OKLAHOMA CITY (OBV) – Oklahoma signed onto a multistate coalition that joined the U.S. Department of Justice in filing an antitrust lawsuit against Apple for allegedly monopolizing smartphone markets.
The Justice Department and a 16-state coalition filed a civil antitrust lawsuit against Apple in the U.S. District Court for the District of New Jersey over the company’s alleged monopolization of smartphone markets, a violation of Section 2 of the Sherman Act.
The lawsuit states that Apple illegally maintains a smartphone monopoly by selectively imposing contractual restrictions on developers and withholding critical access points from them as well.
“Apple undermines apps, products, and services that would otherwise make users less reliant on the iPhone, promote interoperability, and lower costs for consumers and developers,” Justice Department officials said. “Apple exercises its monopoly power to extract more money from consumers, developers, content creators, artists, publishers, small businesses, and merchants, among others.”
The Justice Department and states attorneys general filed the lawsuit in pursuit of restoring competition to smartphone markets on behalf of the American public.
“Consumers should not have to pay higher prices because companies violate the antitrust laws,” said U.S. Attorney General Merrick B. Garland. “We allege that Apple has maintained monopoly power in the smartphone market, not simply by staying ahead of the competition on the merits, but by violating federal antitrust law. If left unchallenged, Apple will only continue to strengthen its smartphone monopoly. The Justice Department will vigorously enforce antitrust laws that protect consumers from higher prices and fewer choices. That is the Justice Department’s legal obligation and what the American people expect and deserve.”
Oklahoma Attorney General Gentner Drummond singed Oklahoma onto the multistate coalition.
The lawsuit alleges Apple’s anticompetitive conduct has taken the following forms:
- Blocking Innovative Super Apps. Apple has disrupted the growth of apps with broad functionality that would make it easier for consumers to switch between competing smartphone platforms.
- Suppressing Mobile Cloud Streaming Services. Apple has blocked the development of cloud-streaming apps and services that would allow consumers to enjoy high-quality video games and other cloud-based applications without having to pay for expensive smartphone hardware.
- Excluding Cross-Platform Messaging Apps. Apple has made the quality of cross-platform messaging worse, less innovative, and less secure for users so that its customers have to keep buying iPhones.
- Diminishing the Functionality of Non-Apple Smartwatches. Apple has limited the functionality of third-party smartwatches so that users who purchase the Apple Watch face substantial out-of-pocket costs if they do not keep buying iPhones.
- Limiting Third Party Digital Wallets. Apple has prevented third-party apps from offering tap-to-pay functionality, inhibiting the creation of cross-platform third-party digital wallets.
The complaint also states that Apple’s practices impact web browsers, video communication, news subscriptions, entertainment, automotive services, advertising, location services and more.
Apple generated annual net revenues of $383 billion and a net income of $97 billion in fiscal year 2023. Its net income is higher than any other company in the Fortune 500 and the gross domestic products of more than 100 countries, according to Justice Department officials.
Apple must be held accountable, Deputy U.S. Attorney General Lisa Monaco said.
“No matter how powerful, no matter how prominent, no matter how popular — no company is above the law,” Monaco said. “Through today’s action, we reaffirm our unwavering commitment to that principle.”
Apple has used unfair practices against its competition, according to Acting Associate U.S. Attorney General Benjamin C. Mizer.
“When corporations engage in anticompetitive conduct, the American people and our economy suffer,” Mizer said. “Today’s action against Apple sends a strong signal to those seeking to box out competitors and stifle innovation — that the Justice Department is committed to using every tool available to advance economic justice and root out anticompetitive practices, wherever they arise.”
Apple’s business practices have taken advantage of consumers, said Assistant Attorney General Jonathan Kanter of the Justice Department’s Antitrust Division.
“For years, Apple responded to competitive threats by imposing a series of ‘Whac-A-Mole’ contractual rules and restrictions that have allowed Apple to extract higher prices from consumers, impose higher fees on developers and creators, and to throttle competitive alternatives from rival technologies,” Kanter said. “Today’s lawsuit seeks to hold Apple accountable and ensure it cannot deploy the same, unlawful playbook in other vital markets.”
