Federal investigators are looking into the way Apple banned iPhone and iPad applications from integrating with the Google AdMob service. Hours after Google released its AdMob software development kit (SDK) to developers ahead of Apple’s own iAd initiative, the rules for Apple iPad and iPhone developers changed: no apps are allowed to work with Google AdMob or run on multiple operating systems.
In response to complaints concerning the tactics Apple is using to restrict competition, the Federal Trade Commission (FTC) has opened a formal probe to determine whether Apple policies leveraging its market position to unfairly hurt competitors are legal. The investigation is said to center around tactics used by Apple to restrict rivals in mobile advertising, mainly Google AdMob, but will also include a look at Apple policies concerning Adobe Flash.
Apple Moves against Google, Adobe
Apple faces intense questioning concerning its business practices that seem hostile to companies like Google and Adobe that Apple perceives as threats. Last month Apple effectively banned all development of iPhone and iPad apps that use Adobe Flash, a move that followed weeks of public bickering between the two firms.
When Google humiliated Apple by being the first to release a mobile advertising (SDK) for Apple iPad and iPhone applications, Apple responded by banning AdMob from its devices.
In the same action, Apple also banned applications that could run on multiple operating systems such as Google Android. In yet another move, Apple has banned the use of third party tools in the development of applications for the Apple iPhone and iPad platforms.
Apple iOS 4
Mobile advertising took a leap forward this week with the launch of Apple iOS 4, the first advertising enabled operating system for Apple iPhone and iPad. Designed to serve ads from within iPhone and iPad apps, the feature earns revenue for developers and Apple alike.
Earlier this year Apple CEO Steve Jobs estimated that over a billion advertisements could display on Apple mobile devices every day. It is the Apple move against AdMob that prompted federal regulators to proceed with an investigation of Apple practices and their effect on the mobile advertising market.
Fresh off a decision that allowed Google to purchase AdMob, the FTC is familiar with the dynamics involved in the mobile advertising market and is expected to move quickly in its anti-trust investigation
HTC Suit Versus Apple Moves Forward
In a separate action, the International Trade Commission (ITC) allowed a patent infringement suit filed against Apple by smartphone developer HTC to move forward. The HTC action seeks to halt all sales of the Apple iPhone within the United States.
Sources:
Catan, Thomas. “Apple’s Mobile Rules To Get FTC Scrutiny .” Wall Street Journal. June 11, 2010. online.wsj # 72.html (accessed June 11, 2010).
Ogg, Erica. “Report: FTC will investigate Apple.” CNet. June 11, 2010. news.cnet_ # html?>
Womack, Brian, and Jeff Bliss. “FTC Said to Prepare Review of Apple Tactics in Mobile Ad Market.” Bloomberg. June 11, 2010. bloomberg (accessed June 11, 2010).