DOJ sues Apple accusing it of monopolizing the smartphone industry
The Justice Department, with 16 state and district attorneys general in tow, has filed an antitrust suit against Apple charging the tech giant with monopolizing the smartphone industry. By placing restrictions on iOS, Apple is accused of forcing consumers to pay higher prices. The suit lists several allegations made against Apple including one that says Apple prevents the development of "super apps" that make it easier for consumers to switch between mobile platforms.
According to NBC News, the Justice Department adds that Apple blocked the development of cloud-streaming apps that would allow users to play high-quality video games without having to purchase additional hardware. The DOJ also states that Apple has inhibited the development of cross-platform messaging apps so that consumers would have to continue to buy iPhones. It should be noted that this is not a criminal lawsuit against Apple.
Attorney General Merrick Garland said during a news conference this morning, "Consumers should not have to pay higher prices because companies violate the antitrust laws. If left unchallenged, Apple will only continue to strengthen its smartphone monopoly. The Justice Department will vigorously enforce antitrust laws that protect consumers from higher prices and fewer choices. That is the Justice Department’s legal obligation and what the American people expect and deserve."
Apple is accused by the Justice Department of using iOS to monopolize the smartphone industry
Garland also told CNN, "Apple undermines apps, products, and services that would otherwise make users less reliant on the iPhone. Apple exercises its monopoly power to extract more money from consumers, developers, content creators, artists, publishers, small businesses, and merchants, among others."
Apple responded to the news today with the following statement, "At Apple, we innovate every day to make technology people love —designing products that work seamlessly together, protect people’s privacy and security, and create a magical experience for our users," it said. "This lawsuit threatens who we are and the principles that set Apple products apart in fiercely competitive markets. If successful, it would hinder our ability to create the kind of technology people expect from Apple—where hardware, software, and services intersect. It would also set a dangerous precedent, empowering government to take a heavy hand in designing people’s technology. We believe this lawsuit is wrong on the facts and the law, and we will vigorously defend against it."
DOJ Antitrust Division Chief Jonathan Kanter also left a statement that summed up the Justice Department's allegations. "For years, Apple responded to competitive threats by imposing a series of 'Whac-A-Mole' contractual rules and restrictions that have allowed Apple to extract higher prices from consumers, impose higher fees on developers and creators, and to throttle competitive alternatives from rival technologies," Kanter said.
Apple's shares have plunged today on the news with the stock currently down $7.79 or 4.36% to $170.88.
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