Former ACT | The App(le) Association policy officer admits small companies don't pay people like him: panel debate on EU SEP Regulation proposal

It speaks volumes about Apple's values that even after Bloomberg exposed ACT | The App(le) Association as an astoturfing operation, they still attempt to fool policy makers--such as European Commission officials--into believing that ACT represents small app developers and IoT startups. They continue to issue statements, to lobby policy makers, to organize events, and to participate in debates--all of that in the name of small companies, even when they actually work against them, such as on App Store issues.

The European Commission should not invite them to events unless Apple sends them to speak on its behalf, which would be the only honest thing to do. But I may be asking for too much.

Bloomberg's investigative journalism was highly effective regardless of whether the EC turns a blind eye to its results. ACT itself was forced to admit that Apple paid for more than half of its funding, and then Bloomberg managed to talk to four former ACT employees (ACT is, by the way, set up as a company) who said that "more than half" was a gross understatement and that ACT simply takes directions from Apple.

A former de facto ACT employee indirectly and inadvertently threw the organization under the bus on Friday: Alexander Prenter, a Brussels-based native New Zealander who is now a policy officer at the Fair Standards Alliance. I wish to make it perfectly clear that Mr. Prenter is well-respected, as is the Fair Standards Alliance (FSA). I am actually happy for him that he joined the FSA in July 2021 after several ears of working for ACT. Whether or not one agrees with the FSA--and I could have various disagreements with them during the EU legislative process that is about to start--they are transparent about their membership as opposed to just claiming to speak for thousands of companies no one has ever seen or heard of.

At a webinar held by the European University Institute on Friday (May 19), the EC's proposed regulation on standard-essential patents (SEPs) was discussed. Professor Jorge Contreras (Utah), Michael Schloegl (Continental), and Alexander Prenter took pro-implementer positions, essentially saying the proposal doesn't go far enough, while Urska Petrovcic (Qualcomm) and Richard Vary (Bird & Bird, a firm that advises and represents not only SEP holders like Nokia but also implementers) believe it goes too far. What came up in several interventions was the lack of hard evidence for the need to legislate on the subject.

While the Commission's Directorate-General for the Internal Market, Industry, Entrepreneurship and SMEs (DG GROW) seeks to justify this bill with the alleged plight of SMEs forced to deal with SEP licensing and litigation, the impact assessment provides anecdotal evidence (apart from being unverifiable, some of it even implausible) at best. In the end the Commission relies on about three dozen SMEs who have provided input (again, this is totally unverifiable, and last year I debunked a totally made-up SME-SEP story that was paid for by the same lobbying entities pushing for an EU SEP law). But only a couple of them ever actually licensed SEPs.

Mr. Prenter attempted to explain away the conspicuous absence of evidence for actual SEP issues faced by SMEs. He said SMEs don't employ someone like him to fill out questionnaires. That was an interesting admission considering that ACT does claim to represent SMEs, does orchestrate submissions by companies claiming to be SMEs facing SEP issues, and Mr. Prenter worked for ACT from 2017 or (at the latest) 2018 until 2021.

In other words, Mr. Prenter conceded that SMEs don't pay for ACT's work (as Bloomberg had also found out).

A 2018 "Study on safety of non-embedded software" refers to an "Interview [with] Brian Scarpelli and Alexander Prenter, ACT, 16 March 2018."

The SME topic also came up at a recent Brussels presentation of two DG GROW-commissioned "studies" by "researchers". Licensing expert Eric Stasik explained that it simply isn't profitable for SEP holders to approach every small implementer and work out a license deal. As Mr. Stasik explained, you'd like to generate that additional licensing income if you're a SEP holder, but you can't economically justify it.

At least a couple of participants in that event agreed that patent pools could actually help get SMEs licensed to a greater extent. By virtue of transactional efficiencies, pools might make it profitable for SEP holders to grant licenses to SMEs. While that particular pool wasn't mentioned, I think Sisvel's recently-launched NB-IoT pool has the potential to prove helpful in this context.

My own position on this topic is somewhere in the middle between the two camps:

• Mr. Stasik is right that SEP licensing is not a practical issue for SMEs, simply because SEP licensing is a high-volume business and SEP enforcement is too expensive. As a litigation watcher, I have yet to see a case where a small company actually gets sued over a SEP. The relatively smallest one I've seen so far is AVM, a company that has a 70% market share in the German WiFi router market. Even AVM is not an SME by the EU's criteria.

• DG GROW should admit that the ones who are really pushing for the EU SEP Regulation are Apple (directly and via entities like ACT) and the automotive industry. They should be honest about it.

• But I also agree with those who say that infringement--even if tolerated for the reason identified by Mr. Stasik--is not a sustainable basis to do business.

• I furthermore agree that SMEs are increasingly implementing FRAND standards.

If the Commission wanted to engage in further outreach to SMEs that implement standards, organize events, hold confidential conversations with SMEs about SEP licensing issues, I'd welcome such initiatives in principle. But why legislate now? Why in that particular form that is unbalanced and poorly-thought-out? The more appropriate thing to do would be to keep an eye on the situation and take incisive action only if and when there is hard evidence for SMEs facing serious problems on a significant scale. It will become known if there's a lot of enforcement activity against small companies (which will probably never be the case). If SMEs ever faced a serious problem, the most important question would be how to help them without putting a thumb on the scales in favor of the likes of Apple to the detriment of those who invest in standards-related innovation and need licensing income to fund that effort.

The dispute resolution mechanisms proposed by the Commission will be too costly even for most SMEs. I would expect the average SME to simply decline to participate in any FRAND conciliation proceeding for cost reasons.

Europe--like the rest of the world--has enough problems that are real. It's better to focus on those issues instead of listening to fake SME organizations or SMEs who may be real but whose SEP stories would be debunked as nonsense or insane exaggerations if only they were scrutinized by experts.

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UK patent office declines to base standard-essential patent policy on 'anecdotal evidence from bodies representing smaller businesses'

The ink is barely dry on Justice Mellor's InterDigital v. Lenovo ruling, and there is more news from the United Kingdom concerning standard-essential patents (SEPs). The UK Intellectual Property Office (IPO) is seriously contemplating some policy-making (potentially legislative) initiative related to SEPs. But it wants to see hard evidence that intervention is needed to protect small and medium-sized enterprises (SMEs). To put it bluntly, the IPO is not going to be fooled by lobbyists claiming to represent SMEs while actually working on behalf of large implementers who want to bring down their patent licensing costs.

A few months ago, I was--frankly--shocked that a senior IPO official had accepted an invitation to speak at an ACT | The App(le) Association event, but also relieved to find out from the Office that they were absolutely aware of the fact that Apple funds ACT. I wish the European Commission could wake up and acknowledge this problem, too. The EC allowed ACT and its Google-controlled equivalent called Developers Alliance to participate in a Digital Markets Act workshop earlier this month, claiming to represent small app developers while actually lobbying for the abusive behemoths, a highly problematic practice called astroturfing.

On Tuesday, the UKIPO started a new consultation--though it had already called for views on SEP policy last year--with a questionnaire that will be available until April 24. The UKIPO's website reflects a profound understanding of the topic. What I particularly like is the following statement by the IPO's Acting Director of Business and International Policy, Sarah Whitehead, in an explanatory video:

"However, although we have some anecdotal evidence from bodies representing smaller businesses, we did not hear sufficient evidence directly from UK SMEs, small-cap and mid-cap businesses, including their experiences of interacting or using technical standards when innovating." (emphasis mine)

That is so spot-on.

The system of industry standards--and the licensing ecosystem built around it--is too important to intervene just on the basis of what lobbyists and (especially) astroturfers say.

Apple has not been an SME for about 45 years, much less a UK SME.

