"Blocking Competitor Apps Illegally and Exclusively"
Apple Announces Active Defense Measures
The U.S. Department of Justice has filed an antitrust lawsuit against Apple. It viewed Apple's operation of a closed mobile ecosystem as preventing consumers from using innovative features and switching to competing products. Following the European Union (EU), Apple, cornered by antitrust allegations from U.S. authorities as well, saw its stock price fall more than 4% on the day.
On the 21st (local time), the U.S. Department of Justice filed a lawsuit against Apple for antitrust violations in the federal court of New Jersey. Attorneys general from 16 states jointly participated in this lawsuit.
The Department of Justice claimed that Apple strengthened its control over iPhone software, blocking competitors from offering innovative features. Apple only allowed its own messaging apps and payment services on the App Store, preventing the use of third-party messaging apps, digital wallets, cloud streaming services, and more. Apple has maintained a closed App Store operation strategy, citing the need to ensure safety from viruses and fraud. The Department of Justice particularly focused on how Apple blocked app compatibility with third parties, making it difficult to switch to devices running operating systems (OS) other than Apple's, such as Android. The DOJ views this as enforcing a 'lock-in effect' that led to increased consumer fees.
The Department of Justice stated, "This case aims to free the smartphone market from Apple's anti-competitive and exclusive practices," adding, "It is also to restore competition, lower smartphone prices for consumers, reduce developer fees, and preserve innovation for the future."
Merrick Garland, U.S. Attorney General, criticized, "Apple maintained its power not because of excellence but through illegal and exclusive behavior," and said, "Instead of making its own products better, it made other products worse to strengthen its monopoly." He also pointed out that Apple posted a net profit of $97 billion last year (about 130 trillion KRW), exceeding the GDP of over 100 countries, and holds a 65% market share in the U.S. smartphone market.
With this lawsuit, the U.S. Department of Justice concluded its five-year investigation into Apple's antitrust violations, which began in 2019. Additionally, U.S. competition authorities have now filed antitrust lawsuits against all four major big tech companies: Amazon, Google, Meta Platforms (Facebook's parent company), and Apple.
Apple immediately pushed back and announced an active response. In a statement, the company said, "This lawsuit is wrong based on facts and law," and argued, "It will set a dangerous precedent that allows excessive government intervention in technology design."
Apple is also under intense antitrust scrutiny in Europe. Earlier, EU competition authorities fined Apple 1.84 billion euros (about 2.67 trillion KRW) for abusing its dominance in the music streaming app market. Following the recent enforcement of the EU Digital Markets Act (DMA), Apple has modified its App Store operation strategy by allowing app downloads from developer web browsers without going through its App Store, but only in the European region starting this month.
Meanwhile, Apple's stock price fell 4.09% on the day following news of the U.S. authorities filing the antitrust lawsuit.
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