The Justice Department Sues Apple Inc. for Alleged Monopolization of Smartphone Market
In a groundbreaking move, the Justice Department has filed a lawsuit against tech giant Apple Inc., accusing the company of monopolizing the smartphone market and restricting developers from creating apps, products, and services that could potentially lower costs for consumers. The lawsuit claims that Apple commands a massive 65% share of the U.S. smartphone market, with products priced as high as nearly $1,600.
Joined by 16 state and district attorneys general, the lawsuit alleges that Apple has been extracting more money from consumers, software developers, publishers, and merchants. In response, Apple issued a statement defending its innovative technology but warned that the lawsuit could threaten its future capabilities.
Federal officials have drawn parallels between this lawsuit and previous antitrust cases involving companies like Standard Oil, AT&T, and Microsoft. The scrutiny on Apple comes in the wake of similar investigations into the commissions charged on in-app purchases by both Apple and Google.
The European Union regulators had previously accused Apple of violating antitrust laws in the music streaming competition in 2021. Deputy Attorney General Lisa Monaco stated that Apple has stifled competition in the smartphone industry, hindering advancements and innovation.
The lawsuit alleges that Apple has kept prices and fees high by blocking innovative super apps, limiting third-party digital wallets, and suppressing mobile cloud streaming services, among other tactics. Apple’s response to complaints has been described as playing “Whac-A-Mole,” with the company continuously changing contract rules to maintain higher prices and fees.
With a net revenue of $383 billion and net income of $97 billion last year, Apple faces a tough legal battle ahead as it defends its position in the smartphone market. The outcome of this lawsuit could have significant implications for the future of competition within the tech industry.
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