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AN APPLE A DOJ KEEPS INVESTORS AWAY ANALYSIS

As an Apple shareholder, I have wanted to do this type of post for a long time. The U.S. Department of Justice, Apple competitors and other international agencies have all beat the drum of anti-trust, anti-competitive business behavior by tech company giants. But the whole foundation for much of their claims is that big tech is big for a reason: loyal consumers like their products and services. Apple isn't the only big tech company facing government scrutiny. The DOJ has led an antitrust cases against Google in 2020 over its dominant search position and another one over its advertising business. The DOJ also famously sued Microsoft in the 1990s, eventually forcing it to allow users to unbundle the Internet Explorer browser from the Windows operating system.

The worst charge against Apple is that it has a monopoly on the iPhone market. Of course it does! It owns the patents and trademarks on the iPhone technology. And patents give the owner a monopoly over its use, distribution and sale. This is the tip of the iceberg of the nonsense illogic that is the heart of many of this lawsuits.

As CNBC recently reported The Department of Justice sued Apple saying its iPhone ecosystem is a monopoly that drove its “astronomical valuation” at the expense of consumers, developers and rival phone makers. The lawsuit claims that Apple's anti-competitive practices extend beyond the iPhone and Apple Watch businesses, citing Apple's advertising, browser, FaceTime and news offerings. “Each step in Apple's course of conduct built and reinforced the moat around its smartphone monopoly,” says the complaint. The Justice Department said in a release that to keep consumers buying iPhones, Apple moved to block cross-platform messaging apps, limited third-party wallet and smartwatch compatibility and disrupted non- App Store programs and cloud-streaming services. The challenge represents a significant risk to Apple's walled-garden business model. The company says that complying with regulations costs the company money, could prevent it from introducing new products or services, and could hurt customer demand.

“Competition on the merits is good for everybody,” Jonathan Kanter, assistant attorney general for antitrust, said on CNBC's Squawk Box. “Good for business. Good for consumers. It's good for the economy, and so ultimately this is what this lawsuit is about,” Kanter added. In a rebuttal statement Apple said the suit "threatens who we are” and would “set a dangerous precedent.” Experts told CNBC that the suit could take years of litigation and that Apple is likely to seek its dismissal. But in the interim, those experts said, the larger risk to Apple and its shareholders was the distraction and scope of an antitrust lawsuit, which could potentially divert executive focus away from the business.

But the DOJ charges are absurd if one with any common sense on how business operates and real marketplaces are run.

Apple has an iPhone monopoly because it owns the iPhone technology. It does not license it to anyone else. It does not have to license it. There is nothing illegal about owning patents for a specific smartphone technology.

Apple is not a smart phone monopoly. In the US, Apple has 57.9 percent of the market and Android OS has 41.6 percent share. Globally, Android users are 70.3 percent while Apple is only 29 percent. Samsung has 27 percent share of US market and 23 percent of global market sales. But Samsung is not complaining about Apple business practices.

What the DOJ and state attorney generals do not understand is that Android OS phone makers have their own marketplace to sell their products. Apple does not have to open its technology or its store to its rivals. There is Supreme Court precedent for this fact.

It is like saying a major department store like Target, who has professional buyers to seek out and buy inventory for store shelves, has to allow ANY vendor sell their products on Target shelves without paying Target for the sales. Or, having a consumer going to their Chevrolet dealer to have their Blazer serviced but demanding the Chevy mechanics only use Ford Bronco replacement parts. It is a ridiculous argument that Target or Chevrolet dealer is anti-competitive in this situation.

Apple has devised a proprietary system that integrates all the features to work seamlessly between devices and internet services like the cloud. Consumers have rewarded the innovation and product performance by paying premium prices for it. Why? Because it works better than the competition. Just because people like your products more than others does not make the result an antitrust violation.

