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This is an archive article published on March 23, 2024

US vs. Apple: 5 key takeaways from the DOJ’s antitrust showdown

The US government is taking on Apple's entire ecosystem of devices, software, and services. We break down the huge implications from this high-stakes antitrust fight.

apple logoApple published its earnings for the third quarter on August 1. (Image source: Unsplash)

The US Department of Justice just unleashed an epic 88-page antitrust lawsuit against Apple, accusing the iPhone maker of illegally fortifying its mobile monopoly. This case could reshape the tech landscape as we know it. Here are five major takeaways.

1. Apple and the industry reacts

Apple fired back hard, claiming the suit “threatens who we are” and could “hinder our ability to create the kind of technology people expect.” In other words, they’re doubling down on the integrated hardware-software experience that’s core to their products. You can find Apple’s complete stance in our previous explainer.

Other tech players wasted no time voicing their opinions. Nothing CEO Carl Pei resurfaced old Steve Jobs emails revealing Apple’s brutal “lock customers into our ecosystem” strategy.

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“iPhone’s 60%+ total market share, and 90% market share for 18 and below in the US, coupled with their walled garden strategy is what kept us from entering the US with full force. This lawsuit is the start of something very big,” he tweeted.

And the Coalition for App Fairness, including Epic Games and Spotify, cheered the DOJ for finally taking on Apple’s “stranglehold” over mobile apps. “The DOJ complaint details Apple’s long history of illegal conduct – abusing their App Store guidelines and developer agreements to increase prices, extract exorbitant fees, degrade user experiences, and choke off competition,” reads an excerpt from the statement.

2. What it could mean for users

In the short term? Not much. If past cases like the antitrust cases by the DOJ against Microsoft and Google are any indication, this’ll likely take years to play out. But if the DOJ ultimately prevails, it could mean cheaper app subscriptions, alternative payment options beyond Apple’s commission, more freedom for developers on the App Store, and greater overall choice for consumers.

Those prospective wins are why groups like the Coalition for App Fairness are emboldened.

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3. The green bubble stigma

The DOJ spent quite some time talking about the green bubble-blue bubble issue in its case. It alleged that Apple deliberately degraded messaging between iPhones and Android phones to make the latter seem like an inferior choice – especially for teenagers, 85% of whom are on iPhones in the US.

imessage apple featured The DOJ spent quite some time talking about the green bubble-blue bubble issue in its case. (Image: Zohaib Ahmed/The Indian Express)

The lawsuit cites examples like Apple execs saying “moving iMessage to Android will hurt us more than help us.” It even calls out Tim Cook’s flippant “buy your mom an iPhone” remark when a customer complained about cross-platform messaging issues.

According to the DOJ, this manufactured friction and “green bubble” stigma misleads consumers into thinking Android is subpar, when really it’s just Apple doing the restricting for its own interests.

4. Parallels to the Microsoft case

On its surface, this lawsuit evokes the 1998 case that stopped Microsoft’s monopolistic behaviour with Windows desktop software. But there are key contrasts too.

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While Microsoft overwhelmingly dominated PC operating systems back then, Apple’s market position is less absolute today with viable mobile competition from Android (though iPhones do lead in the US).

So the DOJ may find it trickier to prove Apple is an outright illegal monopoly. That said, a win could open up mobile platforms similar to how Microsoft had to give third-parties more access and choice within Windows.

5. Bigger picture of tech scrutiny

Apple is just the latest in a series of major antitrust crackdowns on US tech giants like Google, Amazon, Meta, and Microsoft over anti-competitive practices.

Under the Biden administration in particular, the authorities have ramped up challenges against these companies’ roles as powerful “gatekeepers” controlling access to customers, platforms, and data.

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It’s part of a global reckoning, with other governments from Europe to Asia-Pacific also taking stringent actions to rein in Big Tech’s dominance across multiple markets and industries.

For Apple specifically, the DOJ probe started way back in 2019 but expanded into this broader case attacking their entire ecosystem of products and services – going beyond the relatively narrower App Store battles global regulators have picked so far.

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