Apple’s 3.3.1 problem

Apple locks horns with developers…again.  This time over a section in new agreement for the 4.0 SDK requiring ‘pure’ Apple code without the use of third party platforms.  I remember they prevented people from developing such frameworks in the first place (otherwise an app could get into app store and then sell plugin apps to others).  The new infamous section 3.3.1 goes one step further…

3.3.1 — Applications may only use Documented APIs in the manner prescribed by Apple and must not use or call any private APIs. Applications must be originally written in Objective-C, C, C++, or JavaScript as executed by the iPhone OS WebKit engine, and only code written in C, C++, and Objective-C may compile and directly link against the Documented APIs (e.g., Applications that link to Documented APIs through an intermediary translation or compatibility layer or tool are prohibited).

Uproar and numerous comments for both sides are here: A brief assessment of Jobs’s iPhone OS defense.

I have admiration for the boldness of the strategy as well as excellent timing for each of the moves.  In the long run, I have doubts about this strategy sustaining itself – but that could be a long time for Apple to make its billions.  As Keynes once said – in the long run we are all dead.  The bet Jobs is making is that a vertical integration model of controlling soup to nuts is going to result in better products and customers will pay a premium for the ‘it just works’ brand.  Especially in fast evolving markets, such as early days of personal computers (before they became PCs) and early days of smart phones and ubiquitous computers.  This market, like others will saturate (around 2015?) and the market will move towards consolidations and common standards.  Apple here wants to be the next Microsoft, or at least prevent spawning another Microsoft to kill its products.

There is no such thing as half-pregnant.  Apple is demonstrating that it not only believes in the vertical integration model, but is willing to run over few fans (and Adobe) to achieve it.  Several blogs have covered all aspects of why this is a good move and why it isn’t.  But the big picture remains, when the next big thing from Apple stops becoming a craze, Apple will fall into the classic trap of managing cash cows and trying to invent the next big thing.  The cash cow people and new thingy people will start bickering and open the doors for cheaper competitors ready to move upmarket.

What is flip-side of this strategy that can wreck havoc for Apple?  It is always the unexpected third front while all the energy is focused on its immediate threats – Adobe and Google.  Someone will crack the magic of cool hardware, open software platform, robust tools and trusted ecosystem.  Will it be Android?  Microsoft’s Mobile 10? Nokia?  Palm?  My money is on the ones with most money to spare – GOOG and MSFT, since this is not a sprint.