Certain vendors, like Epic, complain about Apple's App Store charges them 30 percent of the gross sales price as it goes through the Apple payment system. But charging a surcharge is what every brick and mortar retailer does in order to turn a profit. A virtual store is no different. But vendors do not have to use the App Store. But by signing an Apple developer license, vendors have access to all the iOS tools and safeguards of Apple vetting their programs prior to sale. Again, regular stores have the same gatekeeping rights. You cannot walk into your local grocery store and set up your own fruit stand and keep all the money for yourself. The 30 percent sales charge for Apple is to pay for engineers, technicians, network administration, server costs, etc. to run the App Store so that end consumers get the best Apple experience.

Some vendors claim that Apple also charges for in-app purchases. Well, Apple is providing the vendor a service to reach its Apple customers. It is like a restaurant that will have a no free refill cola policy. You have to pay for each drink you want to have in the restaurant. A bar may have a cover charge to get in, but the beer company does not get to keep all the money for each beer sale. In Epic's suit against Apple, the court did give Epic a small victory, to allow it to link to outside website for sales. But it is an impractical solution since consumers already in any store will buy the product there instead of being told to go to a different store. A grocery store may sell Crispy Creme donuts. The sales sign can say YOU CAN ALSO BUY THESE AT THE CRISPY CREME STORE LOCATED AT XXX. Fine. The consumer has the option to go to the other location. But it is more likely he will buy it at the grocery store. And that is why Crispy Creme is in the grocery store in the first place - - - convenience and more sales.

The DOJ is upset that the iPhone OS is not compatible with other smartphone makers when it comes to messaging and file sharing. But they are different operating systems! As such, there is built in functional incompatibility. That is not an antitrust violation. It is two different ways of creating products. It is the actual differences that gives consumers choice on features, options, functionality and cost. If I want to hear an old cassette music tape, of course I cannot jam it into my CD player thinking that it is going to work.

The DOJ claims that Apple's iPhone and App Store has the power to control prices and exclude competition. But any retailer has a right to exclude certain makers from their shelf space. But Apple does not control the prices of apps sold in its store. The software developer sets the price, including offering it for FREE, and Apple only takes a percentage of that price. This is the opposite of sellers demanding retailers only sell at manufacturer's suggested retail prices. The purpose of that clause was stop competing seller's from discounting the manufacturer's goods (even though the wholesale price was already paid.) But such clause is unenforceable; the retailer is free to set the goods sale price, even to the point of losing money on an item (a loss leader) in order to drive shoppers into their store to buy other things.

The DOJ also claims Apple retaliates against Vendors who do not comply with its developer terms and store conditions. But that is normal operating procedure in any retail business. When a national hardware chain sells a tool brand, it first tests the quality of the product before ordering it. The reason is simple: the hardware store does not want its reputation hurt by selling inferior products. Consumers have more confidence in their purchases if the retailer has pre-screened the products it sells. Vendors on the App Store need to be screened by Apple to see if it meets their guidelines and quality standards before it is put on the App Store. If a vendor does not comply with those requirements, the software is not sold on the App Store. That is not retaliation, it is smart business practices.

But I am not alone in my criticism of this antitrust case. Reason Magazine and the Cato Institute agree.

Reason Magazine said “It's an absolutely bonkers lawsuit, based on weird ideas about business and even weirder ideas about government. The latest in a long series of antitrust suits filed against tech companies, the Apple lawsuit shows just how eager the Biden administration is to bring business decisions under federal control. The case illustrates a shift among enforcers towards a 'big is bad mentality“ quoting said Jennifer Huddleston, who works on technology policy for the libertarian Cato Institute.

What is the real end game here? The European Union has been fining Big Tech companies hundreds of millions of dollars. Perhaps, this government revenue model is being imported to the US. But more fundamentally, this may be all about control. The federal government wants to run everything in your life. Do you think the Biden administration or a staff of DOJ lawyers could run Apple better than Tim Cook?

The lawsuit did shave a huge amount of equity value for Apple shareholders, as the stock price was down 4 percent on the day the lawsuit was filed. It will be a costly legal battle but the consensus is that Apple should prevail if capitalism is to prevail.

