Apple has banned at least two prominent iPhone hackers from accessing its App Store. Sherif Hashim, an iPhone developer who developed a hack for the latest iPhone OS 3.1.3, and iH8Sn0w, who developed the XEMN tool designed to unlock iPhone 3.1.3 radio baseband for the 3G and 3GS, found that their Apple IDs were blocked and …
Pathetic control freakery by apple
I think this is pretty pathetic move by apple. They complained about MS being restrictive but apple look to be even worse. I was considering getting an iphone later in the year but am sick of apple lock downs so think I will sell my touch and get a 32GB Micro SD card for my XDA instead. I just wish there was a good smartphone OS that didnt force you into working the company way as from what I hear about android its just the same.
... get a Nokia N900 and be happy!
I have one!
is pretty awesome !!
but i had to go for the touch pro2, I wanted a keyboard.
just wish i had that sexy 1ghz chip on board !!!!
Almost a "thumbs up"
I was about to "thumbs up" this post until the last sentence. Android does at least allow you to install software from other sources without rooting/jailbreaking the phone. I've done it once, used ADB to install from my desktop which was pretty painless and the app is very useful.
Depends if you don't mind the Creepy Google data monitoring instead of the Apple control freakery. For me, the former is the lesser evil for now and I'm not too worried as I just ignore any ads, but it is a concern.
Apart from that I agree with everything else you said :)
You are missing the point
Spoken with the voice of the leopard seal from Happy Feet: "I know where you live".
Hackers about to cross the line?
"Developers smart enough to figure out how to unlock iPhones are unlikely to be inconvenienced for too long by a ban on their current Apple IDs."
But if they've been banned then presumably getting themselves another account and using it is an unauthorised access onto Apple's servers and unambiguously illegal - or is it cute that I think so or think that it's significant?
Keep this in mind
It;s not Apple on their own. There are clauses in the carrier contract requiring Apple, to the best of their ability, to stop people from interfering with the operation of the device on their networks. Lets point a little blame where blame is due; at the carriers for forcing locked devices in the first place and draconian militant policies on the device manufacturers, and on the media providers who won't allow their wares in online stores without proprietary, non-portable DRM.
Don't blame the carriers ...
... being locked to a Network is fair enough given that most of the time the operators have subsidised your handset and now want to get their subsidy back in terms of your usage of THEIR network. Fair enough. I doubt they care about the apps too much unless they may be VOIP ;-)
Subsidy loan isn't ownership
Yes the carriers subsidise the price of the hardware, but in all the (admittadly European) countries where I've seen this done, they claw their money back (and some!) by a minimum term contract with minimum fee per month.
You sign the contract and you pay them the money. The hardware belongs to you. It would be different if they gave you the hardware with no further obligations to pay them money.
Nice try but no cigar for the fanboi.
Not always true, in the UK Voda and O2 don't lock contract phones unless it's the jeebus phone.
Make of that what you will but the iPhone being, AFAIK, the only locked contract phone from Voda and O2 speaks volumes to me. Draconian militant policy perhaps but I doubt that it's the carrier to blame.
Given Apple's almost Orwellian control freakery over the past few years I suspect I know where a good portion of the blame lies.
'media providers who won't allow their wares in online stores without proprietary, non-portable DRM'
that's bullshit, if iTunes is largely DRM free I don't see how you can blame anyone apart from Apple if the iPhone is locked down tighter than a nun's crotch at lent or are you calling Apple liars for trumpeting the DRM free nature of their online store?
Either way the fail is Apple's, you choose.
Naughty, Silly Apple.
Apple won't win with this tactic. As your journalist rightly pointed out.
Yes the N900 is pretty but the "basic features missing list" is as long as your arm. They spent too much time getting the thing to plug into a TV so you watch it on a huge screen (Which is awesome, I ripped a DVD and watched it from the phone on my TV and it looked better than the digital signal I get, or the iPlayers offerings.) but don't expect notifications of an SMS arrival, or MMS to work at all, the media player is a clone of the windows one, with little thought to playlists or structuring of files. To name but a few.
