Taking a page out of the Big Tech Antitrust Defendant Playbook, Apple continues to drag its feet as the U.S. Department of Justice and 20 state attorneys general attempt to hold the company accountable for violations of antitrust law. Nearly 20 months in, the case is still in the preliminary stages as the parties wrangle about discovery.
Having seen how Judge Mehta narrowly crafted his Search remedies to take into account changes in technology (notably the rise of generative artificial intelligence) and the FTC’s recent loss challenging Facebook’s prior acquisitions of Meta and Instagram, Apple’s play is to delay long enough for the technology to change and allow their anticompetitive conduct to take new forms.
Like product hopping in the IP context, where patent holders introduce new formulations as patents approach expiration to extend their monopolies, the new strategy seems to be “monopoly hopping,” where the Big Tech monopolies leverage their current dominance to monopolize the new emerging markets, forever escaping real accountability. This may be Apple’s strategy in refusing to produce relevant documents related to the antitrust case.
The DOJ first brought its antitrust case against Apple in March 2024, accusing the company of anticompetitive conduct as it relates to third-party apps and hardware. First, Apple intentionally degrades the user’s experience on third party apps and third-party devices like smartwatches to push consumers to Apple’s own alternatives. Second, Apple imposes supracompetitive fees (often 30%) on third-party apps to effectively raise their price, making them less competitive in the first place. Thus, you have what DOJ would call technical and contractual restrictions to suppress competition.
For example, Garmin could make a watch that pairs with iMessage for texting, but Apple doesn’t Garmin have access to the backend code of the iPhone to make that possible, which pushes consumers to the Apple Watch. The Apple Watch should succeed or fail against competitors like Garmin on the merits, not because Apple refuses to allow integration.
Apple made its frustration with DOJ’s suit clear back in July, excerpted below:
“This lawsuit seeks to attack a random collection of Apple’s design choices, degrade the privacy and security benefits of iPhone that customers value, and eliminate the competitive differentiation and consumer choice that currently exist in the marketplace…DOJ is wrong…Apple has made careful and deliberate decisions [that are] focused on optimizing customer experience.”
The DOJ’s case, however, does not attack “a random collection of Apple’s design choices.” It attacks Apple’s technical and contractual restrictions that suppress competition. In addition, Apple’s rebuttal that it is promoting “privacy and security” on the iPhone ring hollow. You don’t need to go through an App Store on the MacBook to download applications, though the same purported privacy and security concerns would apply. Rather, Apple is protecting the App Store monopoly on the iPhone to protect a $40 billion annual revenue stream.
As The Verge’s Alex Cranz explained, the DOJ is not trying to stop Apple from vetting the security features of third party apps before they appear on the App Store to protect users. DOJ is going after Apple’s “exclusionary conduct” – the intentional user experience degradation and the extortionate fees that Apple levies against third-party app developers to suppress competition. Apple’s proffered security and privacy justifications are pretextual and would not excuse its violations of the antitrust laws.
Meanwhile, lawmakers on Capitol Hill have turned their attention to Apple to fix some of the same problems legislatively that the DOJ case has highlighted. Representative Kat Cammack from Florida, for example, has introduced the App Store Freedom Act, which she says “seeks to promote competition and protect consumers and developers in the mobile app marketplace by prohibiting certain anti-competitive practices by dominant app store operators.” Every elected official in Congress should support that legislation.
On the Senate side, Senators Marsha Blackburn and Amy Klobuchar have reintroduced the Open App Markets Act, which “prohibits a covered company from requiring developers to use an in-app payment system owned or controlled by the company as a condition of distribution or accessibility,” and Senator Mike Lee and Representative John James have reintroduced the App Store Accountability Act.
Since free markets spur innovation, increase competition, and lower prices, Apple’s days of behaving like an unchecked monopoly must come to a close. It may take years for the DOJ case to proceed to an actual trial, and Apple may have moved on to new anticompetitive conduct to preserve its monopolies. Nevertheless, all consumers should applaud the efforts by antitrust enforcers and legislators to combat Apple’s anti-competitive practices, which ultimately harm consumers both in terms of fewer choices and higher prices.
Brandon Kressin is the executive director of the Coalition for a Competitive Mobile Experience and the founding partner of Kressin Powers, a law firm focusing on antitrust litigation.
