DOJ files antitrust lawsuit against Apple accusing tech giant of monopolizing smartphone market

He cited iMessage as an example of how Apple "knowingly and deliberately degrades quality, privacy, and security for its users."

Jarryd Jaeger Vancouver, BC
On Thursday, Attorney General Merrick Garland announced that the Department of Justice along with 15 states and the District of Columbia had filed an antitrust lawsuit against Apple, accusing the tech giant of monopolizing the smartphone industry.

The AG argued that Apple had managed to dominate the market not by providing a product that everybody wants to buy, but by engaging in violations of Section 2 of the 1890 Sherman Antitrust Act, which prohibits activities that restrict interstate commerce or marketplace competition.

Garland began by pointing out that Apple's net income "exceeds the individual GDP of more than 100 companies" thanks in large part to the iPhone, adding that Apple's share of the American "performance smartphone" and smartphone markets exceed 70 and 65 percent, respectively.

"Apple charges nearly $1,600 for an iPhone," he said, "but as our complaint alleges, Apple has maintained monopoly power in the smartphone market not simply by staying ahead of the competition on the merits, but by violating federal antitrust law."

Garland alleged that Apple "has employed a strategy that relies on exclusionary, anticompetitive conduct that hurts both consumers and developers. For consumers, that has meant fewer choices, higher prices and fees, lower quality smartphones, apps, and accessories, and less innovation from Apple and its competitors."

He suggested that rather than dominating the market by making its own products better, Apple had "made other products worse."

The AG went after Apple for imposing "contractual restrictions and fees that limit the features and functionality that developers can offer users," and "selectively restrict[ing] access to the points of connection between third-party apps and the iPhone's operating system, degrading the functionality of non-Apple apps and accessories."

He cited iMessage as an example of how Apple "knowingly and deliberately degrades quality, privacy, and security for its users."

The lawsuit was filed in the US District Court for the District of New Jersey.
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