It'll improve and what you get out the box is still better than the iPhone in spades. (Apart the ovi store that counts short videos as real apps and has about 160 in total) I would suggest to most people to read through this lot before they invest. :)
I know OVI has a lack of apps, but it's not an iPhone, you *can* get your apps from anywhere!
I wonder if anyone can name 160 useful apps... I don't even have that many on my PCs.
Most apps seems to be little more than a thin wrapper round a website, so as long as you've got a good browser, what's the problem?
You can do that on the iPhone :)
I wonder if...
...they WERE trying some kind of funny business against the App Store.
That's a bit harsh..
I don't get the constant harping on apple's app store.. I mean fair enough that the policies for getting apps out there are kind of vague, unless you jailbreak (which they just don't support, not block or prosecute as some people seem to think), but it is a fairly volumous app store, with plenty of them free. It'll be no better with this amalgomated app store, and even worse with a google one (you want to see control on a phone, try one which is powered by a company that controls the internet).
But to be honest, blocking a couple of known, admitted and publicized hackers from their registered ID's on the app store is perfectly reasonable. That's like saying two known offenders or shop lifters walk into a local store, and are asked to leave, then get black listed. ANY company reserves the right to refuse sale of products or enterance to their facilities, and apple is by no means any more in the wrong here.
That being said, as someone who has jailbroken, unlocked and modded many phones and laptops in my time, I think it's great work these guys are doing, but you can't expect things like this not to happen when you've got a very easy to find and outspoken blog about the 101 ways to hijack your phone away from it's propriatary pilot.
Was just thinking about this...
"But to be honest, blocking a couple of known, admitted and publicized hackers from their registered ID's on the app store is perfectly reasonable. That's like saying two known offenders or shop lifters walk into a local store, and are asked to leave, then get black listed. ANY company reserves the right to refuse sale of products or enterance to their facilities, and apple is by no means any more in the wrong here."
I just had an (off-topic) thought when I read this: if a shoplifter gets blacklisted and can't go into shops, how does he buy things like food?
... he uses a home-delivery service. Like Tesco, Ocado or any of the umpteen alternatives. As long as he has a card to pay with, they'll happily truck it over to him.
(Or he could go old-school and simply get someone else to buy his groceries for him. It's not a difficult concept.)
I WANT a phone "which is powered by a company that controls the internet"! Which company controls the Internet, again? Seriously ... do you know of one? And please provide links to explain exactly how they "control the Internet", because that's one pretty amazing company. Even the Chinese government can't "control the Internet", so if you've got some info on a company that can do it, I definitely want a piece of that action.
Or were you lazily referring to the far less capable, far more boring "use us if you want to" Google?
Food for thought?
To an Apple iPhone developer, being blocked from Apple is like not being allowed to buy food. OK no quite so bad but getting that way.
Computers are such a fundermental part of peoples lives that rules which a large company emposes have a far greater effect than say a publican banning a drinker from his particular pub.
As another poster pointed out, this ban could lead to the developer actually breaking the law to gain access to the tools of his perfectly legal trade.
The general public can be hearded and managed by skillfull companies for profit. Locking mobile phones is one of the tools. It's only fair and natural that some of us would like to go a different way.
Why is the US DoJ & the EU AC not prosecuting Apple?
I am not a fan of Microsoft, but...Both the US Department of Justice and the European Union AntiTrust Commission went after Microsoft for much less, mainly for requiring all PC's shipped with Windows to have a shortcut on the desktop to Internet Explorer. Microsoft never tried to be even 1% monopolistic as Apple, in that Microsoft never tried to dictate that all software run on Windows PC had to be purchased directly from Microsoft. Even Microsoft understands that the user owns the hardware. Why are the US Department of Justice and the European Union AntiTrust Commission neglecting their duties when it comes to Apple's monopolistic behavior?
First you get the power...
Trouble being that you can behave like a monopoly all you want provided you are not a monopoly.
