It was an interesting week for Apple and the tech community. Last week the Supreme Court ruled that iPhone users can sue Apple for violating US Antitrust rules. The court claims that the App Store could be a Monopoly.
In the majority ruling, Justice Kavanaugh wrote, “retailers engage in unlawful anticompetitive conduct that harms consumers… and that is why we have antitrust laws”. In the opinion, the Supreme Court does not accuse Apple of violating antitrust law. However, the court maintains that consumers have the right to sue a company for monopolistic behavior. Applications must come directly from the App Store.
The case started back in 2011. iPhone owners brought the class action lawsuit that by Apple taking 30% of revenue from app sales, developers were encouraged to raise their prices. As a result, consumers will be harmed because the only place to purchase apps is the App Store. Apple maintains that this is a quality control feature to ensure that apps do not violate the company’s terms of service.
Furthermore, Apple claimed that it was only an intermediary, and therefore, could not be sued. Apple is confident it will prevail in the case “The App Store is not a monopoly by any metric,” the company said in a press release. “Developers set the price they want to charge for their app and Apple has no role in that.”
Conversely, antitrust experts welcome the verdict. The tech industry has been criticized for being concentrated and powerful. They note that the case will likely end up in years of litigation, but it is an essential first step. Tech giants will have to think about how to operate online storefronts, many of which are ‘walled off’ in their way.
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