Writing in the Washington Post, Adam Lashinsky eviscerates the DOJ’s antitrust suit against Apple. Two slices:
To this day, it is easy to buy a book from Amazon on any device and then seamlessly switch among iPhones, Kindles, PCs or whatever device you prefer, reading the same book. If Apple tried to “force” users onto its platform, as the document lamely suggests, it failed to keep them there.
The complaint is full of such rhetorical oddities and other flimsy legal arguments. It references Apple’s “astronomical valuation,” which, while accurate — Apple’s market value exceeds $2.5 trillion — lacks precision, particularly of the legal sort. If Apple’s market capitalization were merely “planetary,” would Justice deem the company less of a monopolist?
Or take the infamous “green bubble” debate, the exclusion of non-iPhone users from coveted blue-bubble message threads. The complaint references the “social stigma” Android users experience, which might be real but is hardly grounds for an antitrust case. Besides, Apple already has capitulated on this, so it isn’t clear what remedy is needed now. Also, services such as WhatsApp, Signal and Discord work just fine on the iPhone. Use those instead.
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The complaint also editorializes on Apple’s fledgling entertainment business, nothing that the company “is rapidly expanding its role as a TV and movie producer and has exercised that role to control content.” Yes, Apple has spent money on successful and acclaimed programs such as “Ted Lasso,” “The Morning Show” and “Shrinking.” But it’s nowhere near the biggest Hollywood studio or streaming platform, which, by their very definition, do everything they can to control the content they produce.
Finally, the government let its ideology show. “It is not surprising,” it wrote, that in 2023 “Apple spent more than twice as much on stock buybacks and dividends as it did on research and development.” The complaint helpfully supplies the data: $77 billion on buybacks, $30 billion on research and development. Yet it said nothing about why that’s illegal, because it isn’t, or that Apple is the fourth-largest U.S. spender on R&D investments, after Amazon, Alphabet and Meta.
Also writing wisely about the DOJ’s unjustified persecution of Apple is my Mercatus Center colleague Alden Abbott. Two slices:
The lawsuit, which could drag on for years, has a low probability of success. At the heart of the plaintiffs’ case is that “Apple has consolidated its monopoly power not by making its own products better—but by making other products worse,” said Attorney General Merrick B. Garland in a statement yesterday. What the case overlooks, however, is that Apple consumers choose to pay a premium for iPhones because they find them to be superior products.
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The U.S. Supreme Court has long held that the Sherman Act’s touchstone is promoting consumer welfare. Apple could easily argue that its actions benefit Apple consumers. That they’re willing to pay far more for iPhones than for Android phones indicates that they value them far more. Interfering with Apple’s practices that create this value would harm Apple consumers, make iPhones more like Android phones and degrade dynamic competition, Apple could maintain.
Ted Cruz and Phil Gramm rightly decry the Biden administration’s effort to put AI on a leash. Two slices:
The arrival of a new productive technology doesn’t guarantee prosperity. Prosperity requires a system, governed by the rule of law, in which economic actors can freely implement a productive idea and compete for customers and investors. The internet is the best recent example of this. The Clinton administration took a hands-off approach to regulating the early internet. In so doing it unleashed extraordinary economic growth and prosperity. The Biden administration, by contrast, is impeding innovation in artificial intelligence with aggressive regulation.
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What’s clear is that the Biden regulatory policy on AI has little to do with AI and everything to do with special-interest rent-seeking. The Biden AI regulatory demands and Mr. Schumer’s AI forum look more like a mafia shakedown than the prelude to legitimate legislation and regulatory policy for a powerful new technology.
Some established AI companies no doubt welcome the payment of such tribute as a way to keep out competition. But consumers, workers and investors would bear the cost along with thousands of smaller AI companies that would face unnecessary barriers to innovation.
Joakim Book finds timely insights in Edward Chancellor’s The Price of Time.
As Jacob Sullum explains, the growing burden of ‘entitlements’ cannot be wished away.
