US Antitrust

DOJ files antitrust lawsuit against Apple alleging company monopolized smartphone market

Author: Editors Desk, HANNAH FRYSTAFF WRITER Source: Los Angeles Times
March 21, 2024 at 11:02
Customers shop at the Apple Store at the Glendale Galleria. (Michael Owen Baker / For The Times)
Customers shop at the Apple Store at the Glendale Galleria. (Michael Owen Baker / For The Times)

The Justice Department’s long-gestating lawsuit takes aim at Apple’s biggest cash cow.

The U.S. Justice Department on Thursday filed a sweeping antitrust lawsuit against Apple alleging that the technology giant attempted to monopolize the smartphone market to boost its business.

The complaint, filed in the U.S. District Court for the District of New Jersey, alleges that Cupertino, Calif.-based Apple illegally maintains a monopoly over smartphones by “selectively imposing contractual restrictions on, and withholding critical access points from, developers,” according to a press release from the Department of Justice.

The lawsuit also alleges that Apple undermines apps, products and services that would make customers less reliant on iPhones. The lawsuit seeks to restore competition in the tech market to protect customers from higher prices and expand their product choices, Atty. Gen. Merrick Garland said in a prepared statement.

IPhones are the most popular smartphone in the United States, accounting for more than 60% of sales, analysts say. Its main competition comes from phones made by Samsung and other manufacturers that run Alphabet’s Android operating system.

“Consumers should not have to pay higher prices because companies violate the antitrust laws,” Garland said in a prepared statement. “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.”

Apple generated annual net revenues of $383 billion in 2023 and a net income of $97 billion. IPhone sales made up the largest chunk of the company’s revenue in its most recent quarter.

The Justice Department last sued Apple in 2012, accusing the company of colluding with book publishers to fix e-book prices. Apple was required to pay a $450-million settlement in the case.

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