There are two "phenomena" in SEP policy debates in the Western hemisphere. Huawei, despite being a large-scale innovator and very reasonable licensor (that also knows the licensee's perspective), is often used as a bogeyman. And on the other end of the spectrum, there are those claims of SMEs--which policy-makers instinctively seek to shield from abuse--being on the receiving end of SEP abuse. I urge skepticism, and I commend the UKIPO for setting a reasonably high evidentiary standard. There cannot be responsible policy-making without it, but again, as the European Commission's recent DMA workshop showed, deceptive lobbying is rampant and some policy makers just don't have the guts to reject dishonest input.

I trust that the IPO will carefully analyze whatever stories it will be told, and will insist on hard evidence. For instance, the Save Our Standards campaign sponsored an interview by an IoT blogger with a U.S. SME, and for me it was easy to figure out that the SME in question never actually had to license SEPs (and not even the customer for which it developed the app they primarily discussed in that interview).

It's great that the UKIPO finds anecdotal evidence from those representing (or, more accurately, claiming to represent) SMEs unreliable. In the next step it's going to be key to scrutinize whatever input will be given by actual SMEs. If those SMEs are just service providers, their input is meaningless. If they make actual products, what issues are they really facing? And do they really need government intervention or would there be reasonably acceptable solutions under the existing framework?

On LinkedIn I raised the following question:

"If SMEs have such a huge problem with SEPs, where are all the SEP enforcement actions against SMEs? Maybe that's (one of) the first question(s) policy makers should ask when they launch consultations on this topic."

I'm a litigation watcher. If SMEs got sued over SEPs all the time, I'm sure I'd have noticed. The relatively smallest company I've recently seen on the receiving end of SEP enforcement is the German WiFi router market leader (70% share!), and the Munich I Regional Court has identified it as an unwilling licensee.

In 2019 I organized a SEP licensing conference in Brussels. The relatively smallest companies who participated and talked about SEP licensing issues were Nordic Semiconductor, AirTies, and Kamstrup. Now, let's put that into perspective:

• Nordic Semi "has more than 1300 employees across the globe" and a market cap north of $3 billion.

• AirTies was bought out by a private equity fund, Providence Equity Partners, in 2022.

• Kamstrup was founded in 1946, has "employees in more than 20 countries around the world and [is] owned by the Danish energy company OK."

I would argue that each of those three companies has the resources and the sophistication to respond to SEP royalty demands. As does AVM, that German WiFi router maker I mentioned.

Why is SEP litigation against SMEs so hard to come by? Because enforcement against them is not profitable. But only widespread litigation would be hard evidence of an issue serious enough to warrant legislative intervention.

I hope the UKIPO will remain skeptical of the input that it's now going to receive, knowing that some of it will be orchestrated by Apple-funded lobbying entities. And I would encourage the European Commission to do the same.

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Apple increased U.S. lobbying spend by 44% in 2022, steeper hike than any other Big Tech company--and engaged in astroturfing on top of it all

For my esteemed readers, Apple's lobbying activity is relevant with a view to mobile ecosystem regulation and/or (depending on a given reader's priorities) patent policy. CNBC reports that "Apple ramped up its lobbying spending last year, increasing its total for the year by 44% compared to 2021, according to public disclosures." For 2022, Apple disclosed a total D.C. lobbying spend of approximately $9.4 million. Is that new total--which still trails behind a few other Big Tech companies--a meaningful number? Absolutely positively not.

Let's please take all of those disclosures with a grain of salt. Total transparency in lobbying is utopian. A lot of what's going on in the industry is in a gray area and not strictly lobbying.

While those transparency rules capture only a subset of the actual spend, one can still infer something from relative changes, based on the--unfortunately unverifiable--assumption that a company's degree of transparency hasn't changed too much during the same period.

On the subject of plausibility, in Apple's case it's easy to see that 2022 was a critical year: Apple sought and managed to dissuade Congress from adopting the Open App Markets Act (OAMA). I still believe the OAMA can be resuscitated. In principle, even the Republican House majority acknowledges that something must be done to protect app developers against the abuse that is happening on a daily basis. But Republicans would rather not empower the federal government too much, especially not with Lina Khan at the helm of the FTC. In a Wall Street Journal opinion piece, former Attorney General William Barr (appointed by, but never in thrall to Donald Trump), argues against an overhaul of the antitrust laws, yet he is right that "case-by-case antitrust litigation alone won't rein in Big Tech" and that "a coherent response to the multifaceted problems caued by Big Tech's dominance" is needed.

In Europe, App Store-specific rules are going to make an impact, though in 2024 at the earliest: the EU's Digital Markets Act (DMA) takes time to be implemented, and in the UK, similar legislation often referred to as the DMU (the Competition & Market Authority's Digital Markets Unit, which will enforce the envisioned law) is also approaching fast (meanwhile, Apple is challenging--on a basis I consider reasonable--a market investigation reference by the CMA). But the U.S. is Apple's largest market, and since Apple unilaterally imposes on app developers a forum-selection clause in favor of the Northern District of California--where it then argues that it is immune under the Foreign Trade Antitrust Improvements Act (FTAIA)--there is another reason for which it is the single most important jurisdiction for Apple.

Enforcement in jurisdictions such as Brazil has the potential to make a difference. For example, I believe that South Korean lawmakers, who pioneered mobile app store legislation (which is separate from the antitrust enforcement action against Apple in the same jurisdiction), encouraged other legislatures (such as in the EU) to take similar steps. Also, we need initiatives--regulatory as well as legislative, and litigation, too--in all of the major markets because chances are that Apple will not stop its abusive conduct wherever it is not required to do so under the law. Google, by contrast, may at some point prefer to have one set of rules around the globe, though it's definitely not there yet.

Apple's U.S. lobbying spend is not limited to the federal level. They also had to fend off various state law initiatives concerning the App Store as well as the right to repair. The numbers CNBC's article refers to are exclusive of state-level lobbying.

But even at the federal level, Apple spends a whole lot more than that sub-$10M amount. ACT | The App(le) Association alone has a budget of about $10M per year and is largely funded by Apple as Bloomberg's Emily Birnbaum uncovered. Some of that is obviously spent at the state level and in Brussels. Nevertheless, it shows what is actually being spent on lobbying.

Some of the soft costs are also huge. Reportedly, Tim Cook had a number of meetings on Capitol Hill. If one looked at all of the hard and soft costs involved, his meetings alone have likely cost Apple more than the $9.4 million they reported.

It's time for some serious federal antitrust enforcement action against Apple. The DOJ may want to wait for the Ninth Circuit opinion in Epic Games v. Apple, which could be very helpful with a view to market definition, but whoever loses will appeal that decision to the Supreme Court and, potentially, petition for a rehearing en banc before doing so.

The DOJ is claimed to be about to file a second Google lawsuit, which will focus on ad tech (the first one will go to trial later this year). I'm not against that, but I'm not enthusiastic either because I don't like the optics of Google being sued for a second time before Apple gets slapped, whic his why I said the following on Twitter:

The DOJ may be able to prove harm to the competitive process in this context, but the mich bigger issue facing the advertising industry is App Tracking Transparency.

Why is the DOJ bringing a second Google case before a first Apple case? https://t.co/dLCk38bvPL

— Florian Mueller (@FOSSpatents) January 24, 2023

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ASTROTURFING: "Gross, Apple" says CWA labor union as iPhone maker creates fake labor union in Ohio, controlled by Apple management just like its fake app developer association

Another bad apple has been exposed, raising the question of how bad Apple is. Has Apple become the least ethical Big Tech company in history? It is shocking to see in what extremely dishonest behavior Apple engages against the stakeholders it is exploiting: certain categories of employees, and app developers. Apple treats all of them as serfs, and there is an astounding parallel: Apple doesn't want those serfs' voices to be heard and interests to be represented. Just like they believe that only Apple (and not users) should decide what apps to download (and from what monopolistic App Store with its abusive terms) to download, Apple employees shouldn't speak for themselves but instead join a fake union that is just a sock puppet for Apple's management.

