So there's that...
If I own the football team, and the field, and the city (hell, why not), then sure I can choose who plays QB, so I choose my son. Maybe at the start he's even not that bad of a QB, and our team wins some games. Everyone is happy.
After a little while though, people realize there's no sense trying out for QB on my team. My son, now left without anyone gunning for his job becomes complacent. We start losing games more and more.
With enough control over the market (like Apple has with the App Store), there become less and less QBs to choose from, and it's not just my team that gets worse, but the whole league.
Apple built, run, maintains and owns a stadium. The stadium has a food court with many food stalls.
Some of them, Apple runs themselves, but tons of others are run by people who pay N% of their revenues to Apple to be able to have them.
They still need to supply their own food, branding, marketing, furniture, and pay their staff, Apple gives them access to the stadium crowds and a payment processing system.
Apple is not obligated to advertise those third party stalls over their own.
If they don't like the arrangement they can always go somewhere else (there is an even bigger stadium in town that has available food stalls).
So the argument is going to boil down to this... Is the curation Apple does to the App Store worth market effects of effectively turning it into a stadium for software? Given that I can't easily give my friend the tool I built to run on their phone, and the App Store is filled with "bad" apps (by basically every definition), I'm going to argue it's not worth it.
I don't understand how you arrived at this conclusion.
I figured that it'd mean nobody tries out for QB on your team, all the best QBs go to other teams, eventually your team starts to suck and lose fans and therefore revenue, and the market forces either force you to get a new QB or your business in the team suffers and maybe folds. Problem solved either way, eventually.
It's as if you're the one selling all the tickets to the only stadium in town, and you make it so that when your team plays, tickets are cheaper, more abundant, and more visible.
Another local team wants to play too, but their ticket prices are outrageous, there's no promotion of the event either, and they might actually be banned from the stadium unless they use ONLY your equipment.