Apple May Soon Encounter Extensive U.S. Antitrust Lawsuit

The United States Justice Department is in the “late stages” of an antitrust investigation into Apple that could soon lead to an antitrust lawsuit, reports The New York Times. The DoJ could be ready to file a “sweeping” antitrust case in the first half of 2024, with the agency considering how Apple’s control over hardware and software locks consumers into the Apple ecosystem and makes it difficult for rivals to compete.

Apple officials have met with the DoJ several times during the investigation, which has covered everything from iMessage to the Apple Watch. Some of the topics looked at:

  • How the Apple Watch works better with iPhone than other smart watches do.
  • How Apple locks competitors out of iMessage.
  • How Apple blocks other financial firms from offering tap-to-pay services similar to Apple Pay on the iPhone.
  • Whether Apple favors its own apps and services over those provided by third-party developers.
  • How Apple has blocked cloud gaming apps from the App Store.
  • How Apple restricts the iPhone’s location services from devices that compete with AirTag.
  • How App Tracking Transparency impacted the collection of advertising data.
  • In-app purchase fees collected by Apple.

Apple competitors like Tile, Beeper, Basecamp, Meta, and Spotify have talked with antitrust investigators, as have banks that have wanted access to the iPhone’s NFC capabilities.

The Department of Justice has not yet made a final decision about whether a lawsuit should be filed, and Apple has not yet had a chance to have a final meeting to plead its case before a lawsuit is filed.

Apple and Microsoft are the only “big five” companies not currently facing U.S. lawsuits over their business practices. Google, Amazon, and Meta are all facing off against the DoJ or the FTC.

Over the last several years, Apple has defended itself against antitrust accusations in the U.S. In 2020, the U.S. House Judiciary Antitrust Subcommittee said that Apple, Meta, Google, and Amazon have the “kinds of monopolies” last seen in “the era of oil barons and railroad tycoons.”

Apple has argued that it does not have a dominant market share in any category where it does business, and the company also often cites the opportunities and jobs provided by the App Store. If the DoJ does opt to file an antitrust lawsuit, it will likely lead to a multi-year legal battle.

Though Apple has so far avoided regulatory action in the United States, it has been struggling against antitrust rules put in place in the European Union. The Digital Markets Act (DMA) could soon force Apple to make significant chances to the App Store, Siri, Messages, FaceTime, and other services. Apple is, for example, already working to add support for sideloading apps to iPhones in Europe, functionality that we are expecting to see sometime later this year.