There have been other complaints with the National Labor Relations Board (NLRB) over Apple's "union-busting" efforts, some of which are mentioned in CNET's latest article on a Communications Workers of America (CWA) complaint that Bloomberg (paywalled) was first to report:

Scoop: Apple illegally created a pseudo-union to sap support for independent organizing in Ohio, @CWAUnion alleges in new labor board filing. Also accuses Apple of holding mandatory anti-union meetings and making false claims about bargaining https://t.co/zrw2WvmtYG

— Josh Eidelson (@josheidelson) December 16, 2022

“If management actually cared about workers having a voice on the job, they would direct them to Apple Retail Union/CWA which is run by workers, not bosses.” https://t.co/zrw2WvmtYG https://t.co/vpscdmueNa

— Josh Eidelson (@josheidelson) December 16, 2022

The complaint form (just a one-pager) is has been published by The Register (PDF) (here's the Register article itself). The "Basis of the Charge" has three parts, and the final one says:

"Creating and soliciting employees to join an employer-created / employer-dominated labor organization as a means of stifling Union activities."

The CWA--which by the way supports Microsoft's acquisition of Activision Blizzard because it will faciliate unionization of Activision employees--announced that complaint on Twitter, and retweeted the announcement with a comment: "Gross, Apple."

Gross, Apple. https://t.co/ytlg7adtUe

— CWA (@CWAUnion) December 16, 2022

Gross it is indeed, but it's a pattern that seems familiar. In September, Bloomberg reported that ACT | The App Association--a fake app developers association--receives the vast majority of its funding from Apple and, according to former employees, is simply run by Apple. I only ever attended one ACT event (in Berlin in 2019), and I was the only app developer there. Also, I can't think of any app developer who would benefit from the positions that ACT takes on whatever issue, but on many key questions involving Apple's App Store monopoly abuse, ACT | The App(le) Association works against us.

App developers are to Apple what drivers are to Uber and other "gig economomy" companies. We're not going to be able to unionize, and there are reasons for that, but at least Apple should not let some Washington D.C. lobbyists on its payroll claim to represent us while actually working against us.

The ACT-Apple link is well-known and even the UK Intellectual Property Office has recently acknowledged it in a reply to FOSS Patents. A European Parliament vice president who was arrested this month over corruption charges served on the boards of astroturfing operations that collaborated with ACT and another Apple-funded group, CCIA.

Apple even used ACT to commission a paper by Charles River Associates. And they met with members of EU antitrust and digital policy chief Margrethe Vestager's cabinet, opposing an initiative that can contribute to the fight against climate change.

Given that it looks like the Open App Markets Act (OAMA) may not be passed into law by U.S. Congress during the impending end of the current legislative term, the problem is that Apple's tactics tend to work. Apple stops at nothing to get its way. But the more of this type of conduct gets exposed, the more setbacks Apple will suffer in the legislative arena and in litigation.

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EU Parliament VP arrested for corruption charges served on Big Tech astroturfing operations' boards, one of which partnered with Apple's ACT | The App Association and Apple-Google-funded CCIA

These days, the #1 topic in EU politics is that "European Parliament Vice President Eva Kaili has been arrested in an investigation into suspected bribery by a Gulf state" (BBC). "Cash worth about €600,000 ($632,000; £515,000) was seized by Belgian police in 16 searches in Brussels on Friday."

Eva Kaili is, of course, innocent until proven guilty. Even if those accusations were ultimately proven to be correct, some people would go to jail only because they did in secret--with bags of cash--what many hundreds, if not thousands of Members of the European Parliament have lawfully done. Corruption is not prohibited in the EU Parliament as long as it is officially declared as a "job" or a "consultancy." A leading German constitutional scholar criticized that practice as "legalized corruption"--with one particularly controversial example having been an MEP who was--at the same time as he was a parliamentarian--the head of media conglomerate Bertelsmann's EU lobbying office.

Today, Politico published an opinion piece by a professor, proposing various reforms in light of the Kaili scandal. In response to Politico's tweet about that article, Sebastiano Toffaletti--Secretary General at the European DIGITAL SME [small and medium-sized enterprise] Alliance--said the arrested vice president of the EU Parliament "is clearly linked to at least two of the 'SME or startup associations' accused of being linked to #bigtech":

Great ideas! How do you suggest to tackle the issue of astroturfing? Eva Kaili is clearly linked to at least two of the "SME or startup associations" accused of being linked to #bigtech. https://t.co/2oTTMLtaXr

— Sebastiano Toffaletti (@sebastianobxl) December 11, 2022

There are various so-called SME or startup associations out there that are just astroturfing for certain Big Tech companies. In October, three well-respected Members of the European Parliament with a focus on digital industry policy filed formal complaints with the European Commission. And indeed, at least two of the organizations in question--Allied for Startups and SME Connect--also secured Mrs. Kaili's services (though I'm sure they did it legally, not with bags of cash).

First, SME Connect on Sunday still listed Mrs. Kaili as a board member (click on the image to enlarge):

The following screenshot is from Allied for Startups' annual report, and on the right you can see Mrs. Kaili's picture as she served on that organization's advisory board (click on the image to enlarge):

Allied for Startups lobbied against the Digital Markets Act (DMA) and the Digital Services Act (DSA), and in those contexts signed statements with CCIA, which has been funded by Google for a long time and is now also supported by Apple, as well as ACT | The Appl(le) Association, which as Bloomberg revealed in September receives most of its funding from--and takes directions from--Apple. The following two screenshots prove the connection (click on an image to enlarge):

I agree with Mr. Toffaletti that the EU should take action against astroturfing, but the European Commission even condones it from time to time. On Tuesday, ACT | The App(le) Association will get to lobby for Apple while claiming to represent small app developers and IoT device makers at an event (How Standards help Small and Medium-Sized Enterprises (SMEs) to Innovate, Compete, and Grow) that is co-organized by the European Commission's Directorate-General for the Internal Market (DG GROW) and the United States Department of Commerce. Someone forgot to invite Mrs. Kaili though. Or maybe they did invite her, but under the circumstances she can't participate...

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UK Intellectual Property Office acknowledges 'widely reported link between ACT and Apple' ahead of panel on standard-essential patent enforcement

Astroturfing is a disease, and relentlessly exposing it is the cure. I make my little contribution to the fight against astroturfing, and I'm grateful to several Members of the European Parliament for having officially complained to the European Commission about certain manifestations of the problem (with more to come).

ACT | The App Association, a group that claims to represent the interests of small app developers and IoT startups but is in reality just a lobbying front for (and overwhelmingly funded by) Apple working against app developer interests and promoting the devaluation of standard-essential patents (SEPs). On Friday I noticed that ACT | The App(le) Association will host a panel on "global licensing of SEP's [sic] and its broader impacts" on Tuesday (December 6). They announced two speakers:

• "Mr Jamie Lewis, Head of Industrial Policy at the UK Intellectual Property Office (UK IPO), will be the keynote speaker at the event."

• "Professor Renato Nazzini of King’s College London [...] will be one of the panellists." (the double L is not a mistake in a strict sense, but the more common spelling not only in the U.S. but also the UK is "panelist")

I informed Professor Nazzini of what ACT is all about, so he knows about the astroturfing problem, but he may be more interested in whatever relationship he has with Apple, just like Charles River Associates recently published a paper commissioned by ACT (i.e., paid for by Apple). Obviously, Professor Nazzini's participation in that event means that one has to view him as an Apple ally (to say the least) whenever he speaks out on, or writes about, SEP policy.

