Apple, the tech giant, has been hit with an extensive antitrust lawsuit by the United States Department of Justice (DOJ), accusing the company of using its app market rules and alleged “monopoly” to stifle competition and hinder innovation. The lawsuit, supported by 16 state attorney generals, was filed in a New Jersey federal court on March 21. The DOJ claims that Apple has a monopoly in the smartphone market and has used this position to “force” developers to use its payment system, thereby locking them and users into its platform. The DOJ further alleges that Apple’s App Store guidelines and developer agreements impose restrictive rules that allow the company to charge higher fees, hinder innovation, offer a less secure user experience, and limit competition. These policies have reportedly led to limited functionality for many crypto-based apps on iOS devices. The DOJ also highlights Apple’s 30% fee, known as the “Apple tax,” which it charges for apps and in-app payments that it did not create. This fee and Apple’s payment systems only support fiat currencies, effectively blocking the use of cryptocurrencies in apps or making it economically unviable for crypto-based apps to offer in-app purchases. While Apple does offer certain enterprise and public sector customers the ability to offer their own apps through custom app stores, iPhone users and developers are prohibited from accessing alternative app stores that would compete with Apple’s fees. As a result of the fees imposed by Apple, some NFT marketplaces and the Bitcoin-friendly social app Damus have had to disable certain features or remove their apps from the App Store. Additionally, Apple has been accused of denying access to competing digital wallets and prohibiting developers from providing their own payment services to their customers. In response to the lawsuit, an Apple spokesperson stated that the DOJ’s complaint is “wrong on the facts and the law” and that the company will vigorously defend itself. The spokesperson also argued that the lawsuit sets a dangerous precedent as it could give the government excessive power over technology design. In the European Union, Apple has been compelled by the Digital Markets Act to offer alternative browser engines, payment functions, and app stores. However, the company still maintains an approval process, claiming that the new options pose threats to user privacy and security. Following the announcement of the lawsuit, Apple’s shares fell by 4% to around $171.
Apple sued by US government over allegations of imposing restrictive rules on cryptocurrency apps and other services