Or it disincentivizes creating those features, if you must give it to your competitors.

That’s a rather silly view to take. We have a phenomenon called “the first mover advantage” for a reason.

Plenty of other markets and businesses operate just fine while operating in an environment that makes protecting individual innovation functionally impossible. Just look at any related to fast fashion (not that I think the fast fashion market is a healthy phenomenon) or any commodities market. Or for that matter, most of the software industry.

The incentive for creating features should be to remain relevant and competitive. It shouldn’t be to build moats and war chests.

I would agree in general, but in this specific case it’s still an advantage for the iOS platform in general. It just removes a buying incentive for the AirPods.

The general problem is that there must be a line.

Vendors don’t create lock-ins because they are malicious, they create it because it makes them money.

Now, if we limit these lock-ins, it will reduce their ability to make money and yes, it will impact some features - short term.

But looking at it long terms, vendor lock-ins are actually a reason to stop innovating: your customers are locked in anyway.

So, overall, I would say this is good for innovation in general.

Isn't Apple currently disincentivized to make features because they don't even allow competing smartwatches to access a basic feature set on iPhone?

You're basically saying Apple would be disincentivized to innovate on the Apple Watch because Apple would need to release the underlying APIs that make those work with the phone to competing solutions. But the status quo is that competing solutions that are already better than the Apple Watch straight up aren't allowed on the platform, and the Apple Watch generally costs more than its competitors.

You are unintentionally saying that if Apple had to allow third parties to use their private APIs, that the Apple Watch would have to cost less and/or innovate more in order to convince us all to buy it instead of buying a watch from Samsung or Google.

What you are describing is a more competitive and open market where consumers benefit from lower prices and more of an incentive to innovate and justify high prices.

I would also dispute the notion that merely releasing these APIs would somehow give away all your secret sauce. Competitors still have to build the experience on top of that.

I disagree with this, but it shouldn't get downvoted. That's not how it works here.

Bro, market is there to benefit consumer first, not to make money for shareholders.