However, I don't consider it appropriate for a government agency to engage in anything that could be interpreted as lending legitimacy to astroturfing. To be clear, there would be nothing wrong with the UK Intellectual Property Office (UKIPO) speaking

• at an Apple event that is properly labeled as such (provided that it then also speaks at events hosted by various other companies, which would keep a UKIPO official busy for some time),

• at an event hosted by a lobbying agency or other service provider (such as Charles River Associates) that takes money from Apple (again, provided that the actual backers are properly disclosed and that the other side of the debate will get equal treatment), and

• even at an ACT event if ACT finally admits that it is not an "App Association" but simply an Apple Association.

While ACT itself is probably not going to make that admission until it is dissolved, I appreciate that that the UKIPO's press office responded to my inquiry on Friday. A spokesperson for the UKIPO said:

"We can confirm that an IPO representative will participate in a third party organised event on 6 December 2022. Neither the IPO, or its representatives, are affiliated to ACT. We are also aware of the widely reported link between ACT and Apple." (emphasis added)

That awareness was presumably lacking when two members of the busy cabinet of EU competition and digital policy chief Margrethe Vestager met with ACT shortly before Bloomberg reported on what ACT is all about.

The UKIPO spokesperson went on to explain:

"The IPO’s aim is to gather robust evidence on SEP policy through good evidence gathering principles. This means reaching a wide audience of industry and sectors across the UK. At each stage of engagement in this area, we continue make clear the need for appropriate evidence before the government proposes any policy interventions.

To date, we have heard extensively from SEP holders and major implementers. We also need to reach others including smaller businesses, researchers and key sectors such as the automotive industry." (emphasis added)

Well, if the UKIPO wants to engage with smaller businesses, ACT is certainly not the right platform. But to their credit, they have acknowledged the ACT-Apple link. Now they just shouldn't believe that Apple is paying ACT to represent small business interests. Much to the contrary, ACT is the enemy of small app developers in the App Store antitrust context.

Small businesses rarely have to deal with SEP issues anyway. ACT has been desperately trying for a while to find any example of a small business that actually received royalty demands or threats of litigation, which is why ACT--under the Save Our Standards label--presented a service provider as a potential victim of SEP abuse, but the example that the company in question gave was clearly an app that couldn't infringe SEPs.

The UK IPO statement concluded as follows:

"We are currently participating in a range of engagements including speaking opportunities from implementer representatives, standard development organisations and other relevant events.

"We continue to engage with all parties with an interest in SEP policy and the wider regulatory environment so we can achieve a balanced approach for innovation in the UK."

Laudable though the objective of engaging with all sorts of stakeholders may be, astroturfers do not deserve the participation of government officials in their events, much less as keynote speakers.

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ASTROTURFING: Where was Charles River Associates' economic expertise when Apple funded their paper criticizing 5G patent ownership studies? Where was CRA's common sense?

Charles River Associates (CRA) is a high-profile all-things-to-all-people economic research firm. According to CRA's website, the organization's clients include 78% of the Fortune 100. In order to maximize their profits and keep 800+ consultants from 50+ countries busy, they have to work for a diversity of clients and on a multitude of issues. They can't always be right, nor can they always be wrong. It depends. I've agreed and disagreed with what I've seen from them on issues I'm interested in, and I've found them to be on the right (procompetitive) and at times on the wrong (anticompetitive) side of history--but never would I have doubted that they are good at what they do.

Policy makers, regulatory authorities, and judges are smart enough to know that the C in CRA doesn't mean "charitable." Journalists will understand that, too. But an organization like that needs to maintain a certain minimum standard to preserve its credibility. Credibility has (at least) two aspects in this context:

• economic competence

  and

• compliance.

CRA must now correct the disclosure on its November 8, 2022 paper on 5G standard-essential patent (SEP) ownership--A critical review of 5G SEP studies--to make it perfectly clear that it was overwhelmingly (if not entirely) funded by Apple or remove the document from its website. Anything less would be disappointing to say the least.

Apple obviously has an interest in devaluing SEPs and doubting the value of the 5G SEP portfolios of companies with which it has not yet agreed on license terms, just like CRA has an obvious interest in serving the world's richest corporation, even if it means going against consumer interests such as in a recent French antitrust case, where CRA not only disclosed but even boasted with its work for Apple.

Also, it's not generally a bad idea to call into question the reliability (as evidence) of certain patent ownership studies. CRA's paper looks at studies by various organizations, including some that were created by IPlytics--the same IPlytics that I criticized for not listing Huawei among the top 10 narrowband IoT SEP owners in 2020 though in 2022 the company (credibly and finally) was ranked first. But CRA's paper appears somewhat selective to serve Apple's interests.

When Apple--in the midst of litigation as well as policy debates around the globe--pays CRA for a paper on 5G SEP ownership, they should say so. But they didn't. This screenshot--a part of the title page--shows the problem (click on the image to enlarge):

ACT. That's the Apple astroturfing operation that Bloomberg exposed in September--two months before CRA published that 5G paper (and given how thin that paper is, it's actually possible that the Bloomberg article even appeared before CRA started working on that 5G paper).

How can Charles River VP John Hayes and his associates Assaf Zimring and Ben Ladabaum ever have had the slightest reason to believe that 5,000 small app developers and IoT startups were funding their work?

Didn't they do any background check, such as with Google, to get an idea of what ACT is all about?

Two members of European Commission EVP Margrethe Vestager's cabinet met with ACT shortly before the Bloomberg story. CRA, however, had every opportunity to know that this was an Apple-funded paper. Maybe Apple even discussed the topic with them. Apple is a client of theirs, and may be paying CRA more than any other client these days. But let's give them the benefit of the doubt and view this in the light most favorably to CRA. Let's assume that ACT introduced themselves as an organization representing 5,000 small app developers and IoT startups. Wouldn't an expensive economic advocacy firm like CRA--whose clients include 78% of the Fortune 100--reasonably ask itself whether those little guys really have the wherewithal to afford their services? It would take very simple math--even simpler than what's in that paper: they could just have divided their fees by the official (and unproven, but that's another story) number of ACT members, and they could have figured that small companies wouldn't pay membership dues to an organization like ACT that would pay even just for that CRA study, let alone ACT's overall operating costs of approximately $10 million a year.

If John Hayes, Assaf Zimring, and Ben Ladabaum believe they understand 5G patent economics so well that they must publish a paper to educate the world about the subject, shouldn't they also know that small app developers simply don't have problems with SEP licensing or assertions?

Where was CRA's common sense here? Where was their economic expertise? What plausibility tests did they perform? Again, all of this is based on the assumption that Apple wasn't actually talking directly to them about this study, but that ACT introduced themselves as an organization claiming to represent 5,000 small app developers and IoT startups.

CRA and those three economists can do better than that. That's why they should correct the paper and disclose Apple as their actual client--or pull the paper altogether.

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Apple's climate change hypocrisy and deceptive lobbying: ACT | The App(le) Association lobbied EU Commission EVP Vestager's cabinet against waste reduction policies on September 8, 2022

Apple's positions on climate change require greater scrutiny (as to its privacy and security claims and other talking points). Let me start with a quote from an article that appeared on the website of the Tech Transparency Project on May 31, 2022:

‘Green’ Apple Backs Business Groups Stalling Action on Climate Change

Apple CEO Tim Cook talks about a ‘greener’ future. But his company is a member of business associations fighting efforts to reduce greenhouse gas emissions.

