UK launches competition probe into Apple's App Store monopoly

WION Web Team
London, United Kingdom Published: Mar 04, 2021, 09.33 PM(IST)

Apple CEO Tim Cook is seen in this image along with a MacBook Photograph:( AFP )

Story highlights

Payment policies related to Apple's App Store have for long drawn complaints from app developers as it requires them to use its payment system, which charges commissions of between 15 per cent and 30 per cent

Britain's competition regulator said on Thursday it has opened an investigation into Apple Inc after complaints that the iPhone maker's terms and conditions for app developers are unfair and anti-competition.

The Competition and Markets Authority (CMA) announced that it will examine Apple's position regarding the distribution of apps on its iPhