U.S. Supreme Court Appears 'Open' to Allowing App Store Monopoly Lawsuit vs. Apple to Proceed

U.S. Supreme Court justices "appeared open" to letting a proposed class-action lawsuit proceed against Apple that accuses the company of operating an illegal App Store monopoly, according to Reuters.

app store monopoly
The lawsuit was filed in 2011 by a group of iPhone users who believe Apple violates federal antitrust laws by requiring apps to be sold through its App Store, where it collects a 30 percent commission from all purchases, leading to inflated prices as developers pass on the cost of the commission to customers.

The bottom line is that the iPhone users, led by Chicago resident Robert Pepper, believe that apps would be priced lower outside of the App Store, as Apple's 30 percent cut would not be baked in to prices.

The lawsuit was initially dismissed in 2013 by a California district court, due to errors in the complaint, but the U.S. Court of Appeals for the Ninth Circuit revived the case in 2017. Apple appealed with the Supreme Court, which will rule whether the case should proceed after hearing an hour of arguments today.

From the start, Apple has argued that it doesn't set prices for paid apps, and that charging a 30 percent commission on the distribution of paid apps and in-app purchases does not violate antitrust laws in the United States. Last year, the U.S. Department of Justice filed an amicus brief in support of Apple.

The plaintiffs, meanwhile, are backed by 30 state attorneys general, including those representing Texas, California, and New York. The Supreme Court is expected to make its ruling by June 2019.

Popular Stories

iPhone 16 Pro Sizes Feature

iPhone 16 Series Is Just Two Months Away: Everything We Know

Monday July 15, 2024 4:44 am PDT by
Apple typically releases its new iPhone series around mid-September, which means we are about two months out from the launch of the iPhone 16. Like the iPhone 15 series, this year's lineup is expected to stick with four models – iPhone 16, iPhone 16 Plus, iPhone 16 Pro, and iPhone 16 Pro Max – although there are plenty of design differences and new features to take into account. To bring ...
iPhone SE 4 Vertical Camera Feature

iPhone SE 4 Rumored to Use Same Rear Chassis as iPhone 16

Friday July 19, 2024 7:16 am PDT by
Apple will adopt the same rear chassis manufacturing process for the iPhone SE 4 that it is using for the upcoming standard iPhone 16, claims a new rumor coming out of China. According to the Weibo-based leaker "Fixed Focus Digital," the backplate manufacturing process for the iPhone SE 4 is "exactly the same" as the standard model in Apple's upcoming iPhone 16 lineup, which is expected to...
tinypod apple watch

TinyPod Turns Your Apple Watch Into an iPod

Wednesday July 17, 2024 3:18 pm PDT by
If you have an old Apple Watch and you're not sure what to do with it, a new product called TinyPod might be the answer. Priced at $79, the TinyPod is a silicone case with a built-in scroll wheel that houses the Apple Watch chassis. When an Apple Watch is placed inside the TinyPod, the click wheel on the case is able to be used to scroll through the Apple Watch interface. The feature works...
New MacBook Pros Launching Tomorrow With These 4 New Features 2

M5 MacBook Models to Use New Compact Camera Module in 2025

Wednesday July 17, 2024 2:58 am PDT by
Apple in 2025 will take on a new compact camera module (CCM) supplier for future MacBook models powered by its next-generation M5 chip, according to Apple analyst Ming-Chi Kuo. Writing in his latest investor note on unny-opticals-2025-business-momentum-to-benefit-509819818c2a">Medium, Kuo said Apple will turn to Sunny Optical for the CCM in its M5 MacBooks. The Chinese optical lens company...
iphone 14 lineup

Cellebrite Unable to Unlock iPhones on iOS 17.4 or Later, Leak Reveals

Thursday July 18, 2024 4:18 am PDT by
Israel-based mobile forensics company Cellebrite is unable to unlock iPhones running iOS 17.4 or later, according to leaked documents verified by 404 Media. The documents provide a rare glimpse into the capabilities of the company's mobile forensics tools and highlight the ongoing security improvements in Apple's latest devices. The leaked "Cellebrite iOS Support Matrix" obtained by 404 Media...
Apple Watch Series 9