The Tech Transparency Project names such groups as "the Texas Association of Business, which has questioned whether humans are causing climate change and has a long history of fighting against regulations designed to curb carbon emissions." And it says that seven of the industry associations Apple disclosed in 2020 to be involved with oppose right-to-repair legislation. The first one on the (alphabetical) list: ACT | The App Association, an astroturfing group that Bloomberg exposed in September as being overwhelmingly funded by Apple and falsely claiming to represent the interests of small app developers.

Just about a week before that Bloomberg article, which (as I also said in my previous post) should dissuade any policy maker from ever taking ACT seriously, ACT seized one opportunity--which should be the last--to attempt to fool the European Commission.

Thanks to the AskTheEU website it has become known that on September 8, 2022, at 2 PM Brussels time, two unnamed representatives of ACT | The App(le) Association met with Mrs. Alina-Stefania Ujupan and Mr. Alejandro Cainzos, members of the cabinet of the European Commission's Executive Vice President (in charge of competition enforcement and digital industry policy) Margrethe Vestager as the following minutes of the meeting show (click on the image to enlarge or read the text below the image):

This is the summary:

"In a short meeting, the App Association raised their concerns regarding the draft Ecodesign Regulation for Mobile Phones, Cordless Phones and Tablets, claiming that giving users the ability to switch back to Operating System versions older than the last two available would create difficulty for App Developers to ensure the cybersecurity of their applications. Cab Vestager took note of the views expressed and recalled the important aims of the Regulation to reduce electronic waste." (emphasis added)

ACT--which receives the vast majority of its funding from Apple and doesn't even have regular membership dues for small app developers--emailed Mr. Cainzos on July 11, 2022. The subject line was "Meeting request with the App Association on the new Ecodesign Regulation proposal." ACT | The Apple Association said it "wanted to flag some concerns [they] have on the proposals in the draft regulation" and asked:

"Would you be available for a short meeting in the next couple of weeks to discuss further the potential impact of this regulation on small app developers?" (emphasis added)

The world's richest corporation, lobbying against environmentally sound policies in the name of "small app developers" while engaging in greenwashing all the time...

There are simply two reasons why Apple does not want users to be able to switch back to older iOS versions:

• Apple wants users to buy new devices as frequently as possible.

• Apple wants to save software development costs, so they don't want to keep older iOS versions secure and ensure backward compatibility of apps with older iOS versions.

Is this of concern to small app developers? Seriously, the average small app developer wouldn't even be aware of the European Commission preparing an Ecodesign Regulation for Mobile Phones, Cordless Phones and Tablets. ACT has a budget of approximately 10 million dollars and claims to represent 5,000 small app developers, which would mean that the average member would have to pay annual membership dues of 2,000 dollars. In reality, Apple foots the bill, and those 5,000 "members" are just a claim. On ACT's website, one can only find a few dozen companies, and they're mostly service providers (as opposed to app makers who publish their own products). I attended an ACT event in Berlin in September 2019, and I was definitely the only app developer in the room...

Do small app developers have a "cybersecurity" problem if users can switch back to older operating system versions, as Apple's astroturfers told the Commission?

Being an actual app developer, what I can say is that, generally speaking, fragmentation is not in our interest, and that's a concern that should be taken seriously. I say so even though I also advocate competition enforcement against Google in the Android context, where Google makes "anti-fragmentation" arguments all the time.

However, what makes no technical sense here is that our own apps would have "cybersecurity" problems if Apple simply allows more backwards compatibility. If our code is secure on the latest version of iOS, why would it be insecure on an older version? Only if Apple doesn't keep older versions sufficiently secure.

Small app developers like my company actually have a problem with Apple's planned obsolescence of products. When we write software for desktop operating systems today, we can rely on that software still being functional and available to end users in, say, ten years from now. On mobile platforms, especially iOS, we are forced to upgrade software to newer API versions all the time. Apple (and Google) could add features and still ensure backward compatibility. They could expand their APIs without deprecating old APIs after a short while.

One example is that Apple decided to make version 2 (and, as a result, all subsequent versions) of its Swift programming language incompatible with version 1. That's because Apple recognized some design mistakes: there were features in Swift 1 that seemed innovative at first, but adversely affected code legibility. Instead of remaining backward compatible, Apple stopped supporting newer iOS API versions in Swift 1. In 2018, Apple then gave developers an ultimatum: upgrade to a newer API version (which implied upgrading from Swift 1 to a newer version of the language) by a certain date, or you can no longer update your app--which was definitely not good for cybersecurity because developers must update an app to fix a security issue in the code.

Simply put, Apple doesn't care about the burden on small app developers, but its lobbyists masquerading as representatives of small developers hoped the Commission would be swayed on that basis. "Look at us poor little guys. Don't you have sympathy with us?" Astroturfing at its worst.

The best part of the minutes of that September 8 meeting between two members of EVP Vestager's cabinet and ACT is that they stressed the policy goal of waste reduction, which suggests to me that ACT's fake small developer arguments were unpersuasive.

The worst part, however, is that two (!) members of the cabinet of one of the key players of the European Commission wasted some of their precious time with Apple-funded astroturfers. Maybe they'd have canceled the meeting if the Bloomberg article on who really funds ACT had been published just a couple of weeks earlier (and if they had seen it in that case).

Should ACT get any more meetings with any member of cabinet of any EU commissioner now that it has been exposed as an Apploturfing operation, someone should start a petition for the EC to get a free Bloomberg subscription...

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Clouded in secrecy: presumptively Amazon- and Google-backed U.S. lobbying front (Coalition for Fair Software Licensing) sets new opacity record by not listing any members

In the previous post I quoted from the official complaints of three Members of the European Parliament (all of them well-respected experts in technology policy-making) alleging violations of EU transparency rules by Google, Amazon, CCIA (an entity funded by them as well as by others, such as Apple), Meta, and four smaller lobbying fronts. There are strong indications that some of the same organizations--the ones whose names I just put in bold face--are also involved, in one form or another, with a dubious lobbying entity based in Washington, D.C., named "Coalition for Fair Software Licensing" (CFSL). That one was launched only a couple of weeks ago.

The extent of astroturfing by some Big Tech companies is as appalling as it is becoming absurd. I will call them out, relentlessly.

The CFSL was started to advocate in the U.S. nine of the ten principles for software licensing in the cloud that have previously been espoused by Amazon-backed CISPE in the EU. The primary targets of both CISPE and CFSL are Microsoft and Oracle. CISPE has been trying for a while to instigate an EU antitrust investigation against Microsoft, but the latter's new software licensing terms create new opportunities for the very type of company CISPE pretends to speak for: European cloud service providers (CSPs). I just emphasized the word "pretends" for a couple of reasons:

• It's paradoxical that a group claiming to promote European digital sovereignty is primarily funded by Amazon, the biggest bully on the cloud services block. No company diminishes the business opportunity for European CSPs even half as much as Amazon does.

• Benjamin Henrion, who was a key player in the fight against the EU software patents directive, drew my attention via Twitter to a recent event in Brussels where the CEO of a key complainant--Nextcloud--said (via video) that he didn't want to work out a solution when Microsoft contacted him: he prefers to keep fighting.

  If I were an antitrust enforcer, I'd be unprepared to investigate a complaint by someone with that attitude. There's nothing wrong with having a set of values, but regulation is more like litigation than like legislation in the sense that if someone has a problem and the problem can be solved, a settlement is preferable--also from a public-interest perspective--over an unnecessary dispute. Mr. Karlitschek's belligerence raises the question of whether he's actually complaining as the CEO of a German open source company or as a sock puppet for Amazon. By contrast, the CEO of Epic Games is very serious about opening up mobile app distribution, but last year he testified under oath that if Apple had offered him terms that Epic would have considered acceptable, he'd have accepted them (which doesn't mean giving up one's policy positions). A smaller app developer, Kosta Eleftheriou, settled his U.S. litigation with Apple last month (previously he fended off Apple's motion to dismiss), yet keeps criticizing Apple's App Store terms and practices. Those who truly face a problem will be open to working out a solution.

