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    4 more states join the US Government’s antitrust lawsuit against Apple’s monopoly of the smartphone market

    The Attorneys General of 4 US states, Indiana, Massachusetts, Nevada, and Washington, have joined the antitrust lawsuit against Apple for monopolizing multiple smartphone markets brought by the Department of Justice, 15 states, and the District of Columbia in March. The lawsuit alleges that Apple partook in anticompetitive conduct to maintain its monopoly in the US “performance” smartphone market and harmed consumers and app developers.

    The lawsuit aims to restore competition in the smartphone market, bring fairer conditions for developers, and an environment where innovation can thrive.

    Here are the allegations against Apple that were presented by the lawsuit to demonstrate how Apple limited competition in the market:

    1. Apple limits and degrades the functionality of third-party messaging apps on the iPhone compared to iMessage

    The lawsuit alleged that by limiting third-party messaging apps from incorporating features like SMS integration, background operation, and camera access for video calls, Apple discourages users from switching to Android devices. It also claimed that Apple is knowingly and deliberately degrading quality, privacy, and security for its users and others who do not have iPhones” by prohibiting third-party apps from sending or receiving carrier-based messages.

    Additionally, it claimed that users feel “social pressure” to buy iPhones due to the Apple Messages feature that makes non-iPhone users’ conversation appear in a green bubble with limited functionality, such as no encryption, pixelated videos, and the inability to edit messages or see typing indicators. This allegedly “creates a perception that rival smartphones are of lower quality, even though Apple is the cause of the degraded experience.”

    2. Apple impedes the development of cross-platform smartwatches

    The lawsuit alleged that by limiting key functions for third-party smartwatch features like responding to notifications, maintaining a reliable Bluetooth connection, and using the same phone number for cellular connectivity on both the iPhone and smartwatch, Apple makes alternative options appear less attractive to consumers.

    Apple also locks users into the Apple ecosystem by making the Apple Watch compatible only with the iPhone and disincentivizing users to buy a smartwatch from a different brand. The lawsuit stated, “Apple has denied users access to high-performing smartwatches with preferred styling, better user interfaces and services, or better batteries, and it has harmed smartwatch developers by decreasing their ability to innovate and sell products.”

    3. Apple restricts cross-platform digital wallets on the iPhone

    The lawsuit claimed that Apple reduced the functionality of the third-party digital wallet on the iPhone. Specifically, Apple blocks third-party apps from accessing the iPhone’s NFC hardware, which is required for tap-to-pay capabilities, something only Apple’s own Wallet app can do. The lawsuit claimed that Apple does this deliberately because “Cross-platform digital wallets would make it easier for iPhone users to switch to other smartphones.”

    The lawsuit also alleged that Apple retains the stream of income by forcing users to use only Apple-authorized products in the digital wallet. For example, Apple charges banks fees for transactions via Apple Pay, while rival digital wallets are free for banks.

    Due to these restrictions, it is unviable to invest in building some apps, like digital wallets as they cannot reach iPhone users. This lawsuit claims that such steps by Apple have impacted innovation and have denied customers “a wide variety of enhanced features”

    4. Apple restricts cloud gaming apps that reduce dependence on the iPhone’s expensive hardware

    Cloud streaming game apps provide users a way to play computing-intensive games in the cloud rather than rely on the device’s hardware. The lawsuit alleged that Apple has blocked or limited cloud streaming services because these services “reduce the need for users to buy expensive phones with advanced hardware” like the iPhone. This, it claims, “harms users by denying them the ability to play high-compute games, and it harms developers by preventing them from selling such games to users.”

    5. Apple suppresses the distribution of Super Apps that reduce user dependence on the iPhone

    Superapps like China’s WeChat, incorporate a multitude of mini-programs that might allow users to easily discover and access a wide variety of content and services without setting up and logging into multiple apps.

    The lawsuit accused Apple of preventing the distribution of such apps because they reduce dependence on iOS and the App Store as developers can host apps and services without requiring developers to use the iPhone’s APIs or code.

    All of this, they claimed threatened Apple’s control over app distribution as well as a need for the iPhone. Thus, they alleged Apple updated its App Store Guidelines to effectively block apps from hosting mini-programs.

    The hearings are set to begin in September 2024. If successful, it could have far-reaching implications for how Apple operates and could set important precedents for antitrust enforcement in the digital age. 

    Also Read:

    The post 4 more states join the US Government’s antitrust lawsuit against Apple’s monopoly of the smartphone market appeared first on MEDIANAMA.

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