In today’s antitrust hearing in the U.S. Senate, Apple and Google representatives were questioned on whether they have a “strict firewall” or other internal policies in place that prevent them from leveraging the data from third-party businesses operating on their app stores to inform the development of their own competitive products. Apple, in particular, was called out for the practice of copying other apps by Senator Richard Blumenthal (D-CT), who said the practice had become so common that it earned a nickname with Apple’s developer community: “sherlocking.”
Sherlock, which has its own Wikipedia entry under software, comes from Apple’s search tool in the early 2000s called Sherlock. A third-party developer, Karelia Software, created an alternative tool called Watson. Following the success of Karelia’s product, Apple added Watson’s same functionality into its own search tool, and Watson was effectively put out of business. The nickname “Sherlock” later became shorthand for any time Apple copies an idea from a third-party developer that threatens to or even destroys their business.
Over the years, developers claimed Apple has “sherlocked” a number of apps, including Konfabulator (desktop widgets), iPodderX (podcast manager), Sandvox (app for building websites) and Growl (a notification system for Mac OS X) and, in more recent years, F.lux (blue light reduction tool for screens) Duet and Luna (apps that makes iPad a secondary display), as well as various screen-time-management tools. Now Tile claims Apple has also unfairly entered its market with AirTag.
During his questioning, Blumenthal asked Apple and Google’s representatives at the hearing — Kyle Andeer, Apple’s chief compliance officer and Wilson White, Google’s senior director of Public Policy & Government Relations, respectively — if they employed any sort of “firewall” in between their app stores and their business strategy.
Senate antitrust hearing on app stores gives Apple critics a big soapbox
Andeer somewhat dodged the question, saying, “Senator, if I understand the question correctly, we have separate teams that manage the App Store and that are engaged in product development strategy here at Apple.”
Blumenthal then clarified what he meant by “firewall.” He explained that it doesn’t mean whether or not there are separate teams in place, but whether there’s an internal prohibition on sharing data between the App Store and the people who run Apple’s other businesses.
Andeer then answered, “Senator, we have controls in place.”
He went on to note that over the past 12 years, Apple has only introduced “a handful of applications and services,” and in every instance, there are “dozens of alternatives” on the App Store. And, sometimes, the alternatives are more popular than Apple’s own product, he noted.
“We don’t copy. We don’t kill. What we do is offer up a new choice and a new innovation,” Andeer stated.
His argument may hold true when there are strong rivalries, like Spotify versus Apple Music, or Netflix versus Apple TV+, or Kindle versus Apple Books. But it’s harder to stretch it to areas where Apple makes smaller enhancements — like when Apple introduced Sidecar, a feature that allowed users to make their iPad a secondary display. Sidecar ended the need for a third-party app, after apps like Duet and Luna first proved the market.
Another example was when Apple built screen-time controls into its iOS software, but didn’t provide the makers of third-party screen-time apps with an API so consumers could use their preferred apps to configure Apple’s Screen Time settings via the third-party’s specialized interface or take advantage of other unique features.
Blumenthal said he interpreted Andeer’s response as to whether Apple has a “data firewall” as a “no.”
Posed the same question, Google’s representative, White, said his understanding was that Google had “data access controls in place that govern how data from our third-party services are used.”
Where is the e-commerce app ecosystem headed in 2021?
Blumenthal pressed him to clarify if this was a “firewall,” meaning, he clarified again, “do you have a prohibition against access?”
“We have a prohibition against using our third-party services to compete directly with our first-party services,” White said, adding that Google has “internal policies that govern that.”
The senator said he would follow up on this matter with written questions, as his time expired.