Given the quality of design and execution that Apple produces often means that their devices are often the most coveted in any given market, but with the exception of the iPod, Apple doesn't dominate in terms of sales... just hype. The monopoly on desktop operating systems that Microsoft holds (the better part of 30 odd years on) was gained so rapidly and near totally that IBM was brought to it's knees. So big was the monopoly that at some point I'm sure that a name change to Mircosoftopoly was seriously entertained by Waddingtons.
"Microsoft never tried to be even 1% monopolistic as Apple..."
Is not unlike comparing gangsters and gangstaz, in that the behavior of each fails to impress anyone, but I don't think that Microsoft's unswerving devotion to their old mum back in the barrow negates the fact that they are a massive organisation with a long and historical criminal record.
That old chestnut again
Before labelling something a "monopoly", please take the trouble to understand what it means in that context. It does *not* mean being a control freak with your users. It does *not* mean shunning interoperability or other standards.
Being a "monopoly" primarily means that the size or influence of your company within the marketplace is such that you can crush or exclude all competition, thus harming the marketplace as a whole.
Microsoft is a monopoly and has been found guilty of abusing their position. And they could easily do so again. Make no mistake - Microsoft is a formidable presence in the marketplace, and could easily crush all competition without regulation. And not through providing the best products or services, but simply excluding (unfair business deals), undermining (giving away a products that are the life-blood of another company), and isolating (by ignoring or contaminating standards). that's why the US DoJ and the EU watch their every move so closely.
Apple is nowhere near being a monopoly. The market is such that if you don't like Apple, there are plenty of other companies you can purchase from. Note all the replies to this post saying, "don't buy Apple, buy such-and-such instead"
in all fairness
Microsoft became a monopoly, not through any dodgy market tactics, but purely through having no competition whatsoever! In the 90's, you had windows, or , well, windows* to choose from. so Microsoft had 10+ year of no competition!
Apple can hardly complain now, as they specifically made the choice not so support the majority platform at the time, and become a niche supplier.
*does os/2 count? i remember the adverts, but no-one i know took it seriously.
Riscos (exceptional as it was, certainly compared to windows), amiga workbench etc were hardware specific, not ibm pc, so they couldn't be used.
Oooh, please enlighten me as to where else I can buy apps for my jeebus phone if Apple aren't a monopoly supplier for that marketplace.
Microsoft are a charitable company, they've bailed out at least one almost disastrously failing competitor that I can think of.
Re: in all fairness
Sooty: "Microsoft became a monopoly, not through any dodgy market tactics, but purely through having no competition whatsoever! In the 90's, you had windows, or , well, windows* to choose from. so Microsoft had 10+ year of no competition!"
IIRC Apple were making computers in the 90's. Or do Macs not count as 'real' computers?
Too poor, not shiny enough
Singapore is better comparison.
Lol, Kim Il Jobs...
And the explosion? That'd be the LiIon batteries.
Apple isn't prosecuted for monopoly abuses because it isn't a monopoly
There are several other smartphone brands with a respectable share of the market. Apple doesn't have a monopoly, and any selfish acts on behalf of itself or its business partners - phone service companies - are not monopoly acts.
Re: Apple isn't prosecuted for monopoly abuses because it isn't a monopoly
monopoly (n) :
1. A situation, by legal privilege or other agreement, in which solely one party (company, cartel etc.) exclusively provides a particular product or service, dominating that market and generally exerting powerful control over it.
2. An exclusive control over the trade or production of a commodity or service trough exclusive possession.
Now, try selling an app to iPhone owners without going through Apple... That's right, you cant.
Is that clear enough for you? Or do you need someone to draw you a diagram?
Re: Apple isn't prosecuted for monopoly abuses because it isn't a monopoly
Exactly! Apple is controlling a market sector and not the market itself, therefore it has more freedom to do stuff like this in the smartphone market than Microsoft can in the desktop OS market.
Re: Apple isn't prosecuted for monopoly abuses because it isn't a monopoly
"product or service, dominating that market"
You FAIL, I'm afraid.
The iPhone doesn't dominate the market - not by a long shot!
