A post on the NY Times’ “Bits” blog describes the trevails of a developer who went to the trouble to build an iPhone podcasting application only to have the application rejected because it duplicates functionality found in iTunes (which is to say, the developer’s product is competitive with Apple’s own software).
This violates our first rule of platforms (“A ‘proprietary platform’ isn’t a platform”). Put another way, if you have to ask permission to develop a piece of software on a platform, that platform isn’t open — it isn’t even a platform (it’s a walled garden or a collection of integration points). If you attempt to build a business on such a product, you run the risk that the company that owns the product can destroy your business at any time, for essentially any reason. You are, in essence, a sharecropper.
The amount of revenue that Apple will lose from a third-party podcasting application is zero. The number of developers who will think twice about developing for the iPhone because of these capricious policies is almost certainly more significant.
Update: It’ll be interesting to see if Apple relaxes their rules in response to today’s release of the Android Market, the open application store for the new Android phone.