Roundtable: Is Apple Playing Dirty With Google?

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On last week's Motley Fool Money Radio Show, we talked about Apple's (Nasdaq: AAPL) decision to modify its developer agreements for the iPhone, iPod touch, and iPad. The move effectively bans developers from using Google's (Nasdaq: AAPL  ) AdMob advertising network, and AdMob's CEO cried foul over the move. Our team of analysts weighed in on Apple's latest offensive:

Seth Jayson: I think Steve Jobs might need to get ready for a close-up with the Feds. I don't normally love to defend Google, but I think Google had a fair point. Apparently, the developer agreement with iAd and the iPhone applications would exclude developers from working with a Google or another market force -- another force in the cell phone operating hardware or software system. It relegates developers to either choose between Apple's advertising platforms or some small third party. And of course, nobody is going to work with a small third party, because you have less chance of making money that way. It's a little anti-competitive. If you're an Apple shareholder and it works out, that's going to be great. I don't know if the Feds will let that go on forever.

Shannon Zimmerman: Meet the new boss, same as the old boss. Microsoft (Nasdaq: MSFT  ) used to face all of these challenges as well. Now its Apple's turn.

James Early: You can only play the game as long as we win.

Shannon Zimmerman: But Apple is playing it well. This is sort of antitrust bait, but they're pushing it as far as they can because they're the dominant force. They are writing the rules and they're enforcing the rules, and at some point, somebody is going to blow the whistle.

Seth Jayson: And their market share isn't so much yet that people have to be very worried. But the more successful they are, the more they are going to have to watch out.

You can hear more from the guys on The Motley Fool Money Radio Show. New shows get uploaded every Friday at 6pm.

Seth Jayson, James Early, Shannon Zimmerman, and Chris Hill may own stocks discussed during the course of the weekly radio show. To see the stocks they own, view their profile pages, linked here: Seth, James, Shannon, and Chris.

Microsoft is a Motley Fool Inside Value selection. Google is a Motley Fool Rule Breakers pick. Apple is a Motley Fool Stock Advisor recommendations. Motley Fool Options has recommended a diagonal call position on Microsoft. Try any of our Foolish newsletter services free for 30 days. The Motley Fool has a disclosure policy.

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  • Report this Comment On June 15, 2010, at 3:08 PM, marv08 wrote:

    Maybe that explains why roundtables got a bit out of fashion since old Arthur called it quits...

    1. There is a huge difference between disallowing a direct competitor to freely obtain device and user data from your devices (including prototypes) and "effectively banning developers from using Google's AdMob advertising network". AdMob has not been banned – they can't analyze device and user data, that's all.

    2. Apple is a "dominant force" in online advertising? Last time I looked at it, their share was exactly 0%. Quattro Wireless was a very distant second in mobile advertising (which is a small fraction of online ads) and the vast majority of online ad revenue still goes to Google... How is Apple dominant here?

    Apple does not want competitors to analyze its users and devices - both is 100% understandable and legitimate. Apple does not create ad software for other platforms in order to steal device and user data from competitors. Google bought AdMob without being forced, they bought Android without being forced. They have created a conflict of interest without being forced. They create free services and software with money made from nothing else but ads... Do you speak up for those they have and will put out of business?

    And the "roundtable" concludes it is Apple that has to clean up that mess? How?

  • Report this Comment On June 15, 2010, at 3:10 PM, BabyGoat wrote:

    Lets turn the title around. Was Google playing dirty with Apple?

    When Google´s CEO Eric Schmidt was in Apple´s board, his company was already planning to compete with Apple giving smartphone OSs away. My take is that it was a conflict of interest and Apple should have known from the start. I don´t know if Schmidt could be taken to court for that, but it could be something Apple lawyers should look into.

    If it was my call, I would try to keep Google off advertising in iOS apps too.

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