1. What is the market in this case? Is it the mobile phone market? (Apple has something like <5% of this), which is dominated by Nokia? Or is it the smartphone market, which is probably dominated by RIM/Nokia (depending on your definition)
Or is it the application market for smartphones, again, probably dominated by Symbian simply due to it's age. (there's thousands of symbian apps out there.)
Or to put it bluntly, there's lots of different smartphones out there, you're free to pick and choose.
2. Again, they're not the exclusive producer of phones or small handheld computational devices.
"Now, try selling an app to iPhone owners without going through Apple... That's right, you cant."
Yes you can: http://cydia.saurik.com/store/
Surely this situation is more like Ford with spare parts for their cars, there's nothing stopping you from fitting aftermarket parts (ie, by jailbreaking, which has been pointed out isn't approved but is also not illegal.), but then it's up to the manufacturer weather they continue to support you after you've done this, most wont.
I understand why people get annoyed at the app store (although lots of people seem far too annoyed, what is it you want to do that there's not an app to do and only the iPhone is capable of??) but it's not a monopolistic situation, and to compare it with the MS situation in the 90s (where it was virtually impossible to buy a computer without windows unless you built it yourself... oh, and it still is.) is just ludicrous.
PS, I would love to see the picture...
Try buying a new car with a Nokia dock, or a Symbian dock
You'll have to pay for that iPod dock whether you own an iPod or not.
Apple has a monopoly on that interface device, and they have a large enough market share that everyone from car makers to DVD makers to alarm clock makers are willing to pay a small royalty to install the dock in their device.
Apple has done an outstanding job of creating this "virtuous circle", but it is far more insidious than Microsoft's grip ever was on the desktop. If you have even a sneaking regard for the value of Open Standards, and their power to make things better for everyone, this should concern you.
Because there isn't such a thing.
Or am I missing the universal 'connect devices to stuff' dock? Or maybe you mean a 3.5mm jack plug (for audio), which many cars/stereos support.
Or bluetooth for the phone?
I'll agree that a universal standard for this kind of thing would be a good idea, but there isn't one. USB comes close, but then again my phone has a proprietary connector on it so I have to use a special lead..... (nokia)
Mind you, I think you're confusing 'devices that work with the ipod' with 'devices'. My recently bought clock radio doesn't have a dock connector, and even a cursory glance through Amazon will show that the devices fitted with ipod docks make up a relatively small section of the market, so manufacturers are hardly /forced/ to adopt it. (Many things simply have USB connections for example.) There is also more than one type of dock connector.
What vicious circle is this anyway? The vicious circle that was caused by Apple releasing an expensive media player into a crowded market that was so poor and did so little of what people wanted from a PMP so badly that it took a good percentage of the market? I've said it before, if you don't like it don't buy apple, there are many many other choices.
The grip Microsoft exerted (as they seem forever to be compared to each other despite being quite different arguments) was an almost total control over the desktop OS market, which they were poised to use to increase this to an almost total control of your pc (Office suite or nothing.) and was demonstrably harming innovation in the PC market.
"If you have even a sneaking regard for the value of Open Standards, and their power to make things better for everyone, this should concern you."
I don't understand 'make things better for everyone', by most accounts the iPod is one of the best media players out there, and the iPhone was released with a lack of many features considered by most to be important (MMS, 3G) and yet offered a good enough user experience that people paid a premium for them in their millions, which would suggest that maybe it is in some way better. (Looking at how it's become the 'device to beat' even though it only has a <5% market share should tell you something here.)
Or do you mean on some more idealistic level? In that case I'm not quite sure criticising a consumer electronics company is entirely productive what with all that starvation and death in the world.
Assuming you do mean in the IT field, what about the other things they do, for example the grand central dispatcher stuff, which is a fairly decent stab at addressing the problem of writing highly concurrent apps that best utilise multiple CPUs, as I understand it their implementation is open source, and the language extensions they propose have been submitted back to the relavent standards bodies? Doesn't that sound like they're trying to 'make things better for everyone'.