  It's also remarkable that Nextcloud's CEO claimed to know that the EU Commission would soon launch an investigation. Not only may DG COMP--which has to prioritize wisely--very well conclude that Microsoft's modified licensing terms satisfactorily address any potential concerns, but even if an investigation was imminent, the Commission would communicate it through other channels than having a complainant reveal its plans at a small conference.

  Interestingly, right after Nextcloud's Frank Karlitschek, Quentin Adam--the CEO of Clever Cloud-- raised some issues that small European CSPs are more concerned about, such as Google's advertising business (against which the EC is reportedly preparing a Statement of Objections) and Amazon's pricing model being allegedly designed to complicate multiclouding (combining services from multiple CSPs).

It really looks like some who complain about unfair software licensing terms would actually prefer to divert attention away from their own terms and practices, hoping to use the regulatory process to cement their own market position.

That newly-created Coalition for Fair Software Licensing has an "About the Coalition" page--but it doesn't list a single company. There's a CV of the organization's executive director, a former Senate aide and tech industry lobbyist (Ryan Triplette). But not a single company is named that would say it has problems with Microsoft's or Oracle's software licensing terms.

The Register reported on the CFSL's launch, and was told that "customers are concerned about speaking out publicly for fear of 'retaliatory behavior from software providers.'"

That is a serious allegation, but can it be taken seriously? A plausibility check is in order.

Why would any of those companies believe that the targets of their complaint would try to silence critics? And what do they believe would happen?

The Register continues: "Nobody wants the compliance team from Microsoft or Oracle knocking at the door."

Why would that be so much of a concern? If a company meets its obligations under a license agreement, it doesn't have to fear an audit. And even if it had anything to hide, what would the consequences be? Presumably they'd just have to pay the difference between what they reported before and what they were actually using the licensed software for. How is that retaliation by any reasonable standard?

A potential audit is not a reason to hide one's identity. If potential complainants have to be afraid of something, it's that gatekeepers abuse their power such as by rejecting apps or delaying reviews. It didn't prevent me from bringing formal complaints over Apple's and Google's COVID-related app rules. It's not preventing dozens of app makers, large and small, from being publicly listed as members of the Coalition for App Fairness.

I have heard from two major app makers (one very, very large company and a medium-sized European one) that they don't want to publicly complain over Apple's App Store rules. The larger one considers Apple's terms unreasonable, but at least they have dedicated contacts in Apple's App Review department (as did Epic Games until it threw down the gauntlet) that help them get updates reviewed quickly. They don't want to lose that privilege, so they hope others will do the job of bringing about change. The medium-sized one has some rather conservative shareholders who fear that Apple might make their company's products less discoverable. So, it is true that fear of retaliation sometimes does prevent companies from officially complaining. But fear of an audit--in other words, that you might just have to abide by a contract you signed--is not a credible reason, when some other companies even speak out publicly against tyrannical gatekeepers who have the power to arbitrarily prevent you from reaching billions of customers, or to make your life miserable in other ways.

Who is footing the Coalition for Fair Software Licensing's bills?

According to information they published on LinkedIn, they have 11-50 employees. That means a multi-million dollar budget. Where is the money coming from?

I have found two clues. The first one is so ridiculously hypocritical that it actually made me laugh (click on the image to enlarge):

There you have the so-called Computer & Communications Industry Association--which is actually, as I explained in a recent post, a Cash & Carry Industry Association--describing itself as a "longtime advocate for open systems and open networks." That's the same CCIA that supported its most influential member, Google, against the European Commission (fortunately the Commission has already prevailed twice in the EU General Court). It's also the same CCIA that is supporting Apple against Epic Games (the Ninth Circuit will hear Epic's appeal later this week). Presumably that's the #1 reason why Apple joined CCIA about a year ago.

CCIA doesn't give a damn about open systems and open networks or "competitive ideals." It's the enemy of open markets, of open systems, and of open networks. It's just a lobbying front for entrenched monopolists, and in the formal complaints I mentioned further above, three MEPs are accusing CCIA of having astroturfed for Google and Amazon: CCIA lobbied against legislation designed to open up markets and restore competition, and according to the complaints falsely claimed to do so on startups' behalf.

It's my sense of humor when a new lobbying entity springs up somewhere, claims to speak for a certain category of stakeholders it says are too afraid to reveal their identity (without any plausible reason why they'd have to be all that concerned)--and CCIA appears to have a hand in it. It reminds me of that Save Our Standards group that is also backed by CCIA (Despicably deceptive: Big Tech's Save Our Standards campaign presents small app developer as victim of standard-essential patent abuse though it NEVER had to license SEPs). Now all that's missing is ACT | The App(le) Association. But unlike CCIA backers Google and Amazon, Apple isn't in the CSP business.

While Google is not (at least not officially) involved with the CFSL's older European sister CISPE (unlike Amazon), it appears that Google is one of the backers of CFSL. On LinkedIn, Omid Ghaffari-Tabrizi (title: U.S. Federal Civilian Policy - Google Cloud) endorsed and amplified the CFSL's first statement.

Google and Amazon trying to harm the third large CSP, but hiding behind unnamed customers.

That cast of characters says a lot.

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Law firms like Wilmer, Perkins, Ashurst, Van Bael should decline to represent astroturfers after MEPs ask EU Commission to suspend access to EP for representatives of Google, Amazon, Meta, Apple-funded CCIA, other lobbying fronts

There was a time when Big Tech companies and maybe even their outside counsel thought astroturfing--using lobbying fronts that pretend to speak for someone other than who actually funds and controls them--was par for the course. Like an all-year Mardi Gras in lobbying that everyone attends, the only difference being the costumes. Not so anymore:

This is the year astroturfing finally got called out big-time. First on social media, then in mainstream media (Bloomberg exposed ACT | The App(le) Association), now in the political arena, and be forewarned: if some don't distance themselves from that kind of activity now, even prestigious law firms risk court sanctions on top of the utter embarrassment of their clients' amicus briefs and petitions for intervention being rejected.

When a client like Apple or Google comes to a world-class law firm and asks them to represent their sock puppets (to give them more weight in the eyes of the judges), it may not be easy to say no. But the ability to say no is commonly known as a key differentiator between winners from losers. Declining to aid and abet in astroturfing is the smarter choice going forward, provided one carefully reads the writing on the wall. What's been happening lately takes all the fun out of astroturfing. It has become absolutely toxic. And now there are well-funded companies like Epic Games that are not going to take it anymore when their adversaries commit foul play.

ACT | The App(le) Association remains the most shameless astroturfing operation. They even got Apple's lobbying subsidized by the U.S. government's Paycheck Protection Program at the start of the pandemic. And even after they've been exposed, they keep spouting insults to human intelligence. For example, on September 30, the day that the IEEE rejoined the mainstream of the standards development world, ACT issued the following statement attributable to its president:

"We are concerned the resulting legal uncertainty from the IEEE SA BOG action will adversely impact small innovators delivering amazing standards-supporting products." (emphasis added)

ACT's primary backer--Apple--hasn't been a "small innovator" since 1976, the year it was founded (its first computer became a blockbuster the following year). And WiFi (that's the IEEE's most popular standard) or other standard-essential patent (SEP) lawsuits against small innovators are hard to come by. This is just about Apple's notorious efforts to devalue SEPs. ACT falsely claims to represent thousands of app developers, and I've never seen an app developer being sued over WiFi (or cellular) SEPs.

