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US sues iPhone maker for violating antitrust laws – El Financiero

The United States Department of Justice and 16 attorneys general They sued Apple this March 21, accusing the iPhone manufacturer of violate antitrust laws by preventing rivals from accessing hardware and software features of their popular devices.

The lawsuit, filed in federal court in New Jersey, marks the culmination of a five-year investigation about the second most valuable technology company in the world.

Joe Biden’s administration has made competition a cornerstone of its economic policy, and Silicon Valley has become a key focus.

Why is the Department of Justice suing Apple?

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The lawsuit alleges that Apple has used its power over the distribution of applications on the iPhone to thwart innovations that would have made it easier for consumers to switch phones. The company has refused to admit cross-platform messaging apps; limited third party digital wallets and non-Apple smart watches.

Apple recently added support for cloud-based gaming services and said it would add RCS cross-platform messaging later this year.

The group of attorneys general includes those from California, New Jersey and Washington, DC.

When did the investigation against Apple begin?

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The Department of Justice Donald Trump’s administration opened the antitrust investigation against Apple in 2019. A 2020 House investigation into four tech giants found that Apple operates as a monopoly in the distribution of software on the iPhonegenerating massive profits in commissions of up to 30 percent of what it charges developers.

In 2020, Epic Games, the creator of the popular online video game Fortnite, sued Apple over its App Store. A federal judge concluded that the App Store policies did not violate federal antitrust law, but did violate California state law.

As a result of that case, Apple said in January that it would allow American developers to use alternative payment systems, but would charge a lower fee of 27 percent for most digital purchases or 12 percent for subscriptions. Epic disputes those changes, saying they are inappropriate.

On Wednesday, March 20, Microsoft, Meta and X Corp (the company formerly known as Twitter) also criticized Apple’s proposed changes, saying the iPhone maker has imposed onerous limitations on links to alternative payment systems.

Antitrust Lawsuits Vs. Manzana

The lawsuit in the US is the last of a series of antitrust cases against the technology giant. Earlier this month, the European Union fined Apple $2 billion for excluding rival music services on the iPhone.

Meanwhile, the company made several changes to its App Store policies in Europe to comply with the EU’s new control rules for Big Tech: the Digital Markets Act. Cupertino, California-based Apple will allow European users download iPhone apps from the web; will allow developers to offer discounts outside of the App Store, and will allow third-party marketplaces to sell apps.

Apple also restructured the fee charged to European developerssetting a cheaper 17 percent rate along with a 3 percent processing fee for software that uses its in-app purchasing system and a 50-cent fee per app installation for software that is downloaded the most 1 million times in a 12-month period.

Those fees have already raised objections from some developers, and EU regulators are likely to investigate whether Apple’s proposed changes comply with the law.

Last week, the company changed course and said that would restore the Epic Games developer accountwhich would allow the maker of Fortnite to create its own app store in the EU that could compete with Apple’s. This came a day after regulators in Brussels questioned Apple’s decision to ban Epic and raised the possibility of more fines for the iPhone maker.

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