Or the mini display port connector they invented?
At the end of they day though, they are a big evil corporation (by definition, most big companies are), but they aren't (yet) a monopolist.
What was that winning phrase from last week?
Oh yes; Twatblanketry! Stike Vomit's rant is a perfect example of this phenomenon!
Because you are so obviously clueless and even though others will have pointed out your utter misunderstanding of words; I'll join in the mêlée, just for kickers...
"1. A situation, by legal privilege or other agreement, in which solely one party (company, cartel etc.) exclusively provides a particular product or service, dominating that market and generally exerting powerful control over it." That would describe the Royal Mail's monopoly over the delivery of parcel or letters. It normally mandated by a government. Us adults call it a "de jure" monopoly. At this I'd like to point out that being a monopoly OF ANY KIND isn't in fact illegal.
"2. An exclusive control over the trade or production of a commodity or service trough exclusive possession." Meaningless bollocks. Again it's not illegal for a business or individual to be in this position.
"Now, try selling an app to iPhone owners without going through Apple... That's right, you cant." WHAT IS YOUR POINT (both pertaining to this and existentially)!?! Before I carry on, you can't (notice the apostrophe) use the word "cant" like that. It's a verb meaning sanctimonious; there are other meanings, but I'll let you refer to wikitionary (dear me) to find the other meanings. What Apple are doing is't illegal. They pay some very clever men and women (we call the lawyers) lots and lots of money to make sure that Apple operate within the confines of the law. Sometimes they'll find loop-holes and even see how far they can bend the law in Apples favour. This behaviour isn't exclusive to Apple; EVERY successful business does it. What you are actually trying to say is that Apple *abuses* its position. It doesn't. It sells products that are powered by a platform (OS) that is able to run 3rd party apps. It is also provides a store front (one has been able to purchase apps of sort from Apple BEFORE iPhone OS was released; they sold games and other add ons for the iPod via the iTunes store) that sell the app's exclusively. This business model is illegal. It isn't even unusual. You are just a troll. Grow the fuck up.
Re: Apple isn't prosecuted for monopoly abuses because it isn't a monopoly
A <6% share of the "personal computer" market is not a monopoly. Saying Apple is a monopoly is like saying Nintendo has a monopoly on the Wii. If you don't like the iPhone, there's several other smartphones out there you can use. What? They are all crap? Then get an iPhone and live with the manufacturer's restrictions. It's called Vendor Lock-in. Get used to it.
A monopoly is only a monopoly if there are no other choices to be had.
Simply Not True
"You'll have to pay for that iPod dock whether you own an iPod or not"
Um ... pick a car to buy without an "iPod dock"?
Or, tell the dealer you want the car but refuse to pay for the "iPod dock", and have them remove it and charge you less for the vehicle?
Either will work. Really.
The only monopoly Apple has is a mindshare monopoly. It's not as if there's no physical choice of what brand you buy into.
You can't sue someone for being perceived as "cool" by a certain demographic.
"1. A situation, by legal privilege or other agreement, in which solely one party (company, cartel etc.) exclusively provides a particular product or service, dominating that market and generally exerting powerful control over it."
You better not go to Marks & Spencer if you want non-M&S branded food then.
"2. An exclusive control over the trade or production of a commodity or service trough exclusive possession."
Do you ever leave the house? What do you think a "shop" is? It's a place where someone (the shop owner) sells only what they want to sell. They don't let people come in off the street and set up a market stall in Hamleys or Tesco, so what was your point again? Maybe you should draw a diagram.
Good luck with that.
Microsoft desktop monopoly
Microsoft does monopolise the PC desktop and has tried to with PDAs and phones.
Anyone can write and sell programs for Windows but it's very hard to sell an alternative operating system for PCs.
I would say it's nearly impossible to sell an alternative OS for the iPhone since that's the whole point in buying one. By design Apple has also made it impossible to sell to the iPhone application market without going through Apple.
