Less than three weeks after the European Commission hit Apple with a 鈧1.8 billion ($1.95 billion) antitrust fine for 鈥渁busive App store rules for music streaming services鈥, the U.S. Department of Justice has sued Apple for allegedly 鈥渕onopolizing smartphone markets鈥. The DOJ, along with 16 state and district attorneys general, accuses Apple of using and maintaining its dominant position in the U.S. smartphone market by engaging in behavior that stifles competition and, as a consequence, hurts U.S. consumers.
鈥淎pple undermines apps, products, and services that would otherwise make users less reliant on the iPhone, promote interoperability, and lower costs for consumers and developers,鈥 the DOJ . 鈥淎pple exercises its monopoly power to extract more money from consumers, developers, content creators, artists, publishers, small businesses, and merchants, among others.鈥
The that encompasses 88 pages focuses on five different examples of Apple engaging in what the DOJ thinks is illegal, anticompetitive behavior. Those examples include Apple鈥檚 treatment of so-called super apps (e.g. WeChat), cloud streaming apps (mostly for gaming), cross-platform messaging, smartwatches and digital wallets. In all of these examples, the DOJ alleges, Apple used it position to put in place rules and policies that make it harder for non-Apple devices and services to compete with Apple鈥檚 own offerings, thus keeping users in the company鈥檚 (in)famous walled garden.
鈥淩ather than respond to competitive threats by offering lower smartphone prices to consumers or better monetization for developers, Apple would meet competitive threats by imposing a series of shapeshifting rules and restrictions in its App Store guidelines and developer agreements that would allow Apple to extract higher fees, thwart innovation, offer a less secure or degraded user experience, and throttle competitive alternatives,鈥 the DOJ describes Apple鈥檚 鈥減laybook鈥, which it has allegedly deployed across many technologies, products and services.
Apple responded by calling the lawsuit 鈥渨rong on the facts and the law鈥 and saying that it would 鈥渧igorously defend against it鈥. In fact, the DOJ attacks the very core of Apple鈥檚 business model, which is creating products and services that seamlessly work together, and thus by definition make it less attractive for users to opt for non-Apple products. Whether or not, or to what extent, Apple鈥檚 behavior is against antitrust laws is now for the courts to decide. Experts think that the lawsuit, which has been years in the making, could drag on for years before we see a verdict.




















