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Eakinomics: Every
Now and Then You Win One
A theme of the Biden era has been the government running roughshod over
citizens’ hopes, dreams, and preferences. Progressives dictate
lifestyles, cancel dissenters’ opinions, and stifle debate. The
government regulates without restraint, moves control to the public
sector, and defies the private sector to grow in an environment of
crippling red tape and bloated government. And the competition regulators
openly discard the objective of enhancing consumer welfare in favor of an
agenda of political payback and playing favorites.
But every now and then the good guys win one.
As AAF’s Jeff
Westling put it: “In April, the 9th Circuit Court of Appeals
decided that Apple’s iPhone and application store practices – which limit
users to applications offered through Apple’s App Store and charge a 30
percent commission on sales – didn’t
violate antitrust law, adhering largely to the
consumer-centric analysis of modern antitrust law. As the court
explained, Apple had important, pro-competitive reasons for its
practices, such as enhanced cybersecurity, and consumers had the choice
to use these products and services.”
That’s right, Apple can do the things that it does – pricing and
restricting access to its app store – because it does business the
old-fashioned way and gives the customer what they want.
Having said that, there is nothing to stop Congress from meddling anyway.
In particular, a bipartisan group of senators introduced the Open App
Markets Act (OAMA) in the last Congress. It would require
firms like Apple to allow access to mobile operating systems without
going through the operating system’s own application store. With the 9th
Circuit’s condoning of Apple’s conduct in the mobile application space, a
renewed push to regulate the market could arise. This kind of access to
the operating system opens up a host of cybersecurity concerns, but
Congress could simply choose to dismiss the procompetitive benefits of
closed systems and make the determination to move ahead.
In short, it’s a good day for those appreciative of the power of market
forces, but a host of threats remain.
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