The reason why the iPhones are more popular than the Windows PDAs is really just that they are much better. Had Microsoft done a better job with the OS for the PDAs and had those devices had more CPU power then I expect Microsoft would dominate there.
I would have preferred Windows to be the leader on small hand held thingies because it's much more open to hackers and developers, or at least is on the PC.
I think hope is to be found in the far eastern clone makers who tend to stick Linux on all their gadgets. They know that if they build some nice hardware and leave it open, that developers will provide all the software aanyone could imagine.
Meet Mr Cluebat...
The iPhone apps market is a billion dollar a year market - I’m NOT talking about other smartphones or app stores. FFS, is that really so hard to grasp?
Not only does Apple have 100% control over who and what gets to enter their app market, they will also take a large chunk of any revenue made by the participants in the market.
@ Adam T: Have YOU ever been to the high street? Did you notice that there are in fact *other* shops apart from the Apple Store? If you own an iPhone (a non-jailbroken iPhone, for you pedantic twats) the Apple Store is the ONLY one you are allowed to enter.
As for the diagram - I’ve drawn an arsehole with “iPhone owner” tattooed around it, which being royally shafted by a large knob with an Apple logo on it.
Maybe all that Apple spooge has backed-up into your brains and is affecting your cognitive abilities?
Re: What was that winning phrase from last week?
Re: Apple's business practices, 'A_User' wrote: "...This business model is illegal.."
I'm glad you agree with me, but what was with all that other shit you wrote?
Re: Meet Mr Cluebat
"As for the diagram - I’ve drawn an arsehole with “iPhone owner” tattooed around it, which being royally shafted by a large knob with an Apple logo on it."
Suddenly it's all clear! You're a crusader!
Look it's pretty simple: Apple have their market, Nokia has theirs, So-and-so has there's, and so forth. Some let you do what you want, some don't. You can get some in blue, and some you can only get in black.
If you don't like apples, eat something else. Yeah I know, twat thing to say blah blah blah, but that's life: Get over it.
Why not just COMPROMISE...
If I were Apple, I'd really re-think their current stance and model. They could really aid the growth of the platform whilst restricting piracy by taking a different stance here. One possibility:
1. Keep the current AppStore as is - the standard one that's installed on the iPhone, with the approvals process they want, and so on.
2. HOWEVER, don't stop third party applications from being installed on the iPhone via other means. DO make any vendors of these get a unique application ID for each app from Apple, though (much as Psion used to do for EPOC [Symbian] development). Have some decent security around these unique IDs such that anybody trying to pirate a "genuine" app and re-install it via other means on another device can have a look up against that ID, find no license purchased, and the app is killed. This would have to be built from the ground up in the OS to support this, attempts at fake app-launchers that mask IDs killed, etc, naturally. Hell, null-and-void the warranty if these "alternative" apps are installed. Use the same app-killing functionality to revoke licence IDs for ones that really do break any Ts & Cs (e.g. network unlocking or security-bypass apps)
Just allow MANY more types of applications to be approved in the AppStore. The only reason I went down the Jailbreak route: Wanting to have an icon on the statusbar for missed calls/texts/unread emails, and the ability to stop the lock screen from showing who's sent me a text message. Basic features that should be in the OS, frankly. Throw in backgrounding of tasks, allowing "legal" emulation/code execution once the AppStore has got to critical mass and that's not likely to be eroded (which I'd say it has already), and you've just won a whole load more friends through Flash, SCUMM, etc.
As it stands, they're just limiting their potential market - and that's not good for developers, customers, or shareholders in the long term. I'll be considering Android and WiPh7Sr (or whatever abbreviation of it the world settles on) when the contract's up on my 3GS: as much as I love the functionality it has today... I'm very fearful that it won't be long before the things that make it a functional device will be pulled from under me. If I couldn't have jailbroken it, I'd never have bought it. I've put a lot of money the AppStore's way since that purchase, and I know I'm not the only one with a jailbroken device that's in the same situation. Hell, I've even paid for apps on the Rock alternative store.
