The US Department of Justice (DOJ), along with 16 state and district attorneys general, has filed an antitrust lawsuit against Apple [APPL:US] over itsmonopolization or attempted monopolization of smartphone markets, as reported by Reuters on March 21. The officials alleged that Apple “selectively” imposes contractual restrictions on developers and withholds critical ways of accessing the phone. Such exclusionary conducts have sabotaged innovation for Apps, products, and services, and led to higher costs for consumers and developers, according to the lawsuit. The complaint asked the court to prevent Apple from using its control of app distribution, contracts, and use of private software interfaces to undermine competitors and to take other necessary measures “to restore competitive conditions in the markets affected by Apple’s unlawful conduct.”

The lawsuit outlined several forms of anticompetitive behaviors by Apple, such as blocking innovative Super Apps that make it easier for iPhone users to switch to competing devices, suppressing the quality of messagingbetween the iOS and competing platforms like Android, and limiting the functionality of non-Apple smartwatches. In response to the allegations, Apple contended that the lawsuit threatens the principles that make Apple products outstand in fiercely competitive markets, potentially hindering its ability “to create the kind of technology people expect from Apple — where hardware, software, and services intersect.” The lawsuit adds to the recent antitrust scrutiny faced by Apple. Earlier this month, the European Commission also fined Apple EUR1.84bn for abusing its dominant position in the market for the distribution of music streaming apps.

Sources:

https://www.reuters.com/legal/us-takes-apple-antitrust-lawsuit-2024-03-21/

https://www.justice.gov/opa/pr/justice-department-sues-apple-monopolizing-smartphone-markets

https://www.theverge.com/2024/3/21/24105363/apple-doj-monopoly-lawsuit

https://www.theguardian.com/business/2024/mar/04/eu-fines-apple-18bn-over-app-store-restrictions-on-music-streaming