Former Labor Secretary to FTC: “Hands off Apple”

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Robert Reich
Robert Reich

Robert Reich, former U.S. Labor Secretary and current Professor of Public Policy at the University of California at Berkeley, has penned an editorial taking the Federal Trade Commission (FTC) to task for even considering going after Apple for forbidding some third party development tools for iPhone OS apps. According to Professor Reich, the U.S. needs companies like Apple and people like Steve Jobs, and he thinks that it’s the four large Wall Street banks that need examination instead.

Professor Reich is referencing a story from earlier in the week that the FTC and the Department of Justice (DoJ) were considering which agency should begin an inquiry into Apple’s decision to ban Flash and other third-party app development tools that don’t directly use Apple’s own APIs.

“What’s wrong with that?” he asked. “Apple says it’s necessary to maintain quality. If consumers disagree they can buy platforms elsewhere. Apple was the world’s #3 smartphone supplier in 2009, with 16.2 percent of worldwide market share. RIM was #2, with 18.8 percent. Google isn’t exactly a wallflower. These and other firms are innovating like mad, as are tens of thousands of independent developers. If Apple’s decision reduces the number of future apps that can run on its products, Apple will suffer and presumably change its mind.”

He added, “Our future well being depends more on people like Steve Jobs who invent real products that can improve our lives, than it does on people like [JP Morgan Chase & Co. CEO] Jamie Dimon who invent financial products that do little other than threaten our economy.”

The piece also delves into Professor Reich’s position that any U.S. bank that is too big to fail should be broken up so that it’s simply no longer too big. You can find his full arguments at his personal site.

The mixture of Apple, the FTC, and banking is partial misdirection in that the FTC has no power to regulate the financial sector, as he himself pointed out in the editorial. Be that as it may, he closed the piece with a simple, “Hands off Apple. But cut the big banks down to size.”

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Comments

iVoid

Sounds like a typical Apple fanboy rant. smile

RoberBarnes

iVoid - invent something, then give me a call.  Otherwise - you add nothing to the party. What’s the opposite of a FanBoy? - a “Dream Stomper”.  Someone who never dreams up anything that makes the world a better place, just slings mud and FUD at anyone who celebrates the good that people do.

Your mileage may vary.  But you wasted my time with your comment.

Nemo

While not embellished in the style of antitrust litigators, Professor Reich’s point that Apple doesn’t have enough market share in the market for smartphones to make out an antitrust violation is well said and well taken.  That added to the pro competitive effects of the new Section 3.3.1 of Apple’s iPhone OS 4.0 SDK Agreement of (1) enhancing differentiation among smartphone OSs and so enhancing competition among those OSs and (2) providing the new and sole open-source competition to Adobe’s Flash and AIR in the market for tools for video and interactive content on the Internet gives, I think, Apple an overwhelmingly strong defense to any antitrust case.

iVoid

RoberBarnes - Wow, you need an anger management class fast.

NE1956

Duh to the naysayers.  It’s Apple’s product.  Apple has the right to say no to crap.  I use Firefox when I’m on the Internet SPECIFICALLY because I can block Flash (or unblock it at my whim). 

Apple apps DO NOT NEED Flash or 3rd party apps that won’t talk to it’s API.  The API is what gives us decent apps to begin with.  I’d rather have 1000 good apps than 10,000 crummy ones.

I agree whole-heartedly that Apple should be left alone.  It’s their product.

xmattingly

Spoken like a true Libertarian. wink

Mike

RoberBarnes:  well said. 

iVoid: One must assume that your onscreen moniker is a description for your cranium.  Why bother posting if you don’t have anything to add to the discussion?

Reich is, as usual, spot on.  He is not defending Apple, he is wisely looking at the situation and correctly noting that Apple isn’t hurting anyone by offering its products to the marketplace the way it wants to deliver them. There are a hundreds of capabilities that EVERY electronics manufacturer must assess in product development.  Apple’s success only underscores the point that their recent hot-selling products included very good tradeoffs.  Regardless of how good or bad Flash really is, if Flash truly was necessary, then the public will buy competitive products that support this technology.  But eventuall most electronics technology does become obsolete, this is reality.  This is the real news here, that finally someone (Jobs) had the guts to publicly say what many of us sense: Adobe has indeed become complacent in much of its product refinement, especially those software packages that it didn’t develop from scratch.  In vainly attempting to defend its creakiest product line, Adobe risks becoming an inconsequential purveyor of obsolete MacroMedia technology.  As it is, many consumers actively block annoying Flash ads on their computers to reduce the annoyance and waste of system resources. It is surprising that Adobe and many media (advertising company) developers are truly ignorant of their unpopularity by refusing to give users the option of a stable, uncluttered, low-impact video experience. 

Kudos to Apple for again being the first to elevate product standards.  Apple is a leader in electronics design, not a monopolist.  You may recall that they were the first manufacturer to drop the magnetic floppy disc drive and offer USB.  Does this make them “anti-competitive”? 

