The Techlash is Coming for Apple

After watching Amazon, Facebook, Google, get hammered by critics — and encouraging it when convenient — Apple gets its turn under the bright lights.

Hi Everyone, this week’s newsletter was supposed about why everyone wants in on social audio. But then, I watched a remarkable hearing Wednesday and felt compelled to write about it. So this week, we talk about the forthcoming Apple backlash.

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The Techlash is Coming for Apple

Apple’s life is getting complicated in a hurry. With a combination of masterful marketing and luck, the $2.22 trillion company managed to avoid the backlash that’s targeted Amazon, Facebook, and Google in recent years. But its good fortune and public relations magic appears to be running out, and a reckoning seems imminent.

The problems Apple is running into were on full display Wednesday, as representatives from Spotify, Tile, and Match Group — all of whom rely on Apple to reach customers — castigated it before the Senate. Apple, they said, is abusing its market power, harming their products, and, most importantly, hurting their customers. They attacked Apple with a fury it hadn’t seen in recent memory, at least in public.

“Apple’s idea of competing is patently unfair,” Tile general counsel Kirsten Daru told the Senate, delivering her remarks just one day after Apple introduced a Tile copycat. Apple, she said, prevented Tile from using a technology called Ultra-Wide Band that would help its users find their lost items. Then, Apple used that same technology for its Tile competitor. The Senators in attendance seemed receptive as Spotify and Match delivered similar barbs. Sen. Amy Klobuchar, who led the hearing, invoked the Justice Department at one point.

Apple is getting its turn in the bright lights as the “techlash” evolves. Once a reaction to the tech giants’ power over online speech, the backlash has turned into a serious antitrust movement looking well beyond the questions that originally animated it. With Donald Trump out of office, the speech wars have cooled down a bit, and the wonkier questions of competition policy remain. This is where things get hairy for Apple.

Critics have always struggled, somewhat, to detail the clear harm Facebook, Google, and Amazon did to the end-user. Facebook and Google dominate digital ad markets, but their products are free, and it takes some explaining to show how they’re hurting small businesses, and hence the consumer. People love Amazon’s low prices, and it takes a discussion of how it treats suppliers and workers to get you to why its power can be harmful. Apple’s anticompetitive practices are a bit easier to link to direct harm to actual people.

Unlike Google’s Android, Apple forces its app developers to go through its App Store, and it exerts a lot of control over them. Some developers say that Apple privileges its own products, forces people to pay more for their services when using App Store, and doesn’t let them communicate that their products are cheaper elsewhere. When Tile’s product doesn't work well because Apple wants its own device to thrive, that’s a problem. Spotify's chief legal officer Horacio Gutierrez said Apple’s App Store policies are an "abusive power grab and a confiscation of value created by others." The result, critics say, is that Apple users, at times, get worse and more expensive services due to Apple’s excesses.

Apple, of course, has delivered value to app developers. To some degree, the App Store is curated, helping people trust apps that make it through the review process. And Apple Pay makes payments as easy as staring at a screen for a second and then double-tapping. But for some time now, companies have questioned whether the money and control Apple demands in exchange for the opportunity to operate on its devices is fair — and whether that price ultimately hurts us, the end-users.

Now, after years of appeasement, companies fed up with Apple’s practices, including Tile, Spotify, Match, Epic Games, Facebook, and others, are finally voicing their disagreements in public. The debate over Apple’s power is exploding out into the open.

Further reading:

Podcast Subscriptions vs. the App Store (Stratechery)

Apple Is Expanding Its Ad Business (Ad Exchanger)

Apple is lobbying against a bill aimed at stopping forced labor in China (Washington Post)

News Briefs

Robinhood, Three Friends and the Fortune That Got Away (Wall Street Journal)

The story of the stock market’s wild ride is easy to tell in numbers, but hard to tell through actual people. In this story, Rachel Louise Ensign gets ahold of a group of friends who traded their way through the market’s recent madness, placing early bets on Gamestop and other speculative stocks via Robinhood. This article is an illuminating walk through how this all plays out on the ground. It shines because it’s non-judgemental, human, and fun.

Welcome to the YOLO Economy (New York Times)

Kevin Roose, a two-time Big Technology Podcast guest, wrote a terrific piece about how young people who’ve spent the early part of their lives climbing the career ladder are now opting out. They’ve spent the pandemic telling themselves that life doesn’t have to be the way they planned, and are dropping out of the system and doing their own thing. Some will eventually have to return to their old occupations, others will find exciting new lives but, heck, they’re going for it. As someone who sort of YOLO’d his way into Substack life last year, this resonates.

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This week on Big Technology Podcast: Facebook vs. Clubhouse vs. Spotify vs. Apple: Casey Newton Returns

Platformer's Casey Newton returns to Big Technology Podcast to discuss the intensifying battle among Facebook, Clubhouse, Spotify, Apple, and Twitter in the new, social audio space. Fresh off a conversation with Facebook CEO Mark Zuckerberg, Newton discusses Facebook's plans, Clubhouse's potential for longevity, and what empowering the individual vs. the institution really means. Plus, we discuss this week's big Apple release event.

To subscribe to the podcast and hear the interview for yourself, you can check it out on Apple, Spotify, or wherever you get your podcasts.

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