CCIA--the so-called Computer & Communications Industry Association, more appropriately dubbed the Cash & Carry Industry Association-- is now also getting money from Apple, and has been a Google and Amazon front for many years.

CCIA and three of its members (Google, Amazon, Meta) are the most well-known four of the eight entities whose access to the European Parliament is now in jeopardy due to astroturfing. Politico Europe first reported in November 2021 on a Green MEP's concern over fake SME (small and medium-sized enterprise) organizations, and named Google and Amazon's backing of Washington-based Connected Commerce Council. On Friday, Politico EU reported on formal complaints that three well-respected, influential, center-left Members of the European Parliament--Paul Tang (from the Netherlands), René Repasi (Germany), and Christel Schaldemose (Denmark)--submitted to the European Commission. Bloomberg's report on those complaints quotes some of the players--they deny any wrongdoing. TechCrunch published a good summary.

I have meanwhile obtained--but am not authorized to publish the original documents--copies of four of the eight complaints. The complaints were filed with the Secretariat of the Transparency Register, which is a Commission department, "[f]ollowing an exchange with EP President Roberta Metsola" (a Maltese center-right politician).

They allege breaches of rules requiring lobbyists to "identify themselves by [...] the entity or entities they work for or represent; [...] specify the clients or members whom they represent [...]; [and] ensure that the information that they provide upon registration [...] is complete, up-to-date, accurate and not misleading [...]" (emphasis added) ("points a, b and f of the rules and principles as listed in Annex I of the Interinstitutional Agreement of 20 May 2021 between the European Parliament, the Council of the European Union and the European Commission on a mandatory transparency register).

The lawmakers ask the Commission to impose the ultimate sanction by revoking those organizations' access to the EU legislature:

"We ask you to investigate the issue and, upon concluding your remarks, suspend access to the European Parliament for all representatives of the identified organisation and other registrants of the transparency register who were involved." (emphasis added)

A separate complaint had to be filed for each of these targets:

• Big Tech companies:

  • Google

  • Amazon (also see a recent post, Whether Amazon instigates or draws antitrust scrutiny, it's always about avoiding price competition

  • Meta (Facebook)

• Large lobbying groups:

  • CCIA

  • IAB Europe

• Smaller lobbying groups:

  • Connected Commerce Council (3C)

  • Allied for Startups

  • SME Connect

The complaints focused on lobbying related to the EU's Digital Markets Act (DMA) and Digital Services Act (DSA). ACT has also opposed the DMA, but for what I know has not been nearly as active in the European Parliament in the DMA context. They have, however, lobbied MEPs to ask the Commission written questions about SEP policy, and in at least one case those efforts did result in a formal filing of a parliamentary written question. It's just a question of time when ACT will also be held accountable. ACT (like CCIA) regularly testifies in U.S. Congress, and next time ACT does so, politicians who disagree with its positions may very well bring up the Bloomberg story on whom ACT really represents.

It's getting rougher out there for the astroturfers and their backers. They're increasingly being called out, and formal complaints over their conduct have been and will continue to be brought.

Astroturfers will now also face more resistance to their amicus curiae briefs. So far, most litigants have taken a rather permissive approach and opposed amicus briefs only under the most egregious of circumstances. Now, after those mainstream media reports and complaints by lawmakers, it appears probable that questions will be asked and motions for leave will be opposed. For instance, in an Ericsson v. Apple case before the U.S. International Trade Commission, not only Ericsson but also the ITC staff insisted on knowing more about Apple's backing of ACT (the discovery motion was ultimately granted over Apple's objections).

In the United States, lawyers are officers of the court, and some of the same principles also apply in European jurisdictions. They may vigorously represent their clients, but they have to be truthful. Law firms--especially top-notch firms with an otherwise impeccable reputation--should think twice before they submit briefs on behalf of 5,000 small app developers when the net effect is just that Apple gets to exceed page limits and judges may end up believing that there really are small app developers who are concerned about SEPs or who love Apple's App Store tyranny and tax regime.

I don't mean to name and shame them, but I do want to give examples of astroturfing that was supported by otherwise really great firms:

• Philips v. Thales, United States Court of Appeals for the Federal Circuit, case no. 21-2106: October 21, 2021 "Brief for Amicus Curiae ACT | The App Association in Support of Appellant" submitted by one of Apple's go-to firms, Wilmer Cutler Pickering Hale and Dorr LLP (a firm I've often had extremely positive things to say, but it should be beneath WilmerHale to represent astroturfers)

• Continental v. Avanci et al., United States Court of Appeals for the Fifth Circuit, case no. 20-11032: April 20, 2022 "Brief of Amici Curiae ACT | The App Association, Computer and Communication[s] Industry Association, High Tech Inventor[s] Alliance, and Public Interest Patent Law Institute in support of petition for interference en banc" (I haven't mentioned Perkins Coie before, but I know and respect former as well as current Perkins partners)

• Google v. European Commission, Court of Justice of the European Union, case no. T-604/18 ("Google Android"): Google was supported by the Application Developers Alliance (which is Google's fake developer lobby, i.e., Google's ACT, though less visible in the public debate), which was represented by Ashurst lawyers Parr, Vaz, and Baena Zapatero (Ashurst is also representing European soccer body UEFA in the European Superleague Company case and gave some really good answers at the July hearing)

• Intel v. European Commission, Court of Justice of the European Union, case no. C-413/14 P: Intel was supported by ACT, which was represented by Jean-François Bellis of Van Bael & Bellis, whom I called the #1 lawyer when it comes to appealing DG COMP decisions; even his firm's website grossly misrepresents ACT as "a trade association of more than 5,000 IT firms worldwide"

Those four firms honestly may not have known what their clients were really about when they filed those amicus briefs or were presenting them before the EU General Court. But by now we may have reached a point at which they can hardly deny having read what Bloomberg, Politico, and others have revealed. Just say no next time.

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Looking for support against Epic Games, Apple joined CCIA (the so-called Computer & Communications Industry Association--actually, just a Cash & Carry Industry Association) shortly before district court's judgment

"Drain the swamp"--in reference to Washington D.C.--is a bipartisan phrase: it has been used by Republican Presidents Reagan and Trump as well as Democratic Speaker Pelosi. The type of swamp that I am particularly concerned about is a transatlantic one: in D.C. and in Brussels, all sorts of Apple- and Google-funded entities claim to speak for entire industries or industry segments while their only objective is to advance the interests of one or both of those platform monopolists.

Bloomberg deserves credit for its contribution to draining the swamp with the (unsurprising to me, but previously unconfirmed and not obvious to everyone) revelation that ACT | The App Association is actually an Apple Association. Against that backdrop, it's just insane that a deceptive-lobbying front for the world's richest corporation benefited from the U.S. government's Paycheck Protection Program.

On an outrageousness scale from 1 to 10, ACT is clearly a 10 because it untruthfully claims to work for many of the victims of Apple's App Store monopoly abuse.

On the other end of the spectrum, there's the Fair Standards Alliance (based in Brussels, but an active filer of statements in the United States, too). Most of the most active contributors to, and investors in, digital standards would disagree with the FSA on what's really "fair." From their vantage point, the FSA is nothing but a SEP Devaluation Alliance. In internal communications that came to light as a result of its litigation with Qualcomm, Apple--the FSA's largest member--defined the devaluation of SEPs as a strategic objective and is often criticized for it. A correct and nonjudgmental name for the FSA would be Net Licensees' Alliance. Be that as it may, the FSA is clear and consistent about its agenda, and doesn't attempt to mislead anyone into thinking that it speaks for anyone but its members.

