DOJ files "landmark" antitrust lawsuit against Tim Apple, alleging "illegal" monopolization of smartphone market

[Commissar SFLUFAN]

US sues Apple, alleging it illegally monopolized the smartphone market

ARSTECHNICA.COM

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Justice Department files major antitrust lawsuit against iPhone maker.

 

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The US Department of Justice sued Apple today, alleging that the company violated antitrust laws by restricting rivals' access to iPhone features and monopolizing the smartphone market.

 

The lawsuit in US District Court for the District of New Jersey alleged that "Apple suppresses... innovation through a web of contractual restrictions that it selectively enforces through its control of app distribution and its 'app review' process, as well as by denying access to key points of connection between apps and the iPhone's operating system (called Application Programming Interfaces or 'APIs'). Apple can enforce these restrictions due to its position as an intermediary between product creators such as developers on the one hand and users on the other."

 

The DOJ is seeking an order determining that Apple has illegally monopolized the smartphone market in the US. The agency also wants the requested order to block Apple from continuing its allegedly anticompetitive practices.

 

The DOJ said a court order should at minimum prevent Apple from "using its control of app distribution to undermine cross-platform technologies such as super apps and cloud streaming apps," prevent Apple "from using private APIs to undermine cross-platform technologies like messaging, smartwatches, and digital wallets," and prevent Apple "from using the terms and conditions of its contracts with developers, accessory makers, consumers, or others to obtain, maintain, extend, or entrench a monopoly."

 

The DOJ defined "super apps" as those that provide "broad functionality in a single app." These apps that Apple allegedly is undermining "can improve smartphone competition by providing a consistent user experience that can be ported across devices," the DOJ said.

 

 

[Kal-El814]

"Super apps" seems a bit sketchy to me since I don't know that's really a thing?

 

Also is there a definition of monopolization that would include owning half of a market at best? I don't mean that rhetorically, I genuinely don't know.

[Commissar SFLUFAN]

18 minutes ago, Kal-El814 said:

"Super apps" seems a bit sketchy to me since I don't know that's really a thing?

 

They are absolutely a thing in non-American markets.  The best example is China's "WeChat" which is exactly what Elmo wants to turn Xwitter into.

[ThreePi]

Blocking a "super app" feels weird since a "super app" is conceptually it's own monopoly. 

[ort]

I find a lot of rules in the App Store to be pretty shitty, but this really feels like they are kinda reaching on a lot of these points. Are they really a monopoly? They have half the market in the US and like 30% or something like that globally?

 

Are they going to go after Sony, Microsoft and Nintendo for selling closed systems?

 

This reminds me of when they went after Apple for the book store price fixing when Amazon had like 95% of the market.

 

I find Googles stranglehold over search, advertising and web standards to be a million times more concerning personally...

[Ghost_MH]

3 minutes ago, ort said:

I find a lot of rules in the App Store to be pretty shitty, but this really feels like they are kinda reaching on a lot of these points. Are they really a monopoly? They have half the market in the US and like 30% or something like that globally?

 

Are they going to go after Sony, Microsoft and Nintendo for selling closed systems?

 

This reminds me of when they went after Apple for the book store price fixing when Amazon had like 95% of the market.

 

I do believe there is something to be said about toys and general use computers which, in the year 2024, absolutely includes smart phones and tablets. You aren't doing your banking on a Switch. You don't need a PS5 is be a functioning member of society, but you absolutely need a smart phone. Apple might not control the entire market, but the DOJ is claiming that they own enough of the market to push their weight around in a monopolistic manner.

 

This is like California getting to choose emissions standards on cars that affect everyone else. Only, California is legally allowed to do that while Apple probably isn't.

[ort]

My main concern is that the our elected officials have proven time and time again that they have absolutely no fucking clue about any of this stuff.

 

Apple's locked down system is as much of a selling point as it is a hindrance. That's kind of their whole deal. If you don't like it, you have plenty of other very viable options.

[Ghost_MH]

8 minutes ago, ort said:

My main concern is that the our elected officials have proven time and time again that they have absolutely no fucking clue about any of this stuff.

 

Apple's locked down system is as much of a selling point as it is a hindrance. That's kind of their whole deal. If you don't like it, you have plenty of other very viable options.

 

Apple's control only becomes a problem when it controls what's available on Android.

 

How Apple’s war on super apps became the center of its antitrust fight - The Verge

WWW.THEVERGE.COM

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Apple put restrictions on cloud streaming, and now the DOJ is fighting back.

 

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“For years, Apple blocked cloud gaming apps that would have given users access to desirable apps and content without needing to pay for expensive Apple hardware because this would threaten its monopoly power,” the lawsuit reads. “In Apple’s own words, it feared a world where ‘all that matters is who has the cheapest hardware’ and consumers could ‘buy[] a [expletive] Android for 25 bux at a garage sale and... have a solid cloud computing device’ that ‘works fine.’”

 

Apple feared that giving legitimacy to cloud streaming gaming apps wouldn't hurt users, but could convince users they could get away with buying cheaper hardware which includes Android.

 

Same goes for super apps.

 

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However, the DOJ’s lawsuit claims that Apple doesn’t want users or companies in the US to benefit from super apps. It notes that during a board of directors presentation, Apple cited super apps as a “major headwind” to boosting iPhone sales in countries where they’re popular because of “[l]ow stickiness” and “[l]ow switching costs.” If someone benefits from using a super app, they don’t necessarily need to be tied to any one ecosystem — like Apple’s.

