US Department of Justice has filed a lawsuit against the iPhone manufacturer with allegations of violation of antitrust rules, and the EU is preparing an investigation into non-compliance with the Digital Markets Law.
As noted by Bloomberg, on Thursday, Apple shares fell by 4.1%, reducing the company’s market value by about $113 billion. At the beginning of 2024, the iPhone maker had the status of the most expensive company in the world, with a capitalization above $3 trillion.
This is not the first time Apple has come under scrutiny by regulators: it has been accused of enriching itself by suppressing competitors for years. However, the company has become increasingly popular over the years, so the authorities are becoming more aggressive and wary of its power.
A US lawsuit filed on Thursday in a New Jersey federal court accuses Apple of blocking competitors from accessing hardware and software features on its devices. Potential investigations in Europe will focus on new commissions of the company, terms, and conditions for developers of alternative app stores.
Apple responded to the US lawsuit, calling it «incorrect in terms of facts and law», and promised to «vigorously defend itself».
The US lawsuit alleges that Apple used its power over the distribution of iPhone apps to impede innovations that would make it easier for consumers to customize their phones. According to the Department of Justice, the company has refused to support cross-platform messaging applications, limited third-party digital wallets and smartwatches, and blocked mobile cloud streaming services.
The EU Digital Markets Act, which contains a number of prohibitions for some of the world’s largest technology platforms, allows for significant fines of up to 10% of a company’s total annual global revenue and up to 20% for companies that repeatedly violate the rules. Following the launch of formal investigations into Apple and Alphabet, the regulators promised to provide their final decisions within 12 months.
Apple has only recently received a fine of almost $2 billion from the EU following Spotify’s complaint about blocking the ability of third-party music streaming programs to inform users about cheaper offers.