Apple and its App Store have been the subject of criticism and lawsuits, due to the high commissions they charge and their restrictions. Although a few years ago Apple halved the commission for small developers, it now faces a new complaint. This time by the British court, which filed a request for anti-competitive practices of the app storewhich could cost the company a fine of $1.8 billion.
A UK court has granted a Class Action Order (CPO) to Apple. A CPO is an order of dispute group similar to class action what they do in United States. It would affect 19.6 million consumers of the company in the British country and would entail an expenditure of £1.5 billion at Apple.
Lawsuit stems from accusation that Apple’s App Store has dominance
This CPO was presented by Dr. Rachel Kent, Professor of Economics and Digital Society Education at King’s College London. She has worked in the private consultancy sector and the NHS, saying she has researched user interaction on digital platforms.
“Essentially, Dr. Rachel Kent argues that Apple excluded the whole competition potential or actual competitors through its restrictive terms and conditions and other restrictions imposed in iOSso that it is dominant (occupies a position of monopoly) in the distribution of payment applications and services”.
He further adds that the developers are required to follow normative of the company, indicating that Apple is loading more to users with iOS devices. Given the situation, Apple strongly disagrees with all of this, of course. Therefore, ask for cancelation from judgement or alternatively, a brief judgment around this position antitrust he exercises and the excessive prices he imposes.
They claim that Apple generates overbilling thanks to its store
Although the initial filing of this class action lawsuit against Apple dates back to May 11, 2021, the request for annulment and short essay of Apple were summoned on May 4 and 5, 2022. This indicates that the case is still ongoing, since the UK court has refuse both requests from Apple. Given this, it can be considered that the lawsuit is continuing and could cost Apple dearly.
According to the expert in economy According to Dr Kent, the case would cost Apple between $600,000 and $1,800 million, affecting 19.6 million iOS users in the UK. As arguments against Apple, numerous complaints from developers and a report on costs and net revenue from the App Store. In these they indicate that there is growth profit margin and this is due to a case of price abuse and overcharging. Apple denies the facts and repeats statements it made last year:
“We believe this claim is without merit and welcome the opportunity to discuss with the court our unwavering commitment to consumers and the many benefits the App Store has brought to the UK innovation economy. “
“The fees charged by the App Store are in line with those charged by all other digital marketplaces. In fact, the 84% of the Apps from the App Store are free and the developers pay nothing to Apple. And for the vast majority of developers who pay Apple a commission because they are selling a digital good or service, they are entitled to a commission rate of 15 percent“.