Apple
is being sued for $1 billion in the UK by more than 1,500 app developers
app store
Fees. The class action lawsuit alleges that the fees charged by Apple are unlawful and anticompetitive.
Apple’s services business, which includes the App Store, has been growing rapidly and is now worth about $20 billion a quarter, Reuters news agency reported. The developers are seeking $1 billion in damages and the lawsuit will be brought before the Competition Appeal Tribunal.
Apple charges commissions of 15% to 30% from some app makers for using an in-app payment system. The system has been criticized by app developers and antitrust authorities in several markets and regions.
“Apple’s fees to app developers are inflated and only possible because of Apple’s monopoly on app distribution on iPhones and iPads,” said Sean Ennis, a professor at the University of East Anglia’s Center for Competition Policy, who filed the lawsuit on behalf of 1,566 app developers.
Apple has argued that 85% of developers don’t pay commission on the App Store. It also said the fees will help developers in the Europe region access markets and customers in 175 countries around the world through the platform.
“The fees are inherently unfair and abusive pricing. They hurt app developers and app buyers alike,” Ennis added.
Apple allows competing apps on iPhones
In March of this year, it was reported that Apple was preparing to allow alternative app stores on its iPhones and iPads, in line with new European Union guidelines
Digital Markets Act
(DMA). The law, which will come into effect in 2024, will force OEMs to allow users to install third-party apps on their devices.
This means that Apple cannot charge a commission of up to 30% on all payments. The rule also applies to
which also charges up to 30% commission for using its in-app payment system
Google play store
.
Fines on Google
Antitrust authorities in several markets have also fined Google in similar cases. In India, the Competition Commission of India (CCI) fined Google Rs 936 crore in October. The regulator said the company must allow third-party use of invoicing.
Google later introduced the User Choice Billing (UCB) scheme, which requires app developers to pay 11-26% commission to the company. However, some startups have filed lawsuits against the company for allegedly failing to comply with an antitrust rule.