 

Apple is doing what it can to stop the development of super apps on iOS because they know it would make switching over to Android easier. When half the market is cut off, few are going to invest in making these apps for Android and Android alone.

[GeneticBlueprint]

3 minutes ago, ort said:

My main concern is that the our elected officials have proven time and time again that they have absolutely no fucking clue about any of this stuff.

 

You are 100% correct here. But--and I don't know enough about this particular case to opine in any which way--the DOJ isn't made up of elected officials. Elected officials can encourage or discourage internal policy, but the smart people that have to implement it need to know what they're doing. Until the current administration, the federal government has been very lackadaisical towards anti-trust and monopoly this century. So they must feel strongly about this one.

[ort]

Apple will be allowing streaming apps and iMessage will also soon have full support for RCS.

 

Marrick Garland presented some email exchanges in 2012 and a joke Tim Cook made during a Q&A session as evidence they are acting maliciously. I'm not sure I hold them in that much confidence either.

 

It's kind of funny, because I do want apple to change their stance on most of these things, but I do not want the government to decide how they should do it.

 

I think I'm just confused about when and how incredible common business tactics and strategies suddenly became anti-competitive. Where is the line?

[SaysWho?]

49 minutes ago, ort said:

Apple will be allowing streaming apps and iMessage will also soon have full support for RCS.

 

Marrick Garland presented some email exchanges in 2012 and a joke Tim Cook made during a Q&A session as evidence they are acting maliciously. I'm not sure I hold them in that much confidence either.

 

It's kind of funny, because I do want apple to change their stance on most of these things, but I do not want the government to decide how they should do it.

 

I think I'm just confused about when and how incredible common business tactics and strategies suddenly became anti-competitive. Where is the line?

The line is somewhere else other than where it is now.

[ort]

Also, who is asking for super apps? That has always seemed like the worst idea ever. Talk about lock-in.

 

For a country that is so concerned about everything involving China, shitting all over the most successful American company and saying the stated purpose of said shitting is to actively encourage a flood of cheap Chinese competitors seems a little weird to me.

 

When they say they want force apple to make it easier for cheaper option to thrive, who are they envisioning will create these cheap options? When they say they want to encourage super apps, who do they envision creating these super apps? Amazon, Google, Meta, X? Does anyone think the world would be a better place if all anyone did on their phones was launch a google or amazon super app? Because that's what will happen.

 

 

Anyway, Apple has no one to blame for this but themselves. They should have read the tea leaves a decade ago and started loosening up some of the dumber crap they were pulling... loosen up the App Store rules and adopting RCS into iMessage like 5 years ago would have probably gone a long way toward avoiding this and now they are going to end up with who knows what rules dropped on them.

 

I just don't see how this will actually help the market be more open. This isn't going to create new competition, it's just going to strengthen all of their competitors... all of whom I trust way less than Apple.

[Ghost_MH]

45 minutes ago, ort said:

Also, who is asking for super apps? That has always seemed like the worst idea ever. Talk about lock-in.

 

Mostly people that aren't as tech savvy. For instance, they'd prefer one Comcast app that does everything instead of multiple apps to handle wireless versus Wi-Fi versus paying their bills. Apple only allows one primary category per app plus a single secondary function. That's why T-Mobile and other carriers have a dozen apps instead of one main app that can handle every need of their customers. Unfortunately, that then carries over to Android because making two sets of the same app is already a lot of work, but two sets of entirely different apps is a bridge too far.

[TwinIon]

I think the super app thing is useful for the DOJ for a few reasons. The biggest thing is that it's very clear Apple doesn't like them and Apple takes a bunch of very obvious and some very technical steps to prevent them. They don't allow third party payment systems, they don't allow mini-apps, they prevent PWAs from accessing a bunch of APIs. Another big reason is that China provides a counterfactual example of what the smartphone market could look like if Super-Apps were popular in the US. The DOJ also have convenient emails from Apple talking about how Apple don't like super-apps because they reduce stickiness.

 

So you have a thing that we know Apple doesn't want, where it's easy to show the policy and technical barriers that Apple puts up to prevent their adoption, with a thing we can show does work overseas. I think that makes it a good case to take to court.

 

Also, even if you don't care about super-apps, if the DOJ wins on these counts, there are a bunch of things that could conceivably help plenty of non-super-apps. If you open up payment options or PWA API access or just in general lessen the control Apple is able to exercise over the content of apps, all of that could benefit plenty of different apps.

 

 

[TwinIon]

On 3/21/2024 at 12:47 PM, ort said:

Apple will be allowing streaming apps and iMessage will also soon have full support for RCS.

 

Marrick Garland presented some email exchanges in 2012 and a joke Tim Cook made during a Q&A session as evidence they are acting maliciously. I'm not sure I hold them in that much confidence either.

 

It's kind of funny, because I do want apple to change their stance on most of these things, but I do not want the government to decide how they should do it.

 

I think I'm just confused about when and how incredible common business tactics and strategies suddenly became anti-competitive. Where is the line?

That's just the nature of anti-trust. The rules are different once you control enough of the market. It's the most natural thing in the world to build your products in a way that makes people want to use more of your products. Apple has done this very successfully; arguably more successfully than anyone else ever has. It only becomes a problem when the government decides that it's become a problem. That does kind of rub me the wrong way, but it does actually make some sense in context.