Apple is all too familiar with antitrust laws given its historic fight with Microsoft through the years in terms of “leveling the playing field” when it comes to PCs dominance over Mac, but now that Apple seems to have acquired the upper hand in the mobile space, can the company continue its current agenda while sidestepping antitrust inquiry?
Things have gotten interesting over the past couple years, with Apple’s iPhone carving a dominant position in the world of smartphones. With its position, it’s only logical that Apple would want to make the best of it, but a few key moves in the wrong direction could topple the ecosystem that’s hoisted the iPhone platform above its competition.
Now that mobile advertising is the so-called “new frontier” in the mobile space, competition is quickly heating up between the major players. To be dominant in mobile advertising, a mobile platform as a solid foundation plays a vital role. Apple has built that solid foundation with its iPhone platform, and it’s turned out to be the holy grail of mobile advertising potential – taking into account location, its massive mobile-app ecosystem, the hardware itself and its massive community of developers ready and willing to create and distribute the next generation of mobile innovation.
This foundation has put Apple in the driver’s seat, but only if they step lightly. AdMob was the first true mobile advertising network to focus on the iPhone and cash in on the potential the device provides, and would have been a perfect fit for Apple to acquire, but Google beat them to it. You would think the move would give Google an upper hand, but Apple had other plans – it simply bought up the next best thing: Quattro Wireless.
Here’s where things get interesting. Shortly after the sale of Quattro, Apple issued a subtle statement to developers stating that they couldn’t build applications that use location solely for the purpose of serving advertisements. While ambiguous in tone, the statement more or less told developers that baking mobile advertising into their apps was off limits – likely because Apple wanted first dibs in capitalizing on the massive potential it knows it created. Without directly doing so, Apple has more-or-less locked out all competition to keep things all to itself. If that doesn’t imply antitrust, then I don’t know what does.
The move was clearly a jab at Google, allowing Apple to assert its authority over a company that never has to bow down to anyone. AdMob (and Google for that matter) was quick in criticizing the move, releasing a statement shortly thereafter saying “Apple’s iPhone and App Store platforms have been critical in driving the growth of mobile advertising. We’ve heard about this change from a number of worried application developers and share their concern,” the company said. “We hope this is not indicative of a new approach by Apple and that many different companies will continue to have the ability to contribute to the rapid innovation in mobile advertising on the iPhone.”
While Apple’s intentions are all-too-obvious, it’s been careful in how it’s furthering its agenda. For instance, Apple made the announcement regarding the banning of in-app ads well before it said anything about its intentions with Quattro Wireless. If the company had integrated Quattro into the iPhone platform for developers, and then made the move to lock out all other ad-networks from accessing the platform, the Feds would have been all over it, but Apple seems to know what it’s doing and is taking its time.
Whatever happens next, Apple needs to be very careful. It’s clear they’re planning on topping Google in an industry that Google should have been in first, but since they didn’t, Apple will surely not pass up on the opportunity. To sidestep the consequences of an antitrust inquiry, Apple will need to take its time and think things out before getting ahead of itself. Apple could potentially keep out all competition in a ’round-about way, without explicitly doing so, but as it stands right now, Apple is primed for an antitrust fight from a standpoint they’re not used to: being the defendant as opposed to pointing fingers.
