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Apple’s “monopsony” power, and the woman who named it

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Re: Apple’s “monopsony” power, and the woman who named it

#31

Post by CobrastanJorji »

vturner wrote: post #6

The key point I presume is the definition of "market" here; and I'm not convinced the market "software that runs on iOS" is so large that monopwhatever can be declared there and used to justify price control. Though as a thought experiment Apple is like a wealthy landed gentleman who sets up a well maintained outdoor market for the tradesmen to bring goods and the lower classes to buy them. If Apple owns so much land…

The market is too small? Let's try comparing it to a more "conventional" market, like cable TV.

Total iOS app store revenue is somewhere within the neighborhood of $50-100 billion per year. That puts it roughly on par with the US's cable television industry.

There are about 100 million people using iPhones in the US alone. That's about twice the number of cable TV households in the US.

So, it seems like the market for iOS apps is similar to the market for cable TV, and there's also less competition, as I may have other options for getting TV shows, but I don't have any other options for getting apps onto my iPhone.

Re: Apple’s “monopsony” power, and the woman who named it

#33

Post by e_y_ »

DagAgren wrote: post #25
stuaxo wrote: post #17

Earlier quoted context omitted.

Yes, this is true. People forget that there were phones before the iPhone decided all phones would be rectangles with touchscreens. Those phones ran apps and games, and you downloaded them from app stores... there was in fact a cambrian explosion of app stores, when you made software you had to publish it to hundreds of them. I can't remember the %, but it seems unlikely, in the fact of all that competition that it w…

There were not really any public app stores like the Apple one. And cuts were, in general, much higher. Apple's app store took off so well because it offered a much better deal than the competition.

Apple's App Store didn't really have competition. The iPhone was pretty much an entirely new class of smartphone. The sheer volume of users compared to early smartphones meant you could sell an app for $1.99 and make loads of money, compared to Palm/WinMo apps that were more like $10+.

It took off because it was a good experience (one stop shopping) and because of the popularity of the iPhone. And of course it doesn't hurt that it was the only App Store for iOS.

Re: Apple’s “monopsony” power, and the woman who named it

#34

Post by JamesBarney »

thaumasiotes wrote: post #20
e_y_ wrote: post #11

Earlier quoted context omitted.

I don't think we need to divide the market into specialized segments (iOS devices, luxury smartphone, etc) to make the case against Apple. They have somewhere around 50% of the global market in terms of smartphone revenue (not devices shipped). For the App Store, which is what matters to developers, revenue was around $25 billion in the first half of 2019, vs $14 billion for Google Play Store. It's not literally mono…

> They have somewhere around 50% of the global market in terms of smartphone revenue (not devices shipped). On a monopoly/monopsony theory, devices shipped is the relevant metric, and revenue isn't.

Are you sure? I was looking for this and everything mentioned market share but it didn't specify unit vs revenue market share.

Re: Apple’s “monopsony” power, and the woman who named it

#36

Post by thepangolino »

DagAgren wrote: post #25
stuaxo wrote: post #17

Earlier quoted context omitted.

Yes, this is true. People forget that there were phones before the iPhone decided all phones would be rectangles with touchscreens. Those phones ran apps and games, and you downloaded them from app stores... there was in fact a cambrian explosion of app stores, when you made software you had to publish it to hundreds of them. I can't remember the %, but it seems unlikely, in the fact of all that competition that it w…

There were not really any public app stores like the Apple one. And cuts were, in general, much higher. Apple's app store took off so well because it offered a much better deal than the competition.

This is just wrong. Nokia had the Ovi store launched at around the same time as Apple’s App Store. Palm OS also had its own if I remember correctly.

Re: Apple’s “monopsony” power, and the woman who named it

#38

Post by hellofunk »

JamesBarney wrote: post #34
thaumasiotes wrote: post #20

Earlier quoted context omitted.

> They have somewhere around 50% of the global market in terms of smartphone revenue (not devices shipped). On a monopoly/monopsony theory, devices shipped is the relevant metric, and revenue isn't.

Are you sure? I was looking for this and everything mentioned market share but it didn't specify unit vs revenue market share.

This has been well documented for years, the average iOS app earns nearly a multiple of close to 10 what other mobile platforms earn. Their share of revenue from apps is massive compared to their market share of devices.

Re: Apple’s “monopsony” power, and the woman who named it

#39

Post by fenomas »

DagAgren wrote: post #25
stuaxo wrote: post #17

Earlier quoted context omitted.

Yes, this is true. People forget that there were phones before the iPhone decided all phones would be rectangles with touchscreens. Those phones ran apps and games, and you downloaded them from app stores... there was in fact a cambrian explosion of app stores, when you made software you had to publish it to hundreds of them. I can't remember the %, but it seems unlikely, in the fact of all that competition that it w…

There were not really any public app stores like the Apple one. And cuts were, in general, much higher. Apple's app store took off so well because it offered a much better deal than the competition.

I can only speak for Japan, but all three major carriers here had app stores years before the iPhone launched.

(Apple's may have been the first store operated by a hardware maker rather than a carrier though.)

Re: Apple’s “monopsony” power, and the woman who named it

#40

Post by [deleted] »

JamesBarney wrote: post #18
vturner wrote: post #6

The key point I presume is the definition of "market" here; and I'm not convinced the market "software that runs on iOS" is so large that monopwhatever can be declared there and used to justify price control. Though as a thought experiment Apple is like a wealthy landed gentleman who sets up a well maintained outdoor market for the tradesmen to bring goods and the lower classes to buy them. If Apple owns so much land…

Large by what measure? Size of the market in dollar amount? % of market?

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