The UK’s Competition and Markets Authority (CMA) has launched an antitrust inquiry into Apple, due to many complaints coming from developers about the iPhone maker’s App Store.
Apple released the iOS 14 late last year, the newest version of its operating system which came with new policies that have become the center of controversy between the tech giant and developers.
Apple only allows developers to release iPhone and iPad apps through its iOS smartphone platform. Apart from the rigorous process it takes for apps to be approved on iOS, Apple charges 30% on in-app transactions. The CMA said it may amount to unfair practice by the Cupertino firm.
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“Millions of us use apps every day to check the weather, play a game or order a takeaway,” Andrea Coscelli, chief executive of the CMA said.
“Complaints that Apple is using its market position to set terms which are unfair or may restrict competition and choice – potentially causing customers to lose out when buying and using apps – warrant careful scrutiny,” he added.
Recently, American and European watchdogs have increased regulatory investigations into the activities of American tech giants. Last year, the EU Commission launched antitrust investigations into Apple’s App Store rules and its Apple Pay mobile wallet. The Commission said it’s investigating whether Apple’s rules for app developers on the distribution of apps via the App Store breach EU competition rules.
Apple said it would cooperate with the CMA to address the concerns, admitting that the App Store process is rigorous.
“We believe in thriving and competitive markets where any great idea can flourish,” Apple spokesperson said.
“The App Store has been an engine of success for app developers, in part because of the rigorous standards we have in place – applied fairly and equally to all developers – to protect customers from malware and to prevent rampant data collection without their consent.”
Facebook is among the firms leading the complaints against Apple Store policies that have limited its ability to harvest private data for targeted ads. The policy forbids Facebook from accessing users’ private data without their permission. The social media company has described Apple’s new policy as anticompetitive, after several attempts to get the smartphone maker to reverse the new rules failed.
Epic Games, creator of the popular video game Fortnite is another vocal critic of Apple. Epic had filed a suit against Apple when its game was removed from the App Store for releasing and updated version that let players bypass Apple’s payment system. The game maker said Apple Store rules are anti-competitive and has particularly taken issue with the 30% cut that Apple takes from developers for in-app purchases.
Apple announced late last year it will cut the 30% commission it charges for in-app purchases to 15%, starting January, but the price reduction will only apply to developers that made up to $1 million in revenue over the past year.
Last month, Epic filed an antitrust complaint against Apple with the EU, having filed similar suits with US and Australia regulators.
A growing number of apps including Spotify and Match Group are joining the complaint against Apple. A Spotify spokesperson said the CMA’s inquiry is welcomed.
“The U.K Competition and Markets Authority joins an ever-growing list of regulators to open an investigation into Apple’s App Store practices.
“We welcome this and hope to see swift action because Apple’s anticompetitive behavior is harmful to not just Spotify but to app developers and consumers everywhere around the world,” the spokesperson said.
Apple’s App Store new policy has exposed it to escalating apathy that is now involving more apps and regulators around the world.
Last month, Facebook founder and CEO Mark Zuckerberg reportedly told staff that Facebook needs to “inflict pain” on Apple. Zuckerberg said during an earnings call last month that Apple is increasingly becoming bigger threat to Facebook by using its platform to interfere with how the social media app operates.