The federal Department of Justice has announced a landmark antitrust lawsuit against Apple, accusing the technology company of monopolizing the American smartphone market.According to The Associated Press, the lawsuit was filed on Thursday in a New Jersey-based federal court. In its complaint, the Justice Department claimed that Apple leverages the popularity of its iPhone products to “engage in a broad, sustained, and illegal course of conduct.”“Apple has locked its consumers into the iPhone while locking its competitors out of the market,” Deputy U.S. Attorney General Lisa Monaco said, suggesting that Apple’s influence has “smothered an entire industry.”The lawsuit claims alleges that Apple has intentionally suppressed the following types of applications and services:

• “Super apps,” or applications that have “broad functionality” and can be used across different devices

• Cloud streaming gaming applications

• Messaging applications, which are purportedly engineered to perform “worse generally and relative to Apple Messages”

• Smartwatches, with Apple allegedly “suppressing key functions of third-party smartwatches”

• Digital wallets

“[Apple] undermines apps, products, and services that would otherwise make users less reliant on the iPhone,” the Justice Department said in a press release.”Furthermore, the Department of Justice Claims that—while Apple has long recognized the threat posed by disruptive technologies—its strategy for protecting its market position does not involve lowering prices or improving its practices. Instead, Apple imposes “a series of shapeshifting rules and restrictions in its App Store guidelines and developer agreements.”

The Apple Store on Fifth Avenue in New York City. Image via Flickr/user:jlascar. (CCA-BY-2.0). (source:https://www.flickr.com/photos/jlascar/7181848534).

The Associated Press notes that Apple has established what is sometimes termed a “walled garden” around its most popular products, such as the iPhone, iPad, Mac, and Apple Watch.Apple, for its part, says that its “walled garden” helps the company “[design] products that work seamlessly together, [protecting] people’s privacy and security, and [creating] a magical experience for” users—an experience that the company claims privileges privacy while keeping consumers’ personal information safe.But, in its complaint, the Department of Justice suggests that Apple’s talk of “privacy, security, and consumer preferences” cloaks a wide range of overtly anticompetitive practices.“Apple selectively compromises privacy and security interests when doing so is in Apple’s own financial interest—such as degrading the security of text messages, offering governments and certain companies the chances to access more private and secure versions of app stores, or accepting billions of dollars each year for choosing Google as its default search engine when more private options are available,” the Justice Department alleges.“In the end,” the lawsuit says, “Apple deploys privacy and security justifications as an elastic shield that can stretch or contract to serve Apple’s financial and business interests.”A key claim made by the Department of Justice is that Apple’s “walled garden” does less to protect consumer privacy than to enable the company to make multibillion-dollar deals with multibillion-dollar corporations—all while stifling competition and padding its profit margins.“Consumers should not have to pay higher prices because companies break the law,” U.S. Attorney General Merrick Garland said.

Sources

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