We really do not think this lawsuit is about protecting consumers. or that consumers are being deceptively price gouged by Apple. And nothing involved in this suit is claiming Apple is forcing Android OS makers like Samsung to abandon their tech to adopt Apple technology. No, the driving force is upset developers who are not making enough money off their applications. There are hundreds of applications competing in the same space on the app store. It is that internal app market that sets the price people will pay for a game, a spreadsheet, or paint program, not Apple. It is that disconnect that is at the heart of the matter. An app developer is not really competing with Apple for market space, they are competing against other app developers in the shared retail space. And some developers are better than others at making products that sell well to consumers.

cyberbarf

SCAM PLAYBOOK: ARTIST NEWS

Most artists are freelancers looking for the next gig. Large media companies cut staff artists a long time ago. Social media has created an overcrowded ocean of artists showing their work in order to get recognized, admired and maybe hired by a reputable company. But this gives scammers a window of opportunity.

This is the basis for the Artist Scam, most commonly occurring on Instagram. The artist or their employer will reach out to you through your direct messages, telling you how much they like a photograph or painting you have posted to your account and would love to use it for an art project they are working on.

Or it may be an out-of-left field message that someone wants to buy your work or sell it as an NFT. NFT art is a digital asset that the buyer owns and can sell or trade on a blockchain platform. The sale of NFTs is a means of selling digital art without building an extensive social network. Blockchain transactions take place on NFT marketplaces, claiming to reduce the obstacles of self-promotion.

But both of this situations may sound good on the surface but it is just a means to access your personal account.

It also can be an email solicitation for a commissioned art work. Cartoonists get these all the time. The request comes with a large proposed fee but with few actual specifics. Usually, a publication will solicit drafts or a portfolio based on the concept they are looking for before deciding on compensation and contract terms. Having a person start at the end of the normal process is a red flag.

It is always good to check within your own art community if this emailer is legit. It is also good to push back and ask for a contract or send a proposal through the artist's regular web site. Nine times out of ten, the emailer will vanish since the whole scheme is to send you too much money then ask for the overage back immediately before their original check bounces.

How can you tell a scammer on Instagram? Their account can contain many clues:

1. Zero or very few posts. This shows more of a shell account than a real one.

2. Irrelevant posts and comments. If the party is an employee of a large magazine or gallery, he or she would be promoting her employer and their projects on the account.

3. Incomplete profile information. No basic information about their name, city, state or occupation. Or the information may be contradictory such as a Swedish surname with a Chinese ISP address.

4. Poor follower-following ratio. Even if the account is new, a large amount of follows shows that the person is fishing for a mark. The followers may be other scammers or other accounts but scammers do not have the time or effort to maintain multiple hooks in the Internet waters.

5. Absurd user name Most professional accounts use real names that can be verified or real company brands.

6. Private account. A private account shuts down public comments which could alert you to prior victims of their scams.

7. Generic or stock photos used as profile pictures. Again, the scammer is not wasting time by sharing their life pictures that could be used to identify them in the future.

8. Promotional DMs and posts. A scammer may promote a show or an event or an aggregation of artists into a community, but if it is real it can be verified through a web search to get brick and mortar confirmation before falling into a trap.

To be safe, one needs to verify an offer before trusting its source.

cyberbarf

THE MEDIA MADE THE MONSTER CULT OF POLITICS

When Donald Trump lost his re-election bid to Joe Biden, we said JUST IGNORE HIM AND HE WILL GO AWAY!!! But no body listened to us or common sense. Trump, a megalomaniac narcissist addicted to attention, made himself a martyr to self-indulgence stupidity, to claim his reelection was stolen by boogie men, ghosts and non existent facts to keep the cable news talkers in a consistent state of hatred frenzy. Politics has corrupted all public institutions. Trump has been the final nail in the democratic coffin. Democratic prosecutors in New York stretched local laws to warp unprosecuted federal crimes to hit Trump where it hurts: his wealth. Unbiased legal experts believe that the current judgments are excessive and can be reversed on appeal.

