Bad Apple?

Gruber points to an argument made by Sean Devine regarding Apple’s strategy with the App Store. While I think the central point is on target, what stuck out to me was that Devine made the case by pointing to iPod/iTunes lock-in based on DRM:

The KEY to maximizing iPhone profit is to create very high switching costs for users, just as they did for the iPod via the iTunes Music Store.

To me, this is a weak leg to stand on. Apple, if we are to take them at their word, never wanted DRM for iTunes music. DRM is what creates lock-in for the iPod/iTMS ecosystem. So take away DRM and what you have left is the hardware with a bunch of tracks you can put on any device. In this scenario, Apple must compete on the strength of the platform (hardware and software) user experience. I think this has always been the main focus for Apple

I think Occam’s razor would lead us to a slightly different conclusion: creating the entire application platform for OS X Touch (SDK and App Store) was hard, and was accomplished in very little time. It may be too much to assume Apple is exercising such control over the marketplace and intentionally shaping the pricing structure and kind of apps being sold.

That said, I don’t doubt that since they are making a ton of money, and they have a runaway success, that they’ll deploy changes to the system very carefully. Why make a major change to the current structure when they’re seeing such incredible sales? At the same time, I think they want to improve the service and get it right, since they know as well as anyone that major shifts in the marketplace can occur very quickly.

Maximization? Absolutley. Lock-in? Not so much.