Defend Apple, Microsoft, and the DOJ in the NJ District Court in the Apple-Macaulay U.S. Consumer Competition Supremum
At a press conference on Thursday announcing the lawsuit, DOJ Deputy Attorney General Lisa Monaco said Apple has maintained “a chokehold on competition” and “smothered an entire industry” through its shift from “revolutionizing the smartphone market to stalling its advancement.” Kanter added that Apple was a “significant beneficiary” of the DOJ’s suit against Microsoft over 20 years ago, and this case aims “to protect competition and innovation for the next generation of technology.”
The case is being brought in the US district court for the district of NJ. The DOJ joined the attorneys general from many states in the complaint.
US Attorney General Merrick Garland acknowledged the resource imbalance the government is up against, facing a company worth trillions of dollars. When we have an institution with a lot of resources that is hurting the American economy, we should allocate them to the people who need them the most. Individual Americans have no ability to protect themselves.
Apple’s influence on the global tech giants: a congressional analysis of the 2020 report by a House subcommittee
Some developers were able to get the ear of Congress as a House subcommittee carried out its own investigation of the tech giants a few years ago. The panel that produced the 2020 report found that Apple held a lot of sway in the market for app distribution. The American Innovation and Choice Online Act was introduced to prevent large platforms like Apple from giving their own products an advantage over competitors on their marketplaces. They have yet to receive a vote from the floor of either chamber more than two years after they were introduced.
Europe is ahead of the US when it comes to trying to rein in tech. It instituted new rules that will place a check on the power of the large platforms that are operated by Apple. The European Commission fined Apple nearly $2 billion for its app store practices. The EU said its investigation found that “Apple bans music streaming app developers from fully informing iOS users about alternative and cheaper music subscription services available outside of the app.”
The Department of Justice went to trial against the parent company of search engines in the fall of a year ago. The FTC is working on a lawsuit against Amazon.
Apple is worth nearly $3 trillion, making it one of the highest valued companies in the world. The company’s iPhones dominate the global market, according to a market analyst firm. The Justice Department alleges it’s by no coincidence that Apple was able to ensure its place at the top.
An Apple Watchdog vs. the DOJ: How Apple Ends up Being More Valacious Than It Used to Be: The Apple Antitrust Dispute
The DOJ invokes the M-word when it describes “super apps,” which it calls “a kind of middleware that can host apps, services, and experiences without requiring developers to use the iPhone’s APIs or code.” They haven’t taken off in the US, the nearest thing we have is the ride-sharing app, which you can use to request a ride, book a meal or reserve an e-bike. But true super apps as they exist in other markets just aren’t a thing here, no doubt in part because Apple doesn’t allow them on iOS. The DOJ argues that this is because Apple sees them as a threat to its platform — and that Apple blocking them is a major impediment to innovation.
Under the Biden administration, the Justice Department and the Federal Trade Commission have filed antitrust lawsuits against several leading tech companies.
When asked about the threat the new antitrust lawsuit might pose to Apple’s business, a DOJ official noted that “there are actually examples where companies, after having been charged and had to change business practices because they violated the antitrust laws in the long run, end up being more valuable than they were before.” Microsoft, thanks to its success in cloud services and more recently AI, is now the most valuable company in the world.
The DOJ initially tried to break Microsoft up into two companies. That didn’t happen, but Microsoft walked away from the trial with a list of “prohibited conduct” that prevented the company from engaging in anticompetitive shenanigans with manufacturers and developers. The whole thing is recounted in a novel by Wired.
Apple has long argued that keeping its mobile operating system, app store, and other services closed offers greater security and safety for customers. According to Newman, the DOJ complaint shows that the goal is to protect users, and that Apple does not enforce the policies consistently.
A reminder to Apple is inside the US Department of Justice’s antitrust complaint against the company.
The Department of Justice is absolutely correct that Apple benefited from the result of the United States v Microsoft case. Take section 26 of the complaint:
It goes on to detail how iTunes initially only worked on Mac computers; after the consent decree, Apple developed a version for Windows, and the iPod started going gangbusters. The rest is… history? I’m not really sure Apple owes the DOJ a thank-you card for making the iPhone possible, but not having to deal with Microsoft’s bullying along the way didn’t hurt.
The DOJ v Apple case is similar to the Microsoft case. The heart of US v. Microsoft was Microsoft’s control over middleware, the software that allows other software to run on the operating system. The DOJ concluded that Microsoft used various bullying tactics to keep other companies from developing middleware that would compete with or draw developer attention away from its own platforms — threatening to stop cooperating with Intel when it tried developing platform-level software and undermining Java development, while dissuading its allies from working with Sun Microsystems. Real bad-guy stuff!
“Disintermediation” of PCs is what Microsoft feared, and the DOJ alleges it’s what Apple fears for the iPhone. Microsoft was right to be afraid, and it seems that Apple is too.