At the end of last year, we reported that a monopoly charge on the App Store would be judged in 2019 by the United States Supreme Court. To those who have no idea what we are talking about, here is a summary.
A lawsuit filed in 2011 accused Apple of operating an unlawful monopoly with the app store – the argument was that with the App Store being the only way for iPhones and iPads owners to acquire apps for their devices and considering the 30 percent charged by Apple to developers, the Cupertino giant would be actively making consumers pay more than needed by applications.
In 2013, the US District Court Judge dismissed the case alleging errors in the complaint; four years later, the US Court of Appeals reversed the ruling and sent the case to the country’s Supreme Court; today, the result came out.
In a 5-4 vote, the court ruled against Apple, allowing iPhones and iPads users to sue the company for a monopoly – as CNBC reported. Although Apple has hit the key that is not responsible for app pricing (such a decision is the responsibility of the developers/companies responsible for the apps/games), the customer argument is that this 30% after all, is passed on to the user, making everything more expensive. And as the App Store is the only way to buy apps for iGadgets …
Probably influenced by this decision and by the US-China trade war (China will increase import duties on hundreds of American products to 25% – a retaliation to the US decision to also raise Chinese product purchases tariffs by 25%), Apple shares are plummeting at the time of writing this article, dropping about 5.5%.
Here’s Apple’s statement on the subject:
Today’s decision means that plaintiffs can pursue their case in district courts. We are sure to prevail when the facts are presented and the App Store is not a monopoly on any metrics.
We are proud to have created the most secure and reliable platform for customers and a great business opportunity for all developers around the world. Developers define the price they want to charge for the application and Apple has no role in it. The vast majority of App Store applications are free and Apple receives nothing from them. The only instance where Apple shares revenue is if the developer chooses to sell digital services through the App Store.
Developers have multiple platforms for choosing how to sell their software – from other app stores, Smart TVs and game consoles – and we work hard every day to make sure our store is the best, safest, and most competitive in the world.