For years, Apple has reigned supreme in the global smartphone market, but dissent is brewing. The United States has just filed a lawsuit against the tech giant, accusing it of monopolising the mobile market.
The US Justice Department has levelled serious accusations against Apple, claiming that it has unlawfully stifled competition by hindering the progress of rival apps that challenge its market dominance. Apple has lashed back at the claims, saying it will “vigorously” fight the lawsuit, as reported by the BBC.
As the stage is set for a high-stakes confrontation between the US Justice Department and Apple, speculation mounts over who will win. But perhaps the more pertinent question is, who should win? After all, Apple has undeniably been a powerhouse in the tech industry for years, and it seems some think it may be time for new contenders to emerge and share the spotlight.
Exploring The Lawsuit
While Apple has weathered its share of criticisms over the years, this latest landmark lawsuit marks one of the biggest challenges against Apple to date, literally. The complaint against the tech giant is a hefty 88 pages long.
As per the BBC report, the Justice Department alleges that Apple has exploited its control over its iPhone app store to entrench its hold on both customers and developers through what the department describes as “shapeshifting rules”. These work to restrict access to its hardware and software, ultimately aimed at bolstering its own profits at the expense of consumers and stifling innovation.
According to the Justice Department, Apple’s share of the US smartphone market exceeds 70%, and its share of the broader smartphone market exceeds 65%.
During a press conference announcing the suit, Attorney General Merrick Garland explained: “Apple has maintained monopoly power in the smartphone market not simply by staying ahead of the competition on the merits but by violating federal anti-trust law”
“Customers should not have to pay higher prices because companies break the law.”
Numerous instances have been cited to illustrate Apple’s alleged anti-competitive behaviour:
Among them, Apple stands accused of manipulating app reviews on its App Store to lower the appeal of rival applications. Additionally, the company is said to have intentionally created barriers for users to connect with smartwatches from competing brands, thus nudging them toward Apple watches. Furthermore, subtle design changes, such as altering the colour of text bubbles in messages to non-iPhone users, have been cited as tactics aimed at fostering a “social stigma” against non-Apple devices.
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How Has Apple Retaliated?
Apple has taken a resolute stance against the lawsuit, asserting that customers remained loyal to the brand because they were genuinely satisfied with its products. The tech giant is so confident that it is already predicting the lawsuit to fail.
“We believe this lawsuit is wrong on the facts and the law, and we will vigorously defend against it,” the company said.
It appears the case will hinge on the question of motivation. Bill Baer, a former anti-trust official, explains: “Anti-trust laws and the court’s interpretation of them suggest that once you’re a monopolist”
“If you do engage in behaviours that have no legitimate business justification other than to limit competition and cement your monopoly, then that is problematic.”
So, the big question is: while Apple undeniably dominates the market, has this dominance been deliberately engineered to establish a monopoly? The investigation will primarily focus on unravelling this inquiry to reach a conclusion.
Will There Be An End to Mobile Monopolisation?
If the government does win its case against Apple, the repercussions could be drastic. Not only might it compel the company to overhaul its current contracts and practices, but it could even lead to the breakup of the tech giant.
While the legal process could stretch out over a period of years, what exactly could the smartphone landscape look like if Apple ends its market monopolisation?
Rebecca Allensworth, a Vanderbilt University professor, asserts that, at its core, this lawsuit is about increasing functionality between smartphones and broadening accessibility for consumers and businesses alike.
“It’s not about breaking up Apple into small units or spinning off divisions,” she explained.
Indeed, the demise of Apple’s monopoly could sound like a harsh end, but it could herald a seismic shift, fostering greater openness, adaptability, and innovation within the smartphone arena. It might encourage changes such as more seamless integration with non-Apple products, encouraging easier access to diverse services whatever your mobile phone brand.
Anat Alon-Beck, a professor at Case Western Reserve University, emphasises: “It’s not just about the 30% app store fee, but about the core unfair practices of Apple,”
“Apple systematically excludes rivals from the Apple ecosystem. By doing that, Apple is hurting so many startup businesses, stakeholders, customers and, in my opinion, its shareholders,” she said.
So, is it about time that legal action was taken against the tech giant?
As observed by Anat Alon-Beck, an end to Apple’s monopolisation could unleash a wave of opportunities for burgeoning tech startups and enterprises, fostering an environment ripe for innovation within the industry. Freed from the constraints imposed by Apple’s dominance, these startups may find greater room to thrive, develop new ideas, and introduce fresh perspectives to the market, resulting in a dynamic ecosystem where competition thrives, ultimately benefiting consumers with a broader array of innovative products and services.
