayne said:

Somehow we haven't seen this on other already open platforms?

The other open platforms kind of don't matter, if you cant get the big ones then its not worthwhile.  

Also we have seen this, its literally streaming platforms and PC gaming, companies making their own launchers, everyone wants to keep their content to their own streaming service to get subscriptions.  Console game platforms, its all already there

[HenrySalayne]

7 hours ago, Vilacom said:

Also we have seen this, its literally streaming platforms and PC gaming, companies making their own launchers, everyone wants to keep their content to their own streaming service to get subscriptions.  Console game platforms, its all already there

Since when do streaming platforms have their own app store?

8 hours ago, Vilacom said:

Mobile streaming?  Get the netflix app store, the hulu one, disney of course, etc etc.  Every major corporation will want their own distribution platform to record data, maintain their own payment processor, push updates, etc etc.  

 

And games had a tendency to force their own launcher (with a separate account) in addition to a platform like Steam. This fragmentation is certainly annoying for customers, but it doesn't make it more expensive. Additionally we already see this trend ending and some major publishers are not forcing their launcher any more.

Besides the loss of comfort the only real negative of all these launchers is the loss of support and/or access once the service is gone. But that's a completely separate topic to DMA and something the EU will hopefully address in the future. A perpetual license should be a perpetual license and not just be perpetual until the developer decides it's not worth their time anymore.

[Vilacom]

1 hour ago, HenrySalayne said:

Since when do streaming platforms have their own app store?

 

And games had a tendency to force their own launcher (with a separate account) in addition to a platform like Steam. This fragmentation is certainly annoying for customers, but it doesn't make it more expensive. Additionally we already see this trend ending and some major publishers are not forcing their launcher any more.

Besides the loss of comfort the only real negative of all these launchers is the loss of support and/or access once the service is gone. But that's a completely separate topic to DMA and something the EU will hopefully address in the future. A perpetual license should be a perpetual license and not just be perpetual until the developer decides it's not worth their time anymore.

They don’t yet, cause there is no point in having their own App Store while they can’t get it onto things like the iphone.  I’m referring to the change from when Netflix first started streaming, and would just pay various studios for the rights to a show or movie to have it for streaming to now where every studio/channel has their own streaming app with their own subscription model/ads/data collection.  

Nowhere did I say it would be more expensive, only that you’ll need a dozen different distribution platforms because no company is going to want to have to rely on their update getting approved by different company, pay someone else for access to their payment processor, rely on another companies algorithms to suggest being downloaded, or risk just getting removed from an App Store because of some restriction/pissed off the company that runs it/etc.  

With regards to the perpetual license, yeah maybe but wont the solution just be not offering perpetual licenses anymore?

[leadeater]

3 hours ago, HenrySalayne said:

Since when do streaming platforms have their own app store?

Not that I have followed the conversation but Netflix would be the App Store. In the past Netflix was the only real market streaming option and would have been hit, or should have been hit, with the gatekeeper status but that is no longer the case today. Either way if a streaming service got so big and had so much influence, Disney+ pending, then they could and should be deemed as a gatekeeper thus requiring any streaming service the ability to buy license fairly and compete making only the benefits of the service itself matter not the exclusive content they have which they are also the rights holder to.

 

Streaming services won't be long behind the companies mentioned in this topic legislation, they will be hit with the ire of the EU some time, it's going to happen.

[RejZoR]

21 hours ago, LAwLz said:

"why are all the blue cars I've seen slower than red cars if the color doesn't matter? I have a blue car by the way so I know they are slow". 

Um, ok whatever. You'll just keep throwing bullshit around to sound smart while not telling anything of worth.

[LAwLz]

4 minutes ago, RejZoR said:

Um, ok whatever. You'll just keep throwing bullshit around to sound smart while not telling anything of worth.

I feel like you didn't understand my analogy.

You have observed that walled gardens functions better, and the conclusions you drew were that they work better because they are walled garden. You are attributing correlation with causation, just like I did in my analogy with blue and red cars.

 

The problem with your way of thinking is that it is based on assumptions that are not correct. Apple could release the code and patents related to how their watch syncs with their phones tomorrow and it's not like it would all of a sudden not work as well anymore. Therefore, the only logical conclusion to draw is that it is not that walled gardens work better than open standards. It is all down to the implementation.

