US DOJ sues Apple accusing it of antitrust violations

Apple is being sued by the United States Department of Justice and 15 states for violating antitrust law, specifically Section 2 of the Sherman Antitrust Act. The DOJ claims that Apple has maintained its dominance in the US market by violating antitrust law instead of solely relying on its own merits.

The DOJ stated in its announcement that it holds the belief that Apple engages in exclusionary and anticompetitive behavior, which has a negative impact on both consumers and developers. The explanation further stated that rather than improving its own products, Apple has strengthened its control by diminishing the quality of other products.

The Department of Justice (DOJ) accused Apple of negatively impacting consumers through limited options, increased costs and fees, decreased quality of smartphones, apps, and accessories, and reduced innovation from both Apple and its competitors. The DOJ also claimed that Apple’s rules have forced developers to comply, creating a barrier to competition.

The Department of Justice (DOJ) described Apple’s anticompetitive actions in the following manner:

“First, Apple imposes contractual restrictions and fees that limit the features and functionality that developers can offer iPhone users.

Second, Apple selectively restricts access to the points of connection between third-party apps and the iPhone’s operating system, degrading the functionality of non-Apple apps and accessories.

As a result, for most of the past 15 years, Apple has collected a tax in the form of a 30% commission on the price of any app downloaded from the App Store as well as on in-app purchases. Apple is able to command these fees from companies of all sizes.”

Despite being accused of suppressing the emergence of new app categories such as cloud streaming and super apps, which could potentially weaken the reliability of its ecosystem, Apple also faced criticism for its handling of iMessage. The Department of Justice highlighted how Apple deliberately limits the functionality of its own messaging app and third-party messaging apps, making it difficult for users to communicate with those on Android devices.

One other aspect of worry is related to Apple Wallet. According to the DOJ, Apple encourages companies to join Apple Wallet, but subsequently prohibits them from creating other payment products and services specifically for iPhone users. The department also noted that Apple has hindered third-party developers from producing digital wallets that utilize tap-to-pay capabilities, which is a significant limitation.

The DOJ emphasized that this kind of monopolistic conduct negatively impacts the free and fair markets that are the foundation of the US economy. It stated that such actions harm producers, workers, and customers, and it intends to aggressively uphold antitrust laws to address this issue.

The US Department of Justice, as reported by Reuters, has filed a lawsuit against Apple for allegedly engaging in monopolistic practices. The lawsuit was announced by Attorney General Merrick B. Garland in a speech.