App developers sue Apple over alleged anti-competitive practices
Science & Technology ı By Cedric Dent
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Two app developers filed a lawsuit against Apple (NASDAQ: AAPL) alleging that the tech giant engaged in anti-competitive practices related to its App Store.
The plaintiffs, Donald R. Cameron of California and Pure Sweat Basketball of Illinois claimed that Apple is monopolizing app distribution citing the reason that consumers can only download iPhone apps through its official App Store.
In addition, the plaintiffs claimed that Apple is charging app developers a $99 yearly fee and 30 percent commission on the sale of apps. The iPhone maker allegedly dictates how app developers should price their apps.
“This practice is analogous to a monopsonist retailer paying artificially low wholesale prices to its suppliers. “In both paradigms a competitive market would yield better post-commission or wholesale prices, and fairer profit, for developers’ digital products,” according to the app developers in their complaint.
App developers echoed consumers' arguments in a similar lawsuit against Apple
Their allegations against Apple are similar to those highlighted in the antitrust complaint filed by consumers, who argued that that tech giant is taking excessive commission from app developers. Its practice artificially inflated the prices of iPhone apps. Consumers claimed they were overcharged for iPhone apps, which they can only purchase through the company’s App Store.
Apple questioned the legality of the complaint filed by consumers since it does not have contract with them. The company argued that its contract was with developers, who pay fees to sell their apps on the App Store.
Last month, the U.S. Supreme Court ruled that the consumers’ lawsuit against the tech giant can proceed.
The iPhone maker is confronting the lawsuits a time when federal regulators and lawmakers are escalating their investigations into possible anti-competitive practices and other violations by tech giants.
Yesterday, the House Judiciary Committee announced an antitrust investigation of the tech industry, focusing on tech giant’s market power.
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