If one feels the need to whine about Apple’s design options, why not also register complaints to all major electronics mfrs that none of their current products include SCSI and serial cable connectors too?

xmattingly

Reich is, as usual, spot on.? He is not defending Apple, he is wisely looking at the situation and correctly noting that Apple isn?t hurting anyone by offering its products to the marketplace the way it wants to deliver them.

Yep, it seems that this “investigation” nonsense is wrapped around the idea that Apple is trying to control a market. Well news flash, FTC: Apple is not controlling a market place: they are controlling their own platform, which is no different from what game companies have been doing with their systems for years.

This would leave the door open for me to go on a big rant about effective government bureaucracy, but I’ll digress… I’ll just say that this kind of bull is a big waste of tax dollars.

dhp

I don’t care about this issue very much, but Robert Reich is a frickin’ genius.

YankInOz

iVoid - obviously you enjoy the troll tromping:
Why would you make such a statement on a Mac dedicated website unless you were hoping for your fifteen picoseconds of fame?

If it wasn’t for Steve Jobs and Apple’s innovations, you would still be looking at a C-Prompt “C>”

This may be a little ditty that you want to download and read often because it is (to me) an apt poem for you. I don’t remember where I found it but I knew it would be of use one day and I found it so easily with Spotlight…

Just for you:

Here’s to the dull ones. The luddites. The tedious. The non-achievers. The square pegs in the square holes. The ones who refuse to see things differently. They?re extremely fond of rules. And they’ll do anything to maintain the status quo. You can praise them, disagree with them, quote them, disbelieve them, glorify or vilify them. About the only thing you can?t help but do is to ignore them. Because they never change things. They don’t invent. They don’t imagine. They don’t heal. They don’t explore. They don’t create. They don’t inspire. They retard the progress of the human race. Maybe they have to be boring, unimaginative, a-holes. How else can you stare at an empty canvas and see nothing whatsoever? Or sit in silence and hear nothing at all? Or gaze at a red planet and not even see it? While some see them as the dull ones, we see criminals. Because the people who are uninspired enough to think they can never change a thing, are the ones who hold us all back.

geoduck

I’ve always respected Robert Reich. This just raises his stock even higher in my estimation.

iVoid is just a troll without a clue.

iVoid

Wow… I was going to let this thread drop off my radar, but I’m amazed at how much hate and anger some of you have over a real short message said in jest (note the smiley face).

BTW, personal attacks just make YOU look very small.

My main point in posting that was a light hearted response to some of his quotes. For instance: “Apple says it?s necessary to maintain quality.” just reminded me of some Apple ‘fanboys’ that take everything Jobs or Apple says as gospel.

For the record, I am a creative person. I program, write short stories, and create computer graphics… with my MAC.

For the record, I predate the Mac in my support and being a customer of Apple.

For the record, I supported Apple through the rough years of the 90’s when it was pretty hard to find the silver lining. But that support wasn’t blind support. When I saw a problem with Apple, I was honest about it and tried to work to make it better.

For the record I don’t particularly want Flash on the iPhone OS. I block it on my Mac unless I have to let it through to see some badly done website. And to block ads. Ironically, while people say lack of flash allows them to surf without flash ads cluttering up the place, Apple is going into the advertising business. Think they’ll allow apps that block iAds? smile

As for blocking creativity and stifling innovation, some of Apples recent moves directly HAVE stifled creativity and innovation. Their very heavy handed app approval process HAS resulted in people not being able to express their creativity in Apps for a long list of reasons.

As for the Flash compiler issue at the center or this, I don’t have any problem with it. I doubt many people could even identify the apps already in the App store that used the Flash compiler to make their apps. Or why they are ‘substandard’.

And, FYI, the Flash compiler does NOT go around Apple’s APIs (at least I’ve never seen any indication that it talks directly to the hardware, bypassing the APIs)), it just translates the Flash code into code that then calls Apple’s APIs. Basically it adds code to the Flash code that calls the APIs the way Apple wants them to be called.

So, I actually don’t care about getting Flash on the iPhone OS.

But I do think Apple is being a bit heavy handed in locking out 3rd party development tools. I remember when they were begging for Mac developers and don’t think pissing off potential iPhone developers is a good long term strategy.

Yes, while iPhone is on top Apple can get developers to grovel at their feet, but they can’t stay on top forever.

geoduck

iVoid
You are correct. I didn’t catch that you were saying it in jest. I apologize for jumping to conclusions.

daemon

Steve Jobs said you should buy Android.

spudgeek

There’s a lot of chatter about Apple’s increasing totalitarianism and zestful greed. If true, this could be cause for concern in a few years when it’s hard to reverse. It is obvious that Apple is protecting its wares and brand which requires more heavy-handedness with consumer growth and popularity. I get the perspective that Apple/SJ declares but obviously not everybody does… and I could be wrong.

