Apple, The New Terms and Antitrust

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I am interested in what everyone is thinking and would like you to
share your thoughts. Below I have detailed the recent controversy over
the past couple of months in relation to Apple, Flash and other issues
with the App Store's Terms of Service. Please read it through,
including the linked articles to come up to speed (if you have not
been following along) and post your thoughts. I have been finding that
Twitter has not been the best way to discuss this topic very
effectively so I wanted to cover it here.

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The heated issue over Flash on the iPhone has now raised antitrust
concerns. According to the following article the main issues are
around requiring developers to use Apple's developers tools as well as
new restrictions around apps that strong arms developers into using
iAds.

http://www.pcworld.com/article/195527/apple_to_dodge_antitrust_bullet_report_says.html

In recent months the time to get an app into the App Store, if it
makes it through the review process successfully, has gone from over 2
weeks to as short as a couple of days. A new feature in Xcode 3.2 is
Build and Archive which assists with creating Ad Hoc deployments as
well as reviewing your app and preparing to submit it for the App
Store review process.

http://iphonedevelopment.blogspot.com/2010/05/xcode-32-build-and-archive.html

In recent months it appears that Apple now does automatic analysis of
an app to ensure it does not use private APIs which are restricted and
check other technical criteria which would force a rejection of your
app. This automatic validation process allows them to approve or
reject an app much more quickly. This same analysis appears to also be
built into Xcode 3.2 account to the above blog posts. For developers a
major frustration is submitting an app and then just waiting for what
could be days or weeks and not knowing if the app will be accepted.
The frustrating delay that is caused by the review process appears to
be less of a frustration and perhaps these static analysis tools will
further reduce this frustration. It appears that Apple will still
manually review apps for details that automated tools cannot review.

The 2 major issues remain of Apple's new terms to reject any apps
which are built with Adobe Flash CS5 or Mono Touch and the new terms
which put your app at great risk if you are using geolocation and user
data to place ads in your app.

Most have now read the open letter Steve Jobs wrote called Thoughts on
Flash in which he makes it clear Apple's position on Flash for the
iPhone.

http://www.apple.com/hotnews/thoughts-on-flash/

On a Mac or PC you just have to watch your processor usage and fire up
YouTube or Hulu to see the impact of watching video does on your
processor. Adobe is arguing that by not having Flash on the iPhone or
iPad most users are missing out on video from many web sites. Since
the iPhone and iPad can view H.264 video directly and Flash has
supported it since Flash 9 most sites can simply use that video codec
for Flash and the iPhone/iPad. This site details the numbers on H.264
usage in relation to other video options.

http://www.tipb.com/2010/05/01/h264-ascendant-apples-noflash-notheora-gamble-pay/

Since Apple and Microsoft will be supporting H.264 it appears that it
is becoming the de facto standard while the native Flash video format
is becoming obsolete quickly. The fact that H.264 runs well if you
have hardware support reduces CPU and battery usage.

In response to Thought on Flash the Adobe CEO contends that Apple is
using these technical issues as a smoke screen in this interview.

http://blogs.wsj.com/digits/2010/04/29/live-blogging-the-journals-interview-with-adobe-ceo/?mod=wsj_share_digg

He contends that Adobe is working hard to create a multi-platform
solution for application development that works well on Android and
other devices already. He does not directly address HTML5. He would
like Apple to simply allow Flash applications built with CS5 to run on
the iPhone and installed through the App Store. Naturally this would
be in Adobe's interest while Apple's position is that any abstraction
layer over their native APIs results in what they consider sub-
standard applications.

Obviously both Adobe and Apple argue they are doing what is best for
consumers. It appears that consumers may not all agree on what they
want. Some do like a strong native app which conforms to what Apple
considers a good User Experience. Meanwhile other consumers feel that
having the same app run on the iPhone, Android, Mac and Windows is the
way to go. Adobe and Apple are motivated to maximize consumer
satisfaction and, as a business, earn as much money as possible with
their offerings. In this context there may not be a win-win scenario.

Due to Apple's very restrictive new Terms of Service there is talk of
an antitrust investigation which is partially covered in the first
link above.

This with either fizzle out quickly (unlikely) or turn into a 5 year
battle that possibly resembles the antitrust case against Microsoft
over Internet Explorer so many years ago. By the time Microsoft had to
take action the damage was already done. The question here is whether
Apple is damaging Adobe by blocking Flash? And are consumers hurt by
not having Flash on the iPhone and iPad? And what about HTML5 which is
an open and multi-platform solution that has rich support for some
native features like geo-location, local storage and video playback.
Unfortunately HTML5 does not provide access to the device's address
book, calendar or other native features which are not abstracted by
HTML5. So it does not truly provide everything that a native iPhone/
iPad app could do, so you often have the requirement to jump all the
way to developing native apps in Objective-C with Xcode.

It seems like a big mess. What are you thoughts on this Flash issue?
Please respond below.

Another concern is over the iAds terms. Due to iAds it appears that
Apple is putting more restrictions on any ads you use to fund your
apps development. A few months back Apple announced that if you use
the device's location data to display location-based ads you risk your
app being rejected from the App Store. The new terms state that you
cannot share user data with the Third Party advertisers. These terms
lead you to use iAds which sends a 40% cut of the revenue to Apple.
You do not seem to have another option under these new terms. Other ad
networks like AdMob are directly affected. This appears to be one of
the clearest arguments for antitrust violations.

Do you think Apple should rewrite these terms in relation to ads?
Please respond below.

Finally, the App Store review process remains the single biggest issue
for application developers and the businesses that want to get their
apps into the App Store. Is there anything that can be done short of
dropping the manual review process completely? What if all apps were
accepted if they pass the automated analysis and the 5 star rating
system was simply used to raise the better apps to the top. I'd be
happy to set the search feature to only show apps which are above 2
stars so that I can ignore any bad apps. Meanwhile app developers can
still directly link to their apps in the App Store for distribution.
Allowing all apps which pass the static analysis would at least
eliminate complaints that Apple is arbitrarily blocking apps.

What do you think?

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