 

It might be (I am making a big assumption here) that functions and features in walled gardens oftentimes work better because they are followed more rigorously when there are fewer companies involved. But I am not even sure that said assumption is even true. There are plenty of closed and proprietary standards/protocols that work really poorly and a lot of open ones that work wonderfully.

 

Your post is just assumptions based upon assumptions, based upon even more assumptions.

The idea that walled gardens work better than more open standards is an assumption that hasn't been quantified in any measurable way. It's just you making a very limited observation on a handful of products.

The idea that they work better because they are walled gardens is also an assumption that hasn't been proven. In fact, some very simple logic disproves this, because it is based on implementation (the actual code) and not the licensing.

[leadeater]

1 hour ago, LAwLz said:

There are plenty of closed and proprietary standards/protocols that work really poorly and a lot of open ones that work wonderfully.

90% of Microsoft, anything to do with Office 365, Teams, Sharepoint, Bing, Cortana, Windows Search etc etc

[hishnash]

1 hour ago, LAwLz said:

It might be (I am making a big assumption here) that functions and features in walled gardens oftentimes work better because they are followed more rigorously when there are fewer companies involved.

The reason the walled garden approach works better in many cases is that the interface between things (like the watch and the phone) does not need to be static and does not need to be backward compatible.  Apple can update the way the phone talks with the watch with each minor iOS and watchOS update.    This massively reduces the amount of work that the teams need to do when implementing new features or even fixing bugs in existing features.  

As soon as you have a public api that others are using and you have no ability to controle their software update cycle you are stuck with either providing backwards compatibility or breaking things all the time.   Even fixing a small bug can have issues when your working with a public api as other devs may well have written thier code paths to expect this beavoir in effect turning the bug into feature for them.  

Minimising the API surface you publish publicly reduces your future headaches massively and improves that stability for users as the surface area of the api the apps users depend upon is smaller and more maintainable. 

[hishnash]

3 hours ago, leadeater said:

Streaming services won't be long behind the companies mentioned in this topic legislation, they will be hit with the ire of the EU some time, it's going to happen.

There is a little bit of difference as streaming companies tend not to pay the content creators per user that watches the content or per subscriber so they are not a re-seller like apple is with the App Store they instead out right buy the content then sell it to as many users as they can.   

[leadeater]

47 minutes ago, hishnash said:

There is a little bit of difference as streaming companies tend not to pay the content creators per user that watches the content or per subscriber so they are not a re-seller like apple is with the App Store they instead out right buy the content then sell it to as many users as they can.   

Doesn't make any difference at all to a law that is consumer oriented and to protect consumers. If for example Disney+ had 99% of all content licenses it doesn't make any difference at all how, who or why they have enough share of the market to be a gatekeeper. 

 

Also watch time and user statistics are used to calculate payment contracts on streaming services but it also entirely depends on the agreements and royalties which are in the case of every streaming service a very closely guarded secret. But as per above, makes no difference to gatekeeper designation.

[leadeater]

1 hour ago, hishnash said:

As soon as you have a public api that others are using and you have no ability to controle their software update cycle you are stuck with either providing backwards compatibility or breaking things all the time.   Even fixing a small bug can have issues when your working with a public api as other devs may well have written thier code paths to expect this beavoir in effect turning the bug into feature for them.  

You simply have major version branches and leave stragglers behind, that is the go to standard. Want the latest things as part of your project or software? Incorporate the newest major version and everything that entails.

 

That's how a lot of open source software works and it's really not a huge problem. You do however need to publish support lifecycles for major versions though.

 

I'll use Ceph as an example since that is what I'm working on right now. There are major versions of Ceph and each one can have different new feature support and not all versions are forwards and backwards compatible with everything. Then you also have Red Hat and IBM etc that take Ceph and make commercial product offerings of it that have their own code branches but are down stream from the main Ceph community code base. I could be wrong but for example Red Hat Ceph Storage major versions do not change the Ceph version they use, this product typically isn't available for the latest major Ceph version either. 

 

Neither Ceph or any products based off it are limited by each other or forced to speed up or slow down.