US takes on Apple in antitrust lawsuit

kovop / Shutterstock.com

The US Department of Justice on Thursday sued Apple, the first major antitrust effort against the iPhone maker by the Biden administration, alleging it monopolised smartphone markets.

Apple joins a list of major tech companies sued by US regulators, including Alphabet's Google, Meta Platforms and Amazon.com across the administrations of both former President Donald Trump and President Joe Biden.

"Consumers should not have to pay higher prices because companies violate the antitrust laws," Attorney General Merrick Garland said in a statement.

"If left unchallenged, Apple will only continue to strengthen its smartphone monopoly."

The Justice Department, which was also joined by the District of Columbia in the lawsuit, alleges that Apple uses its market power to get more money from consumers, developers, content creators, artists, publishers, small businesses and merchants.

The 88-page lawsuit, filed in US federal court in Newark, New Jersey, said it was focused on "freeing smartphone markets from Apple’s anticompetitive and exclusionary conduct and restoring competition to lower smartphone prices for consumers, reducing fees for developers, and preserving innovation for the future."

In the lawsuit, the US added that "Apple repeatedly chooses to make its products worse for consumers to prevent competition from emerging."

Apple disagreed in a statement, saying: "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."

The company has already been subject to antitrust probes and orders in Europe, Japan and Korea, as well as lawsuits from corporate rivals such as Epic Games.

One of Apple's most lucrative businesses - its App Store, which charges developers commissions of up to 30 per cent - has already survived a lengthy legal challenge under US law by Epic.

While the lawsuit found that Apple did not violate antitrust laws, a federal judge ordered Apple to allow links and buttons to pay for apps without using Apple's in-app payment commission.

In Europe, Apple's App Store business model has been dismantled by a new law called the Digital Markets Act that went into effect earlier this month.

Apple plans to let developers offer their own app stores - and, importantly, pay no commissions - but rivals such as Spotify and Epic argue Apple is still making it too hard to offer alternative app stores.

The rulings on Apple's App Store forced the Justice Department to look at Apple's other practices for the basis of a complaint, such as how Apple allows outside firms to access the chips and sensors in the iPhone.

Consumer hardware firms, such as smart-tracker maker Tile Inc, have long complained that Apple has restricted the ways in which they can work with the iPhone's sensors while developing competing products that have greater access.

Apple began selling AirTags - which can be attached to items like car keys to help users find them when they are lost - several years after Tile had been selling a similar product.

Similarly, Apple has restricted access to a chip in the iPhone that allows for contactless payments. Credit cards can only be added to the iPhone by using Apple's own Apple Pay service.

And Apple has also faced criticism over its iMessage service, which only works on Apple devices.

Apple has long argued that it restricts access to some user data and some of the iPhone's hardware by third-party developers for privacy and security reasons.

More from International

  • Macron appoints new Prime Minister amid political crisis

    French President Emmanuel Macron has named Francois Bayrou his third prime minister of 2024, tasking the veteran centrist with steering the country out of its second major political crisis in the last six months.

  • Blinken meets Erdogan over clashes in Syria

    US Secretary of State Antony Blinken arrived in Turkey on Thursday for talks focused on establishing stability in Syria after clashes between forces backed by the US and Turkey erupted in the north.

  • Israel kills at least 66 Palestinians in Gaza

    An Israeli strike killed at least 30 Palestinians and wounded 50 others who were sheltering in a post office in central Gaza Strip, bringing the death toll on Thursday in the enclave to 66. 

  • Israel, Palestinians explore Gaza truce with US envoy

    Israelis and Palestinians are signalling new efforts to forge a ceasefire deal, even a limited one, for the first time in a year that would pause the fighting in Gaza and return to Israel some of the hostages still held in the Palestinian enclave.

  • Biden pardons 39, commutes sentences of 1,500 others

    Outgoing US President Joe Biden said on Thursday he was pardoning 39 people convicted of non-violent crimes and commuting the sentences of nearly 1,500 others who were serving long prison terms.