Saint Steve? Not Exactly. Apple and the Power of the Dark Side

10/7/11Follow @wroush

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fit the purpose at hand. If one line of argument failed to persuade, he would deftly switch to another. Sometimes, he would throw you off balance by suddenly adopting your position as his own, without acknowledging that he ever thought differently.”

It worked for him. As Jobs famously said, claiming that Apple did no market research for the iPad, “It isn’t the consumers’ job to know what they want.”

Jobs the Toll Collector

Jobs established a market-making platform for content sales and consumption with the iPod, iPhone, and iPad, and Apple hasn’t been shy about exacting a pretty hefty toll for the privilege of reaching those consumers. Apple’s standard cut for sales through its App Store was long established at 30 percent. But things really got interesting earlier this year when Jobs announced that the same revenue split would apply to subscriptions, music, or books sold through apps on its platforms. And it was willing to go pretty far to enforce those terms: Publishers were not allowed to offer links outside the app to skip the revenue-share, and weren’t allowed to offer better prices outside the app either. Publishers also couldn’t get basic subscriber information without an additional opt-in by consumers.

That roiled content publishers and sellers of all types. “It’s pretty simple math: they’re asking us to sell a product for less than it costs to deliver it,” said Rhapsody president Jon Irwin, whose company also said it would explore legal options. And that was actually a pretty tame response, compared to the F-bombs coming from the co-founder of Last.fm; “[A]pple just f****** over online music subs for the iPhone,” Richard Jones wrote in an IRC chat. The Wall Street Journal also reported that the price controls could raise antitrust scrutiny. Amazon was among the companies that responded by building a Web app—and earlier this month, its own tablet, to control more of the content-selling and serving ecosystem.

Jobs the Censor

As profitable as it is for Apple, the iTunes App Store wasn’t part of Jobs’ original vision for the iPhone. Concerned that third-party apps might interfere with the device’s basic functions, he initially restricted app developers to creating services that users could access through the phone’s Web browser. “These are devices that need to work, and you can’t do that if you load any software on them,” he told the New York Times in 2007. “That doesn’t mean there’s not going to be software to buy that you can load on them coming from us. It doesn’t mean we have to write it all, but it means it has to be more of a controlled environment.”

Apple later eased those controls—but has never fully lifted them. Editorial cartoonist Mark Fiore learned that this spring, when Apple rejected an app he’d built because it contained cartoons that satirized public figures. Apple said the app violated the terms of its developer agreement, under which it’s free to ban apps it finds “objectionable”; the company relented only after Fiore won the Pulitzer Prize.

“Apple has built a little slab of Disneyland with its iPad, which is meant to be an experience unsullied by provocative or crude material,” commented Wired writer Ryan Singel. “It’s beautiful and enticing…but it’s not the real world.” Singel is far from the only observer to have called attention to Apple’s seemingly paternalistic attitude toward toward the app ecosystem it created. Free software advocate Richard Stallman, in a comment on my 2010 column about the tension between openness and control at Apple, wrote “I doubt the term ‘open’ fits the censorship of the Apple app store…Apple is the pioneer in putting chains on its users.” Yet these same controls help guarantee a wider global market for iOS devices.

Jobs the Police Sergeant

When Apple feels that its trade secrets are under threat, it’s not above taking heavy-handed measures to protect them. In 2005 the company sued ThinkSecret, a Mac rumors and news site, for publishing leaked information about an unreleased Mac model; in a legal settlement two years later, ThinkSecret agreed to shut down. In April 2010, after Gizmodo blogger Jason Chen paid $5,000 for an iPhone 4 prototype that had been misplaced at a Bay Area beer garden by an Apple employee, San Mateo County sheriff’s deputies got a search warrant to enter Chen’s home and … Next Page »

Wade Roush is a contributing editor at Xconomy. Follow @wroush

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