Apple is building a moat

The era of Apple slowly opening up its platforms and devices without government intervention has ended.

Apple is building a moat
Credit: DALL-E 3 / Microsoft Designer

Apple has a well-earned reputation for locking down its devices and software platforms, sometimes for justifiable reasons, and sometimes purely to make Apple more money. Apple has made small steps to open up its devices over the past few years and playing nicer with the competition, but that trend has now sharply reversed. The bricks from the so-called "walled garden" are no longer being removed—instead, Apple is building a moat.

Apple's main product strategy in recent history has been to offer devices and software platforms that are functional and intuitive for the average customer, even at the expense of "power user" features, long-term backwards compatibility, or the desires of large business customers. That doesn't mean Apple doesn't cater towards professionals, or Apple products aren't for serious work. It just means that when given the choice of "this is useful but it might make our products have unexpected problems or reliability issues," Apple usually doesn't go for it. Mac computers are somewhat an exception here—macOS is the company's only software platform where you can install software out of Apple's direct control.

That strategy is in stark contrast to most of Apple's competition. Windows 11 can still run some applications from the mid-1990s, because some of Microsoft's customers are corporations that don't want to rewrite their software more than once a decade. Google's Android platform started out with remarkably few barriers in place, partially because of its Linux roots and partially as a response to the original iPhone (which didn't even have an App Store), but much of that behavior has been locked down in recent years. The Android team has been open about this in many "fireside chats" at Google I/O events over the years—some ideas and APIs that sounded great in 2010 ended up being significant headaches, and moving away from them is often a multi-year process.

Apple has made progress in opening up and allowing more user customization over the past few years. The iOS 14 update in 2020 allowed iPhones and iPads to change the default web browser and email client for the first time. Apple started switching its iPads to USB Type-C in 2018, allowing them to use the same chargers and data connections as most Android phones and tablets, and the iPhone 15 series in 2023 kicked off that transition on the company's phones. The Safari browser on iPhones and iPads now supports more PWA features and standard web notifications. The Shortcuts application on iPhone, iPad, and Mac is now a fantastic automation and workflow tool, almost comparable to Bash scripts or PowerShell scripting, especially when combined with Focus Modes.

I'm not giving Apple full credit here, because many of those changes happened because of government legislation, or at least the anticipation of some future action. The European Union now requires new smartphones and tablets to have USB Type-C ports, so unless Apple wanted to release more hardware variations of iPhones, that migration had to happen anyway. Still, it's a documented trend. Apple has even improved support for its services on competing platforms—Windows PCs now have shiny new Music, TV, and "Devices" apps instead of the ancient iTunes app.

That trend has now come to a screeching halt, to the detriment of Apple's customers, third-party developers, and perhaps even Apple as a company.

The malicious compliance

Apple and other big tech companies have been fighting against the European Union's Digital Markets Act, which was passed in 2022. The law aims to improve competition in "digital markets," which mostly translates to reducing anti-competitive bundling practices and vertical integration. For example, with Windows 11 in the European Union, you can now turn off Bing results in the Start menu search, and Microsoft Edge is no longer opened when clicking links in some areas of Windows instead of the default browser. You can even uninstall Microsoft Edge completely.

Apple announced its updates to iOS, Safari, and the App Store to comply with the Digital Markets Act back in January. iPhones will allow third-party app marketplaces, which can install and update their own applications outside of Apple's App Store, ending the company's 16-year monopoly over app distribution. There are new APIs to allow third-party web browsers and rendering engines, and Apple lowered its payment processing fees for apps in the EU. The iPhone is now a fundamentally different platform in Europe than in the rest of the world.

It was immediately clear that Apple was not happy about these changes. The initial press release is one of the funniest and most unprofessional corporate announcements I have ever read in my almost eight years as a tech journalist. This is the first paragraph of the press release:

Apple today announced changes to iOS, Safari, and the App Store impacting developers’ apps in the European Union (EU) to comply with the Digital Markets Act (DMA). The changes include more than 600 new APIs, expanded app analytics, functionality for alternative browser engines, and options for processing app payments and distributing iOS apps. Across every change, Apple is introducing new safeguards that reduce — but don’t eliminate — new risks the DMA poses to EU users. With these steps, Apple will continue to deliver the best, most secure experience possible for EU users.

Apple is trying its hardest here to frame the DMA as a dangerous piece of legislation and implying that there were no dangers to users before it was passed. In reality, Apple's review process for the App Store doesn't stop harmful or scam apps either.

The changes also include a new menu that appears when opening the Safari browser for the first time, which asks people if they want to download and use a different browser instead. I love Apple's statement here:

This change is a result of the DMA’s requirements, and means that EU users will be confronted with a list of default browsers before they have the opportunity to understand the options available to them.

Oh no, I'd hate to be confronted with a list of web browsers! That sounds awful.

The press release and most of Apple's communications about these changes are bordering on malicious compliance. There are still many issues with the new rules that haven't been addressed, like the inability for app or web developers outside of EU borders to test how their software behaves on EU devices. Most of these changes also only apply to iPhones and not iPads, adding to the confusion. Apple could solve these issues with a "pretend I'm in the EU" toggle somewhere, or by rolling out these changes globally, but Apple probably won't because it's not legally compelled to do that.

The most alarming change in the past few weeks was the discovery that web apps added to the home screen would stop working in the EU. That's bad for many reasons: it is core functionality dating back to the first iPhone in 2007, many companies and developers recommend web apps instead of native iPhone apps, and some web functionality in iPhone Safari (like push notifications) is only enabled when an app is on the home screen.

Apple initially said this in a developer Q&A about web apps on the home screen:

Addressing the complex security and privacy concerns associated with web apps using alternative browser engines would require building an entirely new integration architecture that does not currently exist in iOS and was not practical to undertake given the other demands of the DMA and the very low user adoption of Home Screen web apps. And so, to comply with the DMA's requirements, we had to remove the Home Screen web apps feature in the EU.

The move caused some outcry from users and web developers, and Apple finally confirmed that it will undo the change before the final release of iOS 17.4. Apple didn't give an exact reason for walking back the change, which seems to indicate there wasn't a great reason for removing it in the first place. Does Apple care about web apps so little that it was ready to rip them out from iOS just in case it violated the DMA, as yet another act of malicious compliance? The EU was looking into the removal before Apple reversed course.

End of an era

Apple's fight against the DMA, the lack of communication around how non-EU developers are supposed to adapt, and almost killing web apps on iPhone paint a bleak picture for Apple. The era of slowly opening up to user choice and compatibility with the competition has seemingly ended. Apple would rather maintain a completely different version of its operating systems for Europe and create more headaches for third-party developers than lose another inch of control.

This isn't all that surprising of an outcome—Apple didn't become the world's first trillion-dollar company without the 30% cut from App Store purchases and the license money from Lightning connector accessories. The DMA is a direct threat to its App Store revenue, even though Apple will still collect revenue from most purchases made through apps on iPhones, whether they came from the App Store or not.

Apple is currently under investigation for antitrust practices by the United States Department of Justice, which could lead to DMA-style action against the company in the US. The wall around Apple's devices and platforms probably won't be torn down without government action.