At the root of this claim is the belief that consumers have a right to an imaginary product they wished companies would build. Not surprisingly this imaginary product is viewed by the “monopolist”, whether rightly or wrongly, as the worst possible strategy, and an aid to its competitors. In this case it’s an iPhone that works with any carrier. In the 90s it was a Windows that ran without a web browser. Human rights are rights are about leaving your free to act, not a right to force someone else to build something you want. There’s a word for the latter: slavery.

Looking back 10 years, we can see the affect in the marketplace of the DOJ and FTC’s assault on Microsoft. After the famous Microsoft antitrust trial, the company shut down nearly all development on its web browser, because they saw it was pointless to innovate as the government would simply shut them down. For the next 5 years, there was incredibly little innovation in web browsers across the industry. Web developers today lament that Internet Explorer 6 is so primitive and yet installed on tens of millions of computers. But it was their insistence on antitrust enforcement that lead to the problem.

No one can reasonably say that Apple has a monopoly and is abusing it. The problem with Apple is that it is competing too well and its competition is too pathetic. This is all about politics, not business.

I am glad that you decided to write about this case, but I think you missed an important aspect that needs mentioning. Apple and AT&T made their agreement on the assurance that their legal rights would be protected: that any products and services they created would be owned by them and them alone. AT&T signed their agreement because the exclusive network provider access it received from Apple was worth what it had to offer to Apple. Apple signed the agreement and gave up the chance to sell its phones through many providers because of the value of what it was getting from AT&T. If Apple and AT&T had known that their agreement would be struck down by a court, there might well have never been an iPhone. If Apple had built the iPhone without a major network provider it likely would not have been as good because Apple could not have justified putting as much into its development–a project which was considered risky at the time because Microsoft Mobile Smartphones were expected to dominate the limited market for a combined phone and 3Com Palm Pilot.

The companies that make unlocked phones expect the same protection of their rights when they bring their phones to market. If a court struck down their ownership of the phones they created and let anyone manufacture and sell their designs, the companies never would never have built the phones in the first place. So why are the rights of some companies that make unlocked or locked phones protected but the rights of two companies that make a locked phone not protected? Because rights are not seen today as principals that apply to every person and company and because of envy of the success of Apple and AT&T. If AT&T and Apple made phones as popular as the Microsoft Mobile Smartphones that are offered exclusively through AT&T, there would be no lawsuit. No one cares about a phone that sells a few thousand copies a year: they are not big enough to hate. What they need to get a lawsuit started is a couple of companies that are so successful they know the companies are doing something illegal because–in their view–no one can be that good and at the same time be moral.

Regards,
Daniel

Here is an example of a Windows Mobile Smartphone from HTC Mobile and AT&T: http://www.htc.com/us/products/pure-att