Apple continues to rule the world of apps and even the richest man in the world has to give in

The outcome of the recent battle fought on Twitter by Elon Musk shows that Apple continues to rule the world of applications, along with Google, and even the richest man in the world has to give in to keep the good neighborhood. Earlier this week, Musk criticized Apple for censorship and charging excessive fees, claiming they threatened to “pull Twitter out of their App Store” without explanation. Two days after starting the war, however, Musk paid a friendly visit to the company’s headquarters. “Thank you Tim Cook for having me for a tour of the beautiful Apple headquarters,” he tweeted Wednesday night (30), with a video of the location.

“Good conversation. Among other things, we resolved the misunderstanding about the possible removal of Twitter from the App Store. Tim made it clear that Apple never thought of doing this”, added Elon Musk, without giving details if Twitter gave in at any point in its moderation rules. But Musk’s effort to reach an agreement with Apple is justified.

In January 2021, Apple removed the application from its online store from the social network Parler. The reason was the alleged lack of rigor in comment moderation, at a time when protesters had invaded the Capitol and supporters of the occupants used the platform to defend them. The arm wrestling lasted two months, at the end of which Parler changed its policy for controlling posts and replies. Winning, Apple returned its customers’ access to the service.

Last Monday (28), Elon Musk posted that “Apple pretty much stopped advertising on Twitter. Do they hate free speech in America?”, tagging the CEO of Big Tech: “What is going on here, Tim Cook?”. On the same day, he opened a poll on the social network, asking if “Apple should publish all censorship actions taken that affect its customers”. There were more than 2.2 million votes and almost 30% answered in the affirmative.

In response to Musk, accusations of censorship such as the from LBRY, owner of alternative video platform Odyssey. “During Covid, Apple required our apps to filter back some search terms. If we didn’t filter the terms, our apps wouldn’t be allowed in the store. Apple can make good products, but they oppose freedom of expression for some time”, said the post, shared by the owner of Twitter.

Days before, Phil Schiller, Apple executive, who leads company events and manages the app store, deleted his Twitter account without notice or explanation, which suggested Musk had reason to be concerned.

Apple does not produce posts on Twitter . Historically, the company has not been active on social media. But it advertises in all the major ones, consistently and expressively. According to The Washington Post, in the first quarter of 2020, it invested US$ 48 million in ads on Twitter, more than any of the advertisers on the social network.

Incidentally, since Musk formally purchased the social network, half of the top 100 advertisers have stopped advertising for the company, according to a survey carried out by the NGO Media Matters for America. Together, these companies have invested US$ 2 billion in the platform since 2020.

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Digital ecosystem

But the impact goes beyond the ads. More than that: the Apple and Google app stores are the primary source of access to services for thousands of companies around the world. If its stores stop providing a certain application, the trend is that it is doomed to disappear, or at least find it difficult to gain scale. Google currently serves 3.5 billion apps, Apple 1.6 billion and Amazon 483 million. But Apple delivers better average profitability to its partners.

“In the new concept of digital ecosystem, we have platforms built on top of other platforms, which jointly create value”, evaluates Nicolo Zingales, professor of Law and Information Regulation, coordinator of the e-Commerce Center at FGV Direito Rio and organizer of the book The application of antitrust law in digital ecosystems: challenges and proposals.

It is not the same as what happened with industrial production chains, he describes. “Before, a company received inputs from several others and made products for final consumers. Today, the companies that lead the megaplatforms, such as the Apple Store, establish contractual rules and technical standards that their suppliers must comply with, compulsorily”, he compares.

It turns out that distributors are aware of their power. “Platforms want wide publicity of the terms of use and the application of rules”, explains the professor. “That’s why many brands decided to leave Twitter. They don’t want to have content associated with platforms that don’t follow the regulatory pressure of the market”, he explains.

For that reason, before Musk’s friendly visit to Apple, the governor of Florida, Ron DeSantis, already had reacted: “Musk opened the social network to freedom of expression and is restoring many accounts that were unfairly and illegitimately suspended”, he claimed. “If Apple reacts by pulling the app from its store, it would be a huge mistake and a demonstration of monopoly power that would present a challenge to the US Congress.”

No way out

Another episode makes it clear how much Musk found himself worried about pressure from Apple. In 2020, when Epic Games, developer of Fortnite, one of the most popular games on the planet, decided to circumvent the Apple Store billing rules and ended up banned from the store. In reaction, it filed an antitrust lawsuit against Apple.

It ended up winning, in September 2021, but was still ordered to pay US$ 3 .6 million that had not been collected for the Cupertino company. The decision also condemned Apple to allow application developers to include buttons redirecting the user to an external payment environment, but the company appealed before it was forced to adhere to the measure, and the court’s decision regarding this specific issue has been suspended pending further trial.

Musk has also commented on Apple’s financial requirements, which withdraw up to 30% of the amounts carried by the applications sold in the store. “Did you know that Apple puts a secret 30% tax on everything you buy from the App Store?” he protested.

“Apple charges this amount and does not offer alternatives. There is no way to advertise apps without paying the percentage”, explains Zingales. In fact, this was the main motivation for Epic Games to file its lawsuit.

When contacted by the report, Apple did not respond.


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