The FTC might see it this way also and is likely getting pressure to look into it. The FTC have not ruled anything yet; they will investigate and I guess that they will see that Apple is not trying to be anti-fair-trading or monopolistic - they are just protecting their wares and brand in which case they’ll get the all clear and a few brownie points. A gold star from the FTC will quieten the chatter and negative publicity and Apple can grin from its pulpit saying “I told you so”.

I don’t wish an FTC investigation into Apple but I don’t see it as a bad thing either… it could be an opportunity for Apple to dampen the naysayers.

Mr. Reich is correct when he says that many companies are being innovative in the same markets as Apple and we all know that they wouldn’t be as innovative without Apple. Apple is a terrific leader in the technology field, all other major players are following the Apple brick road. Without the iPhone, there would be no Android or WebOS; RIM would still be pushing dull email handhelds; Microsoft wouldn’t have Windows 7 perform as well as it does. You’re right Robert, the world needs Apple and more companies like it, and more leaders like Steve Jobs who doesn’t focus only on the bottom line as the measure of success.

fultonkbd

But I do think Apple is being a bit heavy handed in locking out 3rd party development tools.

I don’t know the answer so these are legit questions… So Apple is locking out ALL 3rd party development tools? So there are no 3rd party tools that build whatever code Apple wants developers to use?

Just seems like Apple wants developers to use certain coding languages to me to ensure a quality product.

Every body complaining about this sounds sorta like going to a different country then complaining that they don’t speak your language.

ctopher

well shoot, I laughed at iVoid’s comment. I thought it was perfect for a mac oriented site. Maybe it’s because I’m a native English speaker and I’ve read one too many “fanboy rant” put downs lately, but I saw the sarcasm.

Robert Reich. Fanboy? It’s hilarious. (Although, with his physical stature, he is more “boy” smile ) <- Parenthetical short person joke (ish).

John Dingler, artist

Clinton?s first Labor Secretary, Robert Reich, was prescient to resist Greenspan’s push to deregulate Wall Street and its elimination of Gless-Stiegel thanks to Rightwing seditionist Phil Graham.

Reich is also correct to hold up Steve Jobs and Apple Corp. as models of good capitalism.

Terrin

Apple’s claim isn’t that FLash goes around Apple’s APIs. Apple’s claim is that Adobe will only support Apple APIs that are common on all platforms [e.g. the lowest common denominator] and ignore platform specific APIs.

That is counter to Apple’s interests because as a hardware manufacturer it spent millions of dollars creating over 1500 new APIs for it’s iPhone 4 OS so that it’s platform will stand out. The last thing it needs is Adobe ignoring all those APIs.

Adobe could care less if a person buys an iPhone or Android phone. It just wants developers for both platforms using it’s tools. Contrary to Adobe ‘s claims, that undermines competitions by 1) undermining hardware developers abilities to distinguish their products, and 2) allowing application developers to not make platform specific applications. The competition then mere is between what development tools to use. Adobe will win that game because most developers don’t really want to compete.

Apple isn’t shooting for the same. It is shooting for better quality applications so that it’s hardware stands out. 

And, FYI, the Flash compiler does NOT go around Apple?s APIs (at least I?ve never seen any indication that it talks directly to the hardware, bypassing the APIs)), it just translates the Flash code into code that then calls Apple?s APIs. Basically it adds code to the Flash code that calls the APIs the way Apple wants them to be called.

HereWeGo

Well, I don’t see much of a difference here between the US Gov vs. Microsoft antitrust deal.  The precedence was set when the anti-Microsoft/IE crowd went after Windows and Internet Explorer being a part of it.  This is worse, as Microsoft never kept you from installing opera, netscape, firefox, etc…

geoduck

Well, I don?t see much of a difference here between the US Gov vs. Microsoft antitrust deal.

There’s a huge difference. Microsoft was found to have a near monopoly and by no stretch of the imagination would Apple qualify as a monopoly. At the time of the US v. MS action MS had something like 90% of the desktop PC market. There was an article earlier today about how Apple has 16% of the SmartPhone market.

HereWeGo

There?s a huge difference. Microsoft was found to have a near monopoly and by no stretch of the imagination would Apple qualify as a monopoly. At the time of the US v. MS action MS had something like 90% of the desktop PC market. There was an article earlier today about how Apple has 16% of the SmartPhone market.

As I remember, the focus was how Microsoft’s inclusion of IE was anticompetitive.  I don’t see how keeping Adobe Flash off of the iPad isn’t.  They seem to be apples from the same tree in the eyes of the law, or at least one court ruling, regardless of market share, the behavior is the same.

geoduck

Because when MS was forcing Windows users to use IE it impacted nearly 100%of the personal computer market. If you want to use Flash, get an Android phone. There are lots of them around.

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