The New York post is reporting that the Department of Justice and Federal Trade Commission are in negotiations over which of them will begin an antitrust inquiry into Apple's new policy of requiring software developers who devise applications for their iDevices to use only Apple's programming tools.
The inquiry will focus on whether the policy, kills competition by forcing programmers to choose between developing apps that can run only on Apple devices, or come up with platform neutral apps.
Now, an inquiry doesn't necessarily mean any action will be taken, they‚Äôre literally just looking into it, as they would with any company. Regulatory agencies initiate inquiries to determine whether a full-fledged investigation needs to take place.
If the inquiry does escalate to an investigation, the agency handling the matter would issue Apple a subpoena seeking information about the policy.
Apple has argued that the new rule was created to ensure the quality of the apps it sells to customers.
Steve Jobs recently wrote a scathing treatise explaining why Adobe's Flash was unfit to be used on Apple products. The day his missive was released, Adobe shares fell 2 percent. Adobe themselves backed down from talk of a lawsuit.
Critics say Apple‚Äôs rule hampers competition since the expense involved in creating an app will lead developers with limited budgets to focus on one format, not two. App developers are paid from a cut of the revenue generated when consumers buy the app.
Shaun Meredith, a former Apple employee now running InfoBridge, says that as a result of Apple's rule change, some customers are choosing to finance apps that are compatible with all of Apple's competitors instead of those that work only with the iPhone or iPad. Because though Apple has the most applications, it is second in operating system market share. According to comScore, RIM‚Äôs BlackBerry has a 42 percent share, while Apple's take is 25 percent. Microsoft has 15 percent and Google's Android software has 9 percent.
If the point of the rule was indeed to drive business to Apple, as the criticism is want to suggest, then Meredith‚Äôs anecdotal account would seem to suggest that just the opposite is happening.
If you thought the Apple/Flash war was over, you we're wrong.