Apple v. U.S. antitrust case: Everything we know so far about the Justice Department’s iPhone case

Image credits: Bryce Durbin/TechCrunch

Apple’s antitrust scrutiny is at its peak. The U.S. Department of Justice announced a lawsuit Thursday accusing the company of acting like a monopoly, locking in iPhone customers and restricting competitors from developing hardware and software. The case comes on the heels of significant antitrust litigation against Apple outside the United States, and while it is a wide-ranging and complex case, we will discuss the details of the Justice Department’s case, the industry’s response, and the ongoing All influences are covered. Both companies and customers.

We will continue to update this page as Apple’s antitrust case develops, but keep in mind that little is resolved in the short term. Experts estimate that the case will take three to five years to resolve.

Department of Justice’s claims against Apple

If you want a quick dive into the legal documents, you can read the Department of Justice’s lawsuit here. But for the rest of us, there are his five categories identified in the complaint as areas where Apple actively suppressed competition.

“Super” app: These are applications that contain many features within one app. This should ring alarm bells for those following Elon Musk’s “every app” ambition for X, with the Justice Department claiming that Apple is hampering X’s success in order to increase dependence on the iPhone. ing.

Messaging app: The blue bubble, green bubble effect has been specifically cited by the Department of Justice as a factor preventing iPhone users from adopting competitors’ devices. “This effect is particularly strong among certain demographics, such as teenagers, who according to one study have an 85 percent share of iPhone ownership,” the Justice Department said in its lawsuit.

Cloud streaming game app: The Justice Department’s lawsuit highlights Apple’s alleged opposition to cloud-based gaming, saying the company’s actions allow consumers to “do it without requiring them to purchase powerful and expensive hardware.” They claim that it prevents them from playing the game.

Digital wallet: Although the 0.15% fee that Apple takes on every transaction made through Apple Pay is part of the company’s total revenue, the Department of Justice says Apple Pay’s widespread adoption within the mobile ecosystem is means they have “full control” over their users’ NFC payments, which puts them in the way of competitors.

Smartwatch cross-platform compatibility: The Justice Department’s argument is clear. Restricting the functionality of the Apple Watch on devices other than the iPhone “increases the cost of purchasing another type of smartphone for its users,” the lawsuit claims.

Apple and the industry-wide reaction

Apple on Thursday issued an extensive set of rebuttals to the Justice Department’s claims. Details can be found here. At the heart of Apple’s argument is that regulators are selectively choosing metrics that make Apple’s strength in the smartphone market seem more dominant than it actually is. And if the Justice Department reins in what it claims is monopolistic behavior, it would reduce Apple’s competitive advantage in the market and harm iPhone customers in the process.

“This lawsuit threatens who we are and the principles that make Apple products stand out in a fiercely competitive market. “This would impede our ability to develop our products,” Apple said in a statement provided to TechCrunch.

App makers have been less critical of the Justice Department’s case, with the App Fairness Coalition (CAF) expressing strong support for the Justice Department’s regulatory actions, but some of its member companies, including Epic Games and Spotify, This is not surprising, given that it has already caused controversy in public. What Apple is doing with the App Store.

“The Department of Justice’s complaint alleges that App Store guidelines and developer agreements were abused to increase prices, charge exorbitant fees, and undermine the user experience,” CAF Executive Director Rick VanMeter said in a statement Thursday. “It details Apple’s long history of illegal conduct that degrades the market and inhibits competition.” “The Department of Justice joins regulators around the world who recognize and are working to address the many harms caused by Apple’s misconduct.”

What does this mean for iPhone users and what happens next?

Not so much for the time being. The release of the lawsuit and subsequent back-and-forth between Apple and the Department of Justice has been hectic and will likely take years to resolve. The Justice Department’s antitrust lawsuit against Google, filed in 2020, went to trial last year but could take several more years to reach a conclusion.

Don’t expect the present to unfold in the same way as the past. Although the Department of Justice cites successful antitrust prosecutions against Microsoft in the 1990s, there are many differences between the two cases, most notably that Microsoft’s market power has significantly affected Apple’s current situation. The difference is how easily it was defined compared to

Learn more about Apple’s antitrust lawsuit here.