October 6, 2022

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At the center of many debates about digital life is one question: Should we value what happens on the Internet higher than the old habits of the analog world?

That’s a link between complaints about selling products on Amazon, selling apps in app stores for smartphones, trying to make a living on YouTube, or renting houses on Airbnb. In all of these cases, people and companies complain about the costs, rules, and uncertainties of activities that used to be more burdensome, if they were at all possible.

Some of these complaints are out of place, and some reflect a fundamental fear of living online. The internet promised to reverse the old ways and it undermined the power of the old doormen, like Hollywood bosses or big stores, who said yes or no to people trying to do what they love. But they are being replaced by new and equally powerful digital gatekeepers like Google and Apple who can determine who wins or loses.

I pondered this topic because of a recent email from an on tech reader named Susan, from Tucson, about the app makers saying Apple is imposing unfair costs and complexities on them and iPhone users:

For many, many years, artisans have shared the profits with the shop that sells their handcrafted items on commission. When I started in the 70s, it was 60 percent for me and 40 percent for the shopkeeper. Later the commission was sometimes 50/50.

For this reason, I am irritated by the problem that the App Store receives a commission for the apps from programmers. What is the difference between the App Store and the shop owner? Both are responsible for providing an exhibition space to ensure quality for the buyer.

Susan doesn’t invalidate the app makers’ complaints, but she does provide helpful context: This is how it has always been done, and often for good reasons.

Stores have long determined what products appear on their shelves and how aggressively they are advertised to potential buyers. Apple makes the virtual equivalent of this for apps. And, as Susan (and Apple) point out, conventional stores tend to withhold a much larger portion of the selling price of a product than Apple’s commission of up to 30 percent on some app transactions like streaming video subscriptions.

It’s understandable to compare the old world with the digital and think: this new path isn’t that surprising, is it? It’s a great point that I hear a lot from readers, and not just about Apple.

I’ve also heard from people who have asked whether it is fair for some members of Congress to try to change the law to prevent Amazon from making its own brands of coffee and sundresses that are competing with retailers in Amazon’s digital mall . After all, conventional retailers have always been doing the same thing with their in-store versions of Tylenol and Cheerios. Why do people who make videos on YouTube or TikTok complain about the breakneck pace and unpredictable paychecks when making a living from entertainment has always been a pain?

These are fair points. But I also think these complaints reflect a discrepancy between expectations and reality about the internet. Anyone can now create and publish anything online, but it can be incredibly difficult to get noticed. Enter the new gatekeepers who can be just as powerful and capricious as the old ones.

Those who make cat toys no longer have to persuade a business to sell their products. She can set up her own website or sell on Amazon. But maybe she still has to spend a fortune advertising on Google or Amazon just to get noticed.

Likewise, a talented performer can make YouTube videos and skip trying to navigate the Hollywood studio system. But he’s exposed to the whims of Google’s algorithms to be seen and ultimately paid for. A person with a great idea for a video game can create an app instead of convincing a large company to make the game, but they rely almost entirely on the dictation of app store owners like Google and Apple. (Dozens of attorneys general sued Google Wednesday over allegations the company was abusing its dictatorial app power.)

It’s still a miracle that you can reach billions of potential fans with just a few clicks. The old ways were arduous and difficult, but the frustrations with the new ways are real.

  • It’s completely Mark Zuckerberg’s Facebook: In an excerpt from my colleagues’ new book about the company, Sheera Frenkel and Cecilia Kang describe how Facebook’s crises over the past five years have meant that Sheryl Sandberg, the company’s deputy chief executive officer, has less influence.

  • I need a database to keep track of all technical claims: Dozens of attorneys-general sued Google, the fourth antitrust lawsuit filed against the company by federal or state officials in the United States since October. This accuses Google of abusing its power over Android phones and of imposing unfair conditions on the app manufacturers. The lawsuit is also putting pressure on Apple, which operates its iPhone App Store in a similar manner, report David McCabe and Dai Wakabayashi.

  • GIANT KITTY: A three-dimensional digital image of a “cat the size of a yacht” attracts crowds and fans in Tokyo, write my colleagues Hikari Hida and Mike Ives. The digital billboard calico pops open briefly to greet people and dozes a lot, just like real cats.

Baby Manatees !!!

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