The Justice Department is suing Apple over its alleged iPhone monopoly
The Justice Department sued tech giant Apple on Thursday, kicking off a potentially historic antitrust battle. The lawsuit alleges that Apple’s ecosystem of products are designed to limit competition and put consumers at a disadvantage. “Each step in Apple’s course of conduct built and reinforced the moat around its smartphone monopoly,” the authors write. Later in the filing they add that “this case is about freeing smartphone markets from Apple’s anticompetitive and exclusionary conduct and restoring competition to lower smartphone prices for consumers, reducing fees for developers, and preserving innovation for the future.”
If the Justice Department decides to break up Apple, it will be the first time they have done this to a large company since they broke up the Bell System in 1982. Yet this is also the third antitrust lawsuit that the Justice Department has filed against Apple since 2010. Apple settled a lawsuit that alleged they had colluded to suppress workers’ salaries, and they won a trial in which they were accused of conspiracy to fix the prices of e-books. This new lawsuit, however, is much wider in scope, with prosecutors claiming the company’s “astronomical valuation” is due to anticompetitive practices in its iPhone, Apple Watch advertising, browser, FaceTime and news businesses.
Attorney General Merrick Garland said at a news conference that the Supreme Court defines monopoly power as “the power to control prices or exclude competition,” adding that “as set out in our complaint, Apple has that power in the smartphone market. If left unchallenged. Apple will only continue to strengthen its smartphone monopoly.”
Outside observers seem to agree on only one thing: The upcoming legal battle will play out over a very long time.
“Apple’s fiery response makes it clear that the company has every intention of defending itself,” writes Chris Welch of The Verge. “We’re on day one of a lawsuit that’s sure to drag on long into the future. It took over three years for the government and Microsoft to reach a settlement in that high-profile antitrust case (and another four years for dissatisfied state attorneys general to run through the appeals courts).”
Jason Snell of Six Colors, a website devoted to covering Apple and other technology companies, criticized the lawsuit and predicted that “this will be a long, drawn-out process that will end up with Apple changing some of its policies. Some of those changes will be substantial and will alter how the company operates; others will be pointless and cause no appreciable effect; and still others will degrade the experience of iPhone users without increasing competition.” As for Apple practices that allegedly stifle competition and harm consumers, they “will just go on as usual, unchanged and unchallenged.”
