Dishwashers have become iPhones

Apple is a true business innovator: For more than a decade, they have been steadily perfecting an obscure anticompetitive tactic, turning a petty grift invented by console games companies into a global, cross-industry mechanism for extracting rents and centralizing control.

I’m speaking of App Stores, of course, and not just any app store, but one that’s illegal to compete with or switch away from. This started with console companies, who used technical tricks to ensure that they could skim a rake from every program you bought for your system.

Consoles used proprietary hardware or media formats to ensure that software vendors couldn’t sell directly to you, that every sale would be forced through their storefronts or licensing systems.

These tactics acquired the force of law in 1998 after Bill Clinton signed the Digital Millennium Copyright Act (DMCA), whose Section 1201 made it a felony to traffic in “circumvention devices” that bypassed “access controls” for copyrighted works.

Broadly, that meant that you could go to prison (for five years!) for making anti-DRM tools. What’s more, DMCA 1201’s drafters rejected tying the law to acts of copyright infringement, making it illegal to remove DRM, even if you did so for a perfectly legal reason.

For example, if your games console had some code that ensured that the software you were running had been taxed by the manufacturer, then removing that code could become a criminal act — even though that has nothing to do with copyright infringement.

To make that concrete: copyright is supposed to help creators and audiences transact with one another. If you own a console and I wrote some software for it, then copyright should facilitate you paying me money for it and then running it on your console.

But if the console’s manufacturer had designed its product so that it got to impose a tax on transactions like this, then I can’t sell you my copyrighted work anymore unless I pay the tax. Doing so is a felony, but not because it infringes copyright.

No, it’s a felony because it’s bad for the manufacturer’s shareholders. It’s what Jay Freeman calls “Felony Contempt of Business Model.”