The US Department of Justice and Federal Trade Commission are exploring an antitrust inquiry into Apple's ban on iPhone code translation, according to a report citing a "person familiar with the matter."

The New York Post reports that the DoJ and FTC are "locked in negotiations" over which will investigate a recent change to the iPhone SDK that bars developers from coding applications in ways Apple CEO Steve Jobs doesn't approve of. The Post's unnamed source says the two government watchdogs are "days away" from a decision, claiming that the investigation will explore whether the ban harms competition by forcing coders to choose between applications that run only on Apple devices, and cross-platform apps suited to rival hardware as well.

Early last month, when Apple released its SDK for the upcoming iPhone OS 4.0, it added new language that says applications must be "originally written" in the languages officially supported by the OS. "Applications must be originally written in Objective-C, C, C++, or JavaScript as executed by the iPhone OS WebKit engine, and only code written in C, C++, and Objective-C may compile and directly link against the Documented APIs," reads the new SDK, which covers development on the iPhone, iPod touch, and iPad. "e.g., Applications that link to Documented APIs through an intermediary translation or compatibility layer or tool are prohibited."

Last week, in a 1,700-word attack on Adobe Flash, Steve Jobs indicated that this code translation ban is an effort to prevent the development of "sub-standard" applications. "We know from painful experience that letting a third party layer of software come between the platform and the developer ultimately results in sub-standard apps and hinders the enhancement and progress of the platform," he wrote. "This becomes even worse if the third party is supplying a cross platform development tool. The third party may not adopt enhancements from one platform unless they are available on all of their supported platforms.

"Hence developers only have access to the lowest common denominator set of features. Again, we cannot accept an outcome where developers are blocked from using our innovations and enhancements because they are not available on our competitor’s platforms."

Obviously, Apple is barring the use of Adobe's new iPhone packager, which translates Flash script into iPhone machine code. But it's unclear whether the company is also banning cross-platforms tools along the lines of Appcelerator's Titanium, PhoneGap, and Unity 3D. These kits also let you develop in languages other than Objective C, C, and C++, but they dovetail with Apple's XCode IDE and they translate into Objective C before compiling.

Considering that Jobs' open letter on Flash did not mention other cross-platform kits - and that he went out of his way to attack Flash in particular - the assumption is that the likes of Titanium will not be banned. But we won't know for sure until developers start submitting iPhone 4.0 applications for inclusion in Apple's App Store. iPhone OS 4.0 is set to reach the Jesus Phone this summer, and it will follow on the iPad in the fall.

After Apple's SDK change, a report indicated that Adobe was preparing to sue the company on unspecified grounds. But in the weeks since, Adobe has signaled its intention to move on. It has ceased development of its iPhone packager, and it has joined Google in announcing that it's working to put Flash 10.1 on Android phones.

It's worth noting that although the iPhone is hugely influential, the device's market share is relatively small. According to comScore, the RIM BlackBerry controls 42 per cent of the smartphone market, and the iPhone is at 25 per cent. Google's Android is at 9 per cent - and on the rise. ®