The Department of Justice announced an antitrust case against Apple for alleged violations that illegally block competition on smartphone devices and monopolize the smartphone industry. The case, which was filed in New Jersey, is the third time in 14 years that the DOJ sued Apple for antitrust violations.
The U.S. government said it is coming down on the technology industry because their power “has gone largely unchecked over the past several decades.”
”Apple has maintained monopoly power in the smartphone market not simply by staying ahead of the competition on the merits but by violating federal antitrust law,” Attorney General Merrick Garland said. “Consumers should not have to pay higher prices because companies break the law.”
The case revolves around how Apple “blocks ‘super’ apps, suppresses mobile cloud streaming services, blocks cross-platform messaging apps, limits third-party digital wallets, and even limits how well third-party smartwatches work on its platforms,” The Verge reported.
“If left unchallenged, Apple will only continue to strengthen its smartphone monopoly,” Garland said. “But there’s a law for that.”
Therefore, the DOJ’s lawsuit seeks to change Apple’s business model with three specific court orders, which include:
- prohibiting Apple from using its app store to block new apps
- blocking Apple from restricting and preventing other messaging apps, smartwatches, digital wallets and other apps from integrating with the iPhone
- stopping Apple from using its contractual terms to “obtain, maintain, extend, or entrench” the company’s current position in the market
Apple spokesperson Fred Sainz said the company denies the case’s allegations and will fight them in court to ensure the U.S. government doesn’t “take a heavy hand in designing people’s technology.”
“This lawsuit threatens who we are and the principles that set Apple products apart in fiercely competitive markets,” Sainz said.
Many organizations applaud the DOJ for “their bold action to restore competition and fairness in the digital economy,” The Tech Oversight Project said.
“The Department of Justice’s complaint makes one thing crystal clear: Apple has built a moat around its smartphone monopoly that increases prices and stifles innovation,” Sacha Haworth, executive director of the Tech Oversight Project, said. “The company willfully breaks the law—to the detriment of its customers—by degrading its own product’s connectivity, extracting monopoly rents in the form of a 30 percent commission from app makers, ensuring that only Apple has access to key phone components, and self-preferencing its own products and apps while limiting and controlling their competitors’ ability to innovate, or blocking them from entering the space altogether. We applaud the Department of Justice and the Biden Administration for taking this historic step to protect the American people and create a better digital economy.”
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