Long term, I see the iPhone's market share getting eroded as more open platforms deliver the same or better user experience, hardware quality, and so on but without the hurdles to jump for a lot of the "enthusiast" owners who drive a lot of additional sales. And that's kind of a shame, as it really is a lovely device (note I say "device", rather than "phone"!) ...and this is coming from somebody that was already publishing software for EPOC (Symbian) over a decade ago back when it was actually impressive on the Psion...
Where's the problem?
All Jailbroken iPhones I've seen have a gazzilion apps, none of them paid for. If I was Jobs, I'd brick jailbroken iPhones.
After all, you don't *have* to buy one, do you?
According to this thread, there are many better phones out there. I doubt it very much, but you're entitled to your opinon :)
"All Jailbroken iPhones I've seen have a gazzilion apps, none of them paid for."
Nice, you're implying that they pirate software from the apple store when they're actually putting on software that apple refused to allow in their store. Puts a very different light on things, I reckon.
Yes, they may have gazillions of apps that weren't paid for. I didn't pay for the OS running on my computer, or any of the apps running on the OS. Reg readers can presumably guess why. Does that make be a bad person?
The problem is throughout...
I won't deny that a *lot* of the jailbroken iPhones that you see are loaded up to the hilt with "unpaid for" applications. But measuring the impact of jailbreaking on this alone avoids a lot of the implications:
1. Yes, there may be some lost revenue in application sales. But the kind of people who are going to hack their iPhone purely to get free applications are very unlikely to have bought the applications anyway. All the "lost sales" and "stolen money" that is crowed about are generally very unrealistic figures. Having run a mobile software publishing business (consumer applications and games, so directly comparable) for well over a decade, the losses here are actually pretty minimal from every remotely realistic measure I've ever seen. From Apple's perspective, there's a fair chance they'd have lost the sale if the possibility of pirated software wasn't there for that individual, rather than them actively purchasing such applications. I think if even more of the applications moved to a freemium model or had trial/lite versions, the reality here would be even clearer once the benefit of "try before you buy" was factored out... especially given the amount of dross that is released and needs sifting through in the AppStore.
2. There is a small percentage of people who will download a pirated application, then go on to pay for it. Admittedly, this is a very small number of people, but it's certainly greater than zero. If you look at the REALLY long tail, that number rises - a number of the current iPhone games are ports of "classics". I know of quite a few people who pirated the original "back in the day" on the likes of the Amiga, and are now paying for the games on the iPhone as payback as much as nostalgia
3. Many of the people who jailbreak their iPhone are of the more technical variety. The kind of people who are often turned to by their acquaintances for which handset to purchase. I.e. one jailbroken handset sold to such a person could net several more unmolested handset sales. Which then drives more application sales. Conversely, if these people switch to an alternate platform, that's a number of potential sales and recurring revenue lost.
4. Just because somebody's iPhone is jailbroken doesn't mean that they don't also pay for AppStore apps. There *are* revenues from the AppStore from die-hard jailbreakers who would not have purchased a device if it could not have been jailbroken.
5. Many of the applications for sale on "alternative" application stores (e.g. Rock) are commercial. Some of them even with fairly high pricetags relative to normal applications. Take iBlacklist for example - a lot of what it offers should have been built in to the iPhone, it does nothing religiously offensive to the Church of Steve, and it costs a fair chunk of cash for such an app ($11.99, from memory). And these applications do earn revenue. I.e. jailbreaking REALLY isn't entirely about a free lunch. A more inclusive approach to the AppStore and a more open marketplace would see these apps both sell more, and Apple take more of the revenue. Well, unless an alternative AppStore started syphoning sales away from them with the promise of lower commission to developers...
6. A lot of future premium development - especially on "smaller" platforms comes from the early steps of a developer in a more homebrew nature. Being able to write your own iPhone apps and deploy them to your personal device without having to publish them via the AppStore helps build a long-term developer community, rather than set a bar to entry.
If they opened the model up more, they could come down a lot harder on those that flout the rules and play outside a fairer system... and gain more customers, more revenues, more of a developer community, and more support from the blogosphere in the process.