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Developers sue Apple over App Store ‘monopoly’

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Via Yahoo Finance

Apple has been sued by app developers who claim the company’s App Store constitutes an illegal monopoly, enabling the company to charge the developers an inflated fee on app sales.

The two developers, which are seeking to launch a class action suit against the iPhone maker, say Apple exercises unfair control over how apps are downloaded on its iPhones by shutting out rivals to its App Store.

They say this unfairly forces developers to pay Apple’s the 30pc fee it levies on sales of their apps, as well as stick to mandated price points that require them to sell apps at a price ending in .99.

“From the outset, Apple attained monopoly power in the US market for iOS app and in-app-product distribution services by slamming the door shut on any and all potential competitors. And it has barred the door ever since,” according to the complaint filed in a court in California.

The developers, which make a baby-naming app and a basketball app, are seeking damages and an order banning Apple from anticompetitive behaviour.

The lawsuit is the latest legal challenge to the App Store, which is under growing scrutiny from regulators. Earlier this year the US Supreme Court ruled that a long-running lawsuit from Apple users, claiming the company operates the App Store as a monopoly, can go ahead.

The European Union is also investigating the App Store after a complaint from music streaming service Spotify, which says Apple’s fees and its rules constitute an abuse of power.

This week reports claimed that America’s Department of Justice had been granted authority to investigate Apple on antitrust grounds and the House Judiciary Committee said it would investigate competition in digital markets.

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The probe is likely to include Apple as well as the likes of Google, Facebook and Amazon which are also facing competition scrutiny in the US.

Apple did not respond to a request for comment on the lawsuit, but has defended the App Store in recent days, saying it welcomes competition.

The company’s chief executive Tim Cook said on Tuesday that Apple was not a monopoly. “I don’t think anybody reasonable is going to come to the conclusion that Apple’s a monopoly,” he told CBS. “Our share is much more modest. We don’t have a dominant position in any market.”

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