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

[MacRumors]

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.

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.

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

 

[rkRusty]

What a load of ropy old toss.

 

[jayducharme]

I have a suggestion for Pepper: get an Android phone.

 

[jonblatho]

Alternate headline:

People with Little or No Understanding of Technology Demonstrate Little or No Understanding of Technology

 

[barkomatic]

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.

 

[killr_b]

cue the thread full of people who think less freedom is a good thing

 

[jclardy]

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.

 

[Azeroth1]

Great image with the article though.

 

[Mitochris]

Isn't this similar to Microsoft being done in the late 90s for having Explorer in their OS? One could at least install other browsers. I understand why Apple is doing it, but I also understand the case. Will be interesting how they side.

 

[vkd]

Yeah, let's go! I'm backing the plaintiffs, full on.

 

[corebeliefs]

Sounds legit. Time to evolve the Apple model. Just because it's tech doesn't provide a valid excuse why Apple gets to control everything it does. Wouldn't BMW love to have a closed system for parts and service. "But ... but it's different! The world will end and devices will explode if Apple can't take its huge cut!!

 

[ersan191]

Of all the things to complain about the App Store for I don’t think “it isn’t cheap enough” is a valid one. Ask any developer...

 

[JeffPerrin]

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

 

[Graphikos]

I'm perfectly content in the iOS app ecosystem. I truly believe Apple has privacy and security in mind by keeping it closed, and that's a very good thing.

That said, just like MacOS, there could be a way to explicitly allow running apps at your own risk. Will this tarnish the brand and perception of a secure and private ecosystem? I'm not sure.

I'm not sure I'd look outside the app store even if I could. I don't need complications, especially on my phone.

How about a model where I just pay Apple for curating an App store, developers can distribute for free? I'll pay that 30%... baked in or otherwise for the peace of mind that the apps are safe for my very personal device.

 

[Rogifan]

And the number of people that care about this we could probably count on one hand.

 

[haydn!]

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

Exactly. Most small developers could not fund this infrastructure and account management themselves with the cut Apple takes. Considering a huge number of Apps hover in the low £1-5 range, and a card transaction fee alone is probably the best part of 30-50p or 15-30%

 

[Nozuka]

This is a hard one to judge. I can see very good arguments for both sides.

But i agree that 30% is too much.

 

[TheRealTVGuy]

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.

Only if you also understand that by doing so you don't get to come back and whine that your processor is overtaxed, your phone overheats, runs slow, etc. because of the crap apps you put on it.

I can hear it now: "Oh Apple, you should replace my phone free of charge since it runs slower due to the crappliy coded and compiled freemium porn app I purchased and installed outside of the App Store (which also stole my identity and spied on me)."

 

[CanadianGuy]

As a developer, I hope these guys win. App review is no longer working as a way to keep users safe, so there's not much point to it anymore. Allowing developers to distribute outside of the App Store will revive innovation. Too many apps are rejected just because Apple doesn't like it, (competes with them for example).

I hope that basing their argument on price doesn't kill the thing, since obviously the prices of apps have gone to 0 since the App Store started.

 

[Chrjy]

Because of course apps are just so expensive these days!

 

[Altis]

Apple seems to love monopolies as they have control over everything, leaving the end user with little choice but to play their game.

 

[AppliedVisual]

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.

 

[Mousse]

It's possible to sideload, *IF* you jailbreak your iPhone.

Gawd, some people want their cake and eat it too. I want my walled garden, but I also want my freedom. If people get their app from another source and it breaks their phone, they'll blame Apple for not protecting them from their own stupidity. There are a lot of Android users like that.

 

[TheRealTVGuy]

Great image with the article though.

Yeah, they beat @AngerDanger to the punch, lol

 

[cjboffoli97]

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.

Conversely, I can install MacOS apps directly from developers on my Macs without significant security risks. So it's not like there isn't already a precedent to allowing developers to deliver directly to customers.