A Department of Justice (DOJ) investigation into Apple, dating back to 2020, is reportedly being amped up. Numerous published sources are saying the DOJ is requesting more documentation from Apple and some of their hired consultants.
The Wall Street Journal reported the escalation of the DOJ anti-trust lawsuit into Apple on Wednesday. The ramping up of the DOJ anti-trust lawsuit is focused upon alleged anti-competitive practices.
Two specific Apple products are being investigated included third-party apps on devices. In question are whether or not third-party apps on Apple devices favor the company’s operating system and the policies of third-party apps.
The initial antitrust investigation was first created by the DOJ stage attorney general into the Apple App Store, after numerous developers complained of Apple’s alleged anticompetitive behavior. New reports, according to the Wall Street Journal, signify a major sea change, with the DOJ drafting a possible antitrust compiling against the company, and probing relationships with some of Apple’s third party users.
The Apple App Store is the one-stop-shopping app for any product or service for all of the Apple devices, such as iPhones, iPads and Apple Watch. But besides being designed by App developers, third party developers, such as Microsoft and Facebook, are free to create for the Apple App Store.
The Apple App Store is a global sensation, with over 2 million Apps in the store and more than 100 billion apps downloaded. In 2023, Apple reported that there are over 650 million global visitors to the App Store weekly, bringing in over $320 billion in revenue, generated for developers since its launch in 2008.
The new US DOJ probe may mirror another set of investigations from across the pond.
Apple has been under investigation by the European Commission. The Apple App Store was scrutinized by the EU in numerous countries for the company’s polices in regard to their behavior against competitors.
In the US, the DOJ and a coalition of attorney generals have been reported to be speaking to companies about Apple’s behavior towards competitors. Detractors of Apple polices claim that the company’s 30 percent commission on all Apple App Store product and services’ sales is unfair.
In an interview with Politico, former DOJ staff member Gene Kimmelman, who worked in the Antitrust Division, told Politico that large companies who are giants in their industry are often viewed as “harmful” to competition.
"It's one thing to structure your services in a restrictive way or use exclusive contracts when you're small," said Kimmelman, in a Politico interview. "But the bigger you become, the more dominant you become in a market, the more likely those types of restrictions — unless they are absolutely essential to benefit consumers — will be viewed skeptically as harmful to competition.”
Being accused of acting unfairly with competitors is nothing new for Apple.
In 2019, the US House of Representatives Judiciary Committee requested specific information from music tech giant Spotify, about Apple’s alleged anti-competitive behavior and how it may have impacted Spotify’s business. At the time, Spotify claimed Apple "gives themselves unfair advantages at every turn.”
The European Commission, in 2020, launched two investigations in antitrust probes into Apple Play and The Apple App Store.
"It appears that Apple sets the conditions on how Apple Pay should be used in merchants' apps and websites," said EU Executive Vice-President Margrethe Vestager in a statement. "It also reserves the "tap and go" functionality of iPhones to Apple Pay.”
In a published letter Apple commented about the ongoing European probes.
"It is disappointing the European Commission is advancing baseless complaints from a handful of companies who simply want a free ride, and don't want to play by the same rules as everyone else,” said Apple in a statement.
The US antitrust law was created by three pieces of legislation: the Sherman Antitrust Act, the Federal Trade Commission Act, and the Clayton Antitrust Act. The core of these laws is to protect rules of the competitive marketplace.
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