Lock-in: making your product hard to leave, and knowing how hard to press

The emails about a text bubble

In April 2013 Apple's senior executives argued by email about whether to put iMessage, the iPhone's messaging app, on Android phones. Eddy Cue wanted to do it as a full project.

Craig Federighi objected. Bringing iMessage to Android, he wrote, would do one thing above all.

“would simply serve to remove an obstacle to iPhone families giving their kids Android phones”Craig Federighi, in Apple emails made public in Epic v. Apple

Phil Schiller agreed that "moving iMessage to Android will hurt us more than help us." iMessage stayed on Apple's own devices.

Nobody pays for iMessage. What it protects is the rest of the relationship. In fiscal 2024 Apple's services, the App Store, iCloud, Apple Music and the rest, brought in $96.2 billion at a 73.9% gross margin, against 37.2% on the hardware.

That is lock-in: a product that costs nothing to use and a great deal to leave. The decision is rarely whether to build it. Most of the companies in this guide already had it. The decision is how hard to lean on it, and that is where they run into someone other than the customer.

What lock-in is

Some lock-in comes free with any product people use for years. Deliberate lock-in is designed: a marketplace of apps that run in one place, a certificate that only one employer values, a repair that only the dealer can authorize. The cost of leaving is often paid by someone other than the person who signs the contract, which is what makes it so strong.

Why it is so hard

Lock-in works. That is what makes the decision hard: the pressure to press harder never lets up, and the limits are not where the economics say they are.

The ways companies did it

The decisions on record take five shapes. Each makes leaving costly in a different place.

What 15 companies did

Here is every decision on record, placed by the year it was made and marked by how it turned out. Hover a mark, or open the table, for the company and the outcome.

Of the 14 decisions that can be judged, 12 were never undone, 0 were reversed and 2 were kept only in part. The partial ones are Microsoft's Teams bundle and Deere's repair lock. In both, the customers never broke the lock-in. A competition authority, a state legislature and the courts did.

Remember what "never undone" means here. Intuit joined the IRS Free File program in 2003, offering a free tier in exchange for the IRS agreeing not to build its own competing service. That arrangement held. Along the way the FTC found Intuit's "free" advertising deceptive, and Intuit paid $141 million to settle with all 50 states.

Shopify's 2025 change to its developer fees is recorded here as held, and under The Flywheel as too early to judge.

How to run this decision

If you are weighing a version of this choice, here is what the record suggests doing, in order.

1. Find out who actually pays the cost of leaving

   Not the account, the person. Salesforce's lock-in sits with administrators whose certificates do not travel. Apple's sits with a family's group chats. If the cost lands on the person who signs the renewal, it is a negotiating position, and it will be negotiated.

   Seen in: Salesforce, 2014 · Apple, 2013
2. Describe the lock-in the way a regulator would

   In their words, not yours: tying a chat product to a dominant office suite, keeping repair tools for dealers only. If that sentence reads badly, you have found the ceiling, and it is nearer than the revenue suggests.

   Seen in: Microsoft, 2016 · John Deere, 2016
3. Work out the business after a forced unbundling

   Before you press harder, model the company if you are made to unbundle, open the repair tools or drop the clause. Microsoft agreed to seven years of unbundling; Deere paid $99 million and still faces the FTC. Know that number before you need it.

   Seen in: Microsoft, 2016 · John Deere, 2016
4. Loosen the most contested lever yourself, early

   Intuitive Surgical extended its instrument usage limits before litigation could call them coercive. It still faced lawsuits, but it went into court having already cut the price per use, and it won the trial brought by an independent repair company.

   Seen in: Intuitive Surgical, 2020
5. Watch lawmakers, not just competitors

   Deere's limit came from a state right-to-repair law and a federal lawsuit, not from a rival tractor. Microsoft's came from European competition law. The signal that your ceiling is moving usually shows up outside your own market first.

   Seen in: John Deere, 2016
6. Don't advertise an offer most customers can't use

   A free offer that most people can't use turns lock-in into a consumer protection case. The FTC found Intuit's free filing advertising deceptive when two-thirds of taxpayers were not eligible for it.

   Seen in: Intuit, 2003

Warning signs

What it has looked like when this decision was going wrong.

• The lock-in can be described in one sentence that sounds like an antitrust complaint.Microsoft, 2016 · John Deere, 2016
• Customers can only get the product repaired or refilled through you.John Deere, 2016 · Intuitive Surgical, 2020
• A pricing change multiplies bills overnight, on a measure the customer can't reduce.Oracle, 2023
• The offer is advertised as free to everyone, and most people don't qualify.Intuit, 2003
• Pressure is tracked from competitors only, not from legislatures or courts.John Deere, 2016

All 15 cases

Each case is one company at one decision: what was on the table, what it chose, why, and what followed, with every fact sourced.

Questions

What is ecosystem lock-in?

When leaving a product costs a customer more than staying, because of what they have built around it: data, other apps, skills, contacts or loyalty points. Apple's iMessage, which works only on Apple devices, is a well-known example.

Is customer lock-in illegal?

Not by itself. Building a product people find hard to leave is ordinary. It becomes a legal problem when the lock-in is used to shut out competitors, for example by tying one product to another or keeping repair tools from owners. Microsoft's Teams bundle and Deere's repair restrictions both drew regulators.

What are examples of lock-in strategies?

Salesforce's AppExchange marketplace and its certification program, Microsoft bundling Teams into Office 365, John Deere keeping diagnostic tools for dealers, Oracle's per-employee Java pricing, and the Marriott and Hilton loyalty programs.

How do you know when lock-in has gone too far?

When the mechanism can be described as a complaint: a bundle that customers can't decline, repairs only you can do, a price that rises on a measure they can't control. Customers rarely end it. Regulators, lawmakers and courts do.