Such action would not vindicate Trump. Trump is a contemptible bully. He has no idea about the constitution, principles, the rule of law or how elections work. He is the smartest man in the room in his mind because for decades he surrounded himself with YES men and crazy political hacks. His first big national introduction to his gruff persona was a bad reality television show, the junk food of American storytelling. His hostile takeover of the Republican Party spelled doom to moderate legislators and compromise statesmanship. He became a cult figure for the lunatic fringe conspiracy loons. He admires world dictators because they are feared by their rivals. His sole platform is to insult anyone who utters a single negative word about him. He is a rabid pit bull with no empathy, compassion or soul. If the media turned off the spotlight, this attention addict would have slithered away into his swampy businesses. If old guard Republicans had any balls, they would have run him out of the party. But everyone is afraid of him instead of pushing back. Sleazy politics has gotten so bad normal people refuse to run for office and competent people leave office because partisanship is a cancer with no cure.

It is so bad that Trump ran basically unopposed. His snake oil salesmanship to his mob rule base is a classic case of cult of personality. He is a caveman grunting through the 21st Century. Faced with mounting debts, he has gone to the crazy low of selling tennis shoes and bibles to his followers. He manipulated his new, basically worthless social media company to merge with a paper company to get listed on the stock exchange, putting his shares worth billions. How is that possible in a world of laws and moral values? Because the media feeds his frenzy for power and power corrupts absolutely.

In his designer tennis shoes, Trump could only run the 40 yard dash in minutes instead of seconds. In his Trump bible, he probably only has the dirty parts book marked. Money is his morality. Fame is his drug. Attention is his high. His arrogance, mindless drivel and shouting in lieu of intelligence is his trademark.

At some point, even a toxic public relationship with the voters has to sour. Primary turnouts have been low because finally the silent majority of moderate voters have determined their is no real good choice in this year's election. After he lost in 2020, national media should have stopped covering his tirades about the election since it was not about the election but himself. The media kept covering Trump in order to punish him instead of reporting journalism on the real issues plaguing the world. It is easy and cheap to have panel after panel of talking heads spew vile and accusations against each other. Marginal time fillers, terrible democracy footnotes.

iToons

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FOUND BUT NOT LOST ON THE INTERNET

Putting padlocks on public places have been around for a while in Seoul, South Korea. The tradition is to put a message and lovers names/initials and throw away the key. It is a symbol of everlasting love. This photograph comes from Paris, France, the self-proclaimed City for Lovers. Is this lock tradition spreading around the globe?

Source: Stuart Teischer

It is a great honor to be invited to Cannes. The festival has a short film series competition that highlights television dramas. The unreleased South Korean TV series TAROT was chosen as one of seven works to compete at this month's competition. This series has self-contained mystery stories. The one chosen by Cannes features excellent actress Jo Yeo Jeong in the lead. But news of the event on several entertainment sites had the above disclaimer. Journalism, even on entertainment web sites, still has to meet the minimum standard of accuracy and truthfulness. But the use of AI to write a current event news article is terrible news.

Source: kpopreporter.com

Hacking and ransomware attacks are on the rise. Public companies are required to disclose data breaches but every industry is a potential target. Even small businesses on a daily basis get one or two phishing or suspect emails. Personal information is still the high target prey for the black market. But near the top of the list are law firms that have confidential information on mergers/acquisitions, public figures' private information and large escrow accounts.

Source: Lenne CLE

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THE WHETHER REPORT

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STATUS

Question: Whether a boring election is bad for democracy?

* Educated Guess

* Possible

* Probable

* Beyond a Reasonable Doubt

* Doubtful

* Vapor Dream

Question: Whether the market collapse of EV bubble will get governments to change policies on petro powered vehicles?

* Educated Guess

* Possible

* Probable

* Beyond a Reasonable Doubt

* Doubtful

* Vapor Dream

Question: Whether world governments' lawsuits against Big Tech companies is merely an attack to get money to off-set massive debt burdens?

* Educated Guess

* Possible

* Probable

* Beyond a Reasonable Doubt

* Doubtful

* Vapor Dream

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