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On March 21, the New Jersey Federal Court filed a case against Apple Inc.
Claims Against Apple Inc.
Apple Inc. is charged with an antitrust lawsuit claiming its app market (App Store) rules and “monopoly” are illegally killing all the competition and restricting innovation in the space. The prosecutor claims that Apple holds a monopoly in the production and sale of smartphones, and it has previously forced developers to use its payment system to lock in both developers and users on its platform.
The case was filed in the New Jersey Federal Court with the support of sixteen state attorney generals.
What Led To The Allegations
A series of shapeshifting rules and restrictions have been imposed by Apple’s App Store guidelines and developer agreements. This allows Apple to charge higher fees and restricts innovation. Moreover, it offers a less secure or degraded user experience. It also strangles competitive alternatives, per the prosecutors.
This is a probable reason that many of the crypto based applicatons does could not offer all of their functionalities in iOS devices.
The prosecutors stated, “Apple’s anticompetitive conduct not only limits competition in the smartphone market, but also reverberates through the industries that are affected by these restrictions, including financial services.”
They further added that Apple’s policies have prohibited alternative payment system and have become anti-competitive and exclusionary.
30% Apple Tax Restricting Introduction Of Crypto For Its In-App Payments
The lawsuit filings highlighted the Apple tax rate of 30%; it is the company’s charge for application and in-application payment for the product, content, or service that the company did not develop.
The Apple payment and fee system is compatible with fiat currencies only and has prohibited the use of crypto in apps. If not completely restricted, it would be economically unfeasible for a crypto-based application to facilitate in-app purchases.
Apple offers certain enterprise and public sector customers the ability to offer their own applications through custom app stores, but iPhone users and developers are restricted from such alternative app stores as they would compete with the Big Tech player’s fees.
The DOJ said, “Apple often enforces its App Store rules arbitrarily. And it frequently uses App Store rules and restrictions to penalize and restrict developers that take advantage of technologies that threaten to disrupt, disintermediate, compete with, or erode Apple’s monopoly power.”
Companies Affected By Apple’s Policies
OpenSea and other nonfungible token (NFT) marketplaces, have disabled functionality on their iOS apps as NFT sales are subject to the 30% fee.
Damus, the Bitcoin friendly social app, had to kill a tipping feature used in Bitcoin after the delisting of apps in Apple because it was not an in-app payments function, where it takes a cut.
Web apps based online, available through a web browser and outside the App Store are still under Apple’s control, as the firm requires all iOS web browsers to use its WebKit browser engine.
The DOJ also claimed that Apple denied access to competing digital wallets that would provide an extended range of updated features and restricted developers from offering their payment system to their customers.
Apple Inc On The Lawsuit
A spokesperson from Apple Inc. has told reporters that the DOJ has accused the company wrongly based on the laws and facts, and they will definitely defend against it. The company is claiming that the allegations will be dangerous as it will give the government the upper hand in designing technology for people.
The Digital Markets Act of the European Union has forced Apple to offer alternative browser engines, payment functions and app stores. The company claims that it still has an approval process, as it claims the new options threaten user privacy and security.
Adarsh Singh is a true connoisseur of Defi and Blockchain technologies, who left his job at a “Big 4” multinational finance firm to pursue crypto and NFT trading full-time. He has a strong background in finance, with MBA from a prestigious B-school. He delves deep into these innovative fields, unraveling their intricacies. Uncovering hidden gems, be it coins, tokens or NFTs, is his expertise. NFTs drive deep interest for him, and his creative analysis of NFTs opens up engaging narratives. He strives to bring decentralized digital assets accessible to the masses.
