Apple is being accused by the Justice Department of engineering an illegal monopoly in the smartphone market that keeps prices artificially high, locks out competitors, and stifles innovation. The department filed the broad antitrust complaint against Apple on Thursday.
Apple is accused of having monopoly power in the smartphone industry and using its hold on the iPhone to “engage in a broad, sustained, and illegal course of conduct,” according to the lawsuit, which was submitted to a federal court in New Jersey.
“Apple has locked its consumers into the iPhone while locking its competitors out of the market,” said Deputy Attorney General Lisa Monaco. Stalling the advancement of the very market it revolutionized, she said, it has “smothered an entire industry.”
Apple called the lawsuit “wrong on the facts and the law” and said it “will vigorously defend against it.”
The sweeping action takes aim at how Apple molds its technology and business relationships to “extract more money from consumers, developers, content creators, artists, publishers, small businesses, and merchants, among others.”
This include reducing the functionality of smartwatches that aren’t made by Apple, restricting third-party digital wallets’ ability to use contactless payment, and prohibiting the exchange of encrypted messages between its iMessage programmes and other platforms.
In particular, it aims to stop Apple from sabotaging apps that rival its own, such as those for messaging, streaming, and digital payments, and from continuing to negotiate deals with accessory manufacturers, developers, and customers that allow it to “obtain, maintain, extend, or entrench a monopoly.”
With the declared goal of making the digital world more equitable, inventive, and competitive, the Justice Department has also sued Amazon, Google, and other internet titans. This action, which has been brought alongside 16 state attorneys general, is just the most recent example of the department’s strong antitrust law enforcement.
“The Department of Justice has an enduring legacy taking on the biggest and toughest monopolies in history,” said Assistant Attorney General Jonathan Kanter, head of the antitrust division, at a press conference announcing the lawsuit. “Today we stand here once again to promote competition and innovation for next generation of technology.”