2024 Apple Watch Lineup: Key Changes We're Expecting

Tuesday July 16, 2024 7:59 am PDT by
Apple is seemingly planning a rework of the Apple Watch lineup for 2024, according to a range of reports from over the past year. Here's everything we know so far. Apple is expected to continue to offer three different Apple Watch models in five casing sizes, but the various display sizes will allegedly grow by up to 12% and the casings will get taller. Based on all of the latest rumors,...

Top Rated Comments

jonblatho Avatar
74 months ago
Alternate headline:

People with Little or No Understanding of Technology Demonstrate Little or No Understanding of Technology
Score: 49 Votes (Like | Disagree)
JeffPerrin Avatar
74 months ago
Basis of this case is so opposite of what actually happened: the race to the bottom in terms of app pricing.

And for those wondering, some of what Apple's 30% pays for for devs:

- Credit card transactions (incl. associated fees)
- Managing sales tax - local and international (!!!)
- Distribution (server and bandwidth costs)
- Sales and installation analytics
Score: 39 Votes (Like | Disagree)
jclardy Avatar
74 months ago
That 30% commission is pretty hefty but allowing apps to be sold outside the appstore and installed on iPhones without being jailbroken would pretty much ruin the edge Apple has on security and privacy it would seem.
I disagree. Just make it like macOS where you have to explicitly allow unsigned code to run on your computer. And leave it off by default.
Score: 34 Votes (Like | Disagree)
barkomatic Avatar
74 months ago
That 30% commission is pretty hefty but allowing apps to be sold outside the appstore and installed on iPhones without being jailbroken would pretty much ruin the edge Apple has on security and privacy it would seem.
Score: 29 Votes (Like | Disagree)
AppliedVisual Avatar
74 months ago
As an app developer, all I can say is that the App Store is a win/win situation for developers and Apple. I also don't think the customer is impacted negatively in any way. The App Store offers assurances on some level that the apps are checked and monitored to be free from malware and they have a singular purchase and billing source and way to manage all their apps. Prices are hardly over-inflated, in fact software/app prices are at all-time lows. I would also argue that the law suit was filed a bit over 8 years ago and is now starting to proceed... Timing on this is now awkward and the suit needs to be updated drastically or dropped altogether. Google has the same "monopoly" with their store as well. If anyone wants to go after illicit software practices or App Store shenanigans of sorts, they need to take a look at the in-app purchase models being used by many developers. Some of these are quite predatory and targeted at kids.

FWIW, as most of my app development is corporate in nature, I have to say that not everything must be distributed through the App Store. There are enterprise deployment options. While this doesn't change things for Joe Consumer, it does mean that when a company hires me to create an app for internal use, we can develop, test and deploy internally without ever touching the App Store and I can turn the app over to them at the end of the contract where they can continue to administer and deploy as they see fit.

Ultimately I see this suit going nowhere. SCOTUS has historically sided with multiple companies accused of the same sort of monopoly. Apple created the platform, they created their ecosystem and there are other alternatives out there. Apple has already won a similar suit regarding iTunes music distribution and AT&T and Verizon have both won similar suits in the past with their own services and music offerings (although on a much smaller scale) before smartphones/ iPhone came along.

And if this suit progresses through, then we as a collective society may as well file suit against Microsoft, Google, Sony, Nintendo, and so on... As they all have their "app stores" for various devices or systems. I can't just download any app/game I want and run it on my Nintendo Switch -- nope, got to get it from the eShop. PlayStation Store? Yep. Xbox Live? Yep.
Score: 19 Votes (Like | Disagree)
jayducharme Avatar
74 months ago
I have a suggestion for Pepper: get an Android phone.
Score: 18 Votes (Like | Disagree)