U.S. Sues Apple Alleging Antitrust Violations

The United States Justice Department has filed suit against Apple, alleging the company has violated antitrust law.

"Consumers should not have to pay higher prices because companies violate the antitrust laws," U.S. Attorney General Merrick Garland said in a statement. "If left unchallenged, Apple will only continue to strengthen its smartphone monopoly."

The DOJ alleges that Apple exercises its monopoly power to extract more money from consumers, developers, content creators, artists, publishers, small businesses, and merchants. It claims the company selectively imposes contractual restrictions on developers and withholds critical ways of accessing iPhone.


Here are a few of the methods Apple purportedly uses to maintain its monopoly...

● Blocking Innovative Super Apps. Apple has disrupted the growth of apps with broad functionality that would make it easier for consumers to switch between competing smartphone platforms.
● Suppressing Mobile Cloud Streaming Services. Apple has blocked the development of cloud-streaming apps and services that would allow consumers to enjoy high-quality video games and other cloud-based applications without having to pay for expensive smartphone hardware.
● Excluding Cross-Platform Messaging Apps. Apple has made the quality of cross-platform messaging worse, less innovative, and less secure for users so that its customers have to keep buying iPhones.
● Diminishing the Functionality of Non-Apple Smartwatches. Apple has limited the functionality of third-party smartwatches so that users who purchase the Apple Watch face substantial out-of-pocket costs if they do not keep buying iPhones.
● Limiting Third Party Digital Wallets. Apple has prevented third-party apps from offering tap-to-pay functionality, inhibiting the creation of cross-platform third-party digital wallets.

"For years, Apple responded to competitive threats by imposing a series of 'Whac-A-Mole' contractual rules and restrictions that have allowed Apple to extract higher prices from consumers, impose higher fees on developers and creators, and to throttle competitive alternatives from rival technologies," DOJ antitrust division chief Jonathan Kanter said.

Apple has replied with the following statement...


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At Apple, we innovate every day to make technology people love—designing products that work seamlessly together, protect people's privacy and security, and create a magical experience for our users. This lawsuit threatens who we are and the principles that set Apple products apart in fiercely competitive markets. If successful, it would hinder our ability to create the kind of technology people expect from Apple—where hardware, software, and services intersect. It would also set a dangerous precedent, empowering government to take a heavy hand in designing people's technology. We believe this lawsuit is wrong on the facts and the law, and we will vigorously defend against it.
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There is a live stream starting now during which the DOJ will likely outline its case. Please download the iClarified app or follow iClarified on Twitter, Facebook, YouTube, and RSS for more updates.

Update:
Here is the the official 88 page complaint. View