Somewhere in the middle between the FSA and ACT | The App(le) Association, there's the so-called Computer & Communications Industry Association (CCIA). That is a misnomer because the CCIA never in its 50-year history tried to build an industry-wide consensus. It was founded as an anti-IBM lobbying initiative, and while I, too, have criticized some of IBM's historical mainframe practices, there was a time when no one could claim to represent the computer industry without having IBM on board. One could even argue that this is still the case. In the late 1990s and early 2000s, CCIA took aim at Microsoft more so than IBM; then (after a settlement with Microsoft) IBM was in the cross-hairs again; subsequently CCIA worked for Google and Samsung against Apple and (former CCIA member) Oracle; and they are now lobbying for Google and Apple on issues on which the mobile platform duopolists are aligned, while simultaneously helping Amazon and Google against (former CCIA member) Microsoft, their most important competitor in the cloud services business.

The time has come to call CCIA out. It's simply a Cash & Carry Industry Association: sell it and they will come. Think of a family visit to a mall, where a given family member visits only one shop while there may be shops that are of interest to two or more family members. At least they all agree that it's convenient to have a nearby mall.

In 2010 I had a conversation with an IBM lobbyist (whose name I've forgotten) at an OpenForum Europe event where the EU's then-antitrust chief Neelie Kroes delivered a keynote address. CCIA was supporting its (temporary) member TurboHercules against IBM, and the IBMer told me this (I don't recall the exact words anymore, but it was very close):

"We don't like organizations that operate like CCIA where everyone who pays gets to use the entity for some purpose."

The man had a point. And nothing has changed about that.

Actually, since 2010 CCIA's flip-flopping has become even more apparent; the cycles have become ever shorter; and CCIA is now working against the interests of the vast majority of technology companies, including various of CCIA's members, some of whom may be too shy (or incompetent) to formally dissent from the organization's views while others may have exactly the attitude that the IBMer criticized: there's something for everyone, like a cash & carry market.

Take standard-essential patents (SEPs). In the entire history of wireless standards, there have only been two reasons for which SEP holders seek injunctions against implementers. One is because of a disagreement on royalties, whic his the normal course of business in patent licensing; the other, however, was really problematic: Google's temporary subsidiary Motorola Mobility (against Apple and Microsoft) and Google's long-standing hardware partner Samsung (only against Apple) were seeking SEP injunctions to force other parties to give up their intellectual property in the form of a zero-zero cross-license. Through Motorola, Google even wanted to put so much pressure on Apple that no Android device maker would ever have been sued again over slide to unlock, rubber-banding, and similar Apple non-SEPs.

The royalties that Motorola and Samsung demanded were prohibitive. For instance, Motorola's initial offer to Microsoft amounted to more than it gets from computer makers for a Windows license in many cases (as Motorola wanted 2.25% of the price of the actual device, which it even explained in writing). That's not the case now with Ericsson and Apple, for example.

That type of abuse was a fundamental threat to the computer and communications industry. But there was deafening silence from the Cash & Carry Industry Association: Google, which had joined in the mid-2000s, was its dominant member at the time, and Samsung joined during that period. (Despite everything else, I commend CCIA for some brilliant write-ups on the design patents damages dispute between Apple and Samsung; their author has since left.)

After the Android patent disputes had settled out for the most part, Google and Samsung were more interested in bringing down SEP royalties. That's why CCIA then, all of a sudden, described SEP abuse as one of the biggest perils of the technology sector and filed amicus curiae briefs and public interest statements in various cases, including the Qualcomm-Apple dispute, though Apple hadn't joined yet. (The fact that Qualcomm never was a CCIA member also reduces to absurdity the organization's claim to speak for the computer & communications industry.)

"Open Markets, Open Systems, Open Networks -- Full, Fair and Open Competition." But CCIA members' walled gardens are fine...

When campaigning against IBM and Microsoft and then again IBM, CCIA's mission statement was the one I just quoted. In retrospect, even if one disagreed with some of IBM's and Microsoft's terms and policies of way back when, whatever they may have done was nothing compared to what the Goopple duopoly is doing now.

IBM didn't even attempt to monopolize the PC: presumably because of its mainframe antitrust experience, it made it an open architecture--a lot more open than the Mac ever was, and the Mac is actually pretty open compared to the iPhone.

Microsoft at some point decided to settle with the European Commission and to cooperate with competition regulators in general. By contrast, Apple and Google exhaust all appeals and are not even deterred by non-compliance fines (just chump change for them).

Just like CCIA didn't speak out against SEP abuse when there really were serious issues, CCIA has now thrown its whole "Open Markets, Open Systems, Open Networks" and "Full, Fair, and Open Competition" mantra overboard. Now that advocates of open markets and fair competition are really needed, CCIA is not merely silent: it even opposes regulation and legislation that could open today's most strategically important markets.

Why? Money from Mountain View. Plain and simple.

CCIA even intervened as a supporter of Google's appeal against the European Commission's Google Android ruling. What else do I have to say? The few supporters that Google had against DG COMP were all paid by, or dependent upon, Google, such as HMD (of which Google is a major shareholder). Fortunately, the EU General Court was not going to be gaslighted: it materially affirmed the Commission decision, and perfectly understood that the two major mobile platforms don't compete with each other in the app distribution aftermarket.

Apple saw CCIA's efforts to defend Google's monopoly abuse, and apparently some people in Cupertino asked themselves: why don't we, too, put some coins into that jukebox called CCIA?

After the Epic Games v. Apple trial, no one knew for sure how the district court would rule, but one thing was a given: that the losing party would appeal. Apple knew that it would soon need allies who would file amicus curiae briefs with the United States Court of Appeals for the Ninth Circuit (yesterday I published another post on that case as the appellate hearing will be held this month).

Apple already had some entities and individuals in its pocket, but may have anticipated that Epic would (as it did) get a lot more support. In fact, Epic even has the Biden Administration and three dozen U.S. states on its side.

It was in early September 2021--roughly a week before the district court's decision--that Apple was first listed on CCIA's website as a member. Normally you would expect an "industry association" to welcome the industry's largest player with a press release (and possibly even throw a party). But that's not CCIA's modus operandi. It does frequently update its published member directory, and I save snapshots from time to time as part of my research. CCIA's members join as silently as they leave (Microsoft was the only exception because of a settlement that they just had to announce).

The first favor CCIA has done Apple since was an amicus curiae brief in the Epic case. CCIA was in bad company as ACT also made a submission. But that is nowadays pretty common. CCIA and ACT also cooperate on the alarmist "Save Our Standards" campaign, which I called out on making false claims about SEP issues allegedly facing small app developers (Despicably deceptive: Big Tech's Save Our Standards campaign presents small app developer as victim of standard-essential patent abuse though it NEVER had to license SEPs).

Of course, Apple is also aligned with CCIA on SEP devaluation. But when Apple joined CCIA, it had no shortage of lobbying fronts on SEP issues: ACT, FSA, and HTIA--to name but a few. What Apple really needed was another ally against Epic.

Interestingly, CCIA--unlike ACT--did not even file a public interest statement in response to the USITC's request for such submissions after Ericsson's three complaints against Apple earlier this year. I do, however, anticipate that CCIA will make filings at a later stage of that dispute. CCIA's three most recent submissions to the ITC supported Google against Sonos (December 2, 2021); Apple, Samsung, and other smartphone makers against Arigna (February 28, 2022); and Apple against AliveCor (July 27, 2022).

Apple doesn't really have allies in the tech industry. There are some mutual interests with Google, but even Google is campaigning (unsuccessfully) against Apple's walled garden with respect to instant messaging. CCIA will remain silent on that one for sure. Apple does have a lot of money, though, and even claims that because it's so profitable, no import ban should issue on its products even if found to infringe Ericsson's patents.

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