A billion dollar Apple lawsuit has been filed on behalf of more than 1,500 app developers, accusing the company of ‘abusive’ commission levels on app sales and subscriptions.
The antitrust lawsuit says that Apple’s monopoly on the sale and distribution of iOS apps means that it is able to set its own commission levels, and that developers have no choice but to accept it …
Background
This is, of course, a regular accusation levied against Apple, by anyone from individual developers – like Epic Games – to antitrust regulators around the world.
The crux of the argument comes down to the definition of the market for iPhone apps. Apple considers the relevant market to be either “smartphones” or “apps,” and argues that it holds a minority share of this market. It therefore cannot have the dominant position needed to find it guilty of monopolistic behavior.
The opposing view is that the relevant market is “iOS apps,” and here Apple has a 100% monopoly on their sale and distribution. Edge cases aside, there is currently no way for a developer to bring an iOS app to market without selling it through the App Store.
Antitrust regulators tend to take this latter view, and they are joined in this by many developers.
Billion dollar Apple lawsuit
Reuters reports on the latest development: a billion dollar class action lawsuit on behalf of over 1,500 developers in the UK.
Apple on Tuesday found itself the target of a 785-million-pound ($1 billion) class action lawsuit brought by more than 1,500 apps developers in the UK over its App Store fees […]
The UK lawsuit at the Competition Appeal Tribunal is being brought by Sean Ennis, a professor at the Centre for Competition Policy at the University of East Anglia and a former economist at the OECD, on behalf of 1,566 app developers.
“Apple’s charges to app developers are excessive, and only possible due to its monopoly on the distribution of apps onto iPhones and iPads,” Ennis said in a statement.
“The charges are unfair in their own right, and constitute abusive pricing.”
Ennis argues that excessive commissions also harm consumers, by pushing up the prices of apps.
Follows earlier mess-up by the UK competition watchdog
The appeal has been filed with the Competition Appeal Tribunal – which recently threw out another antitrust claim against Apple by the UK competition watchdog, the CMA.
The Competition and Markets Authority (CMA) last year found that Apple had two anti-competitive policies, but was unable to take any action against the company because it missed a deadline.
Bizarrely, the case hinged on the legal definitions of two rather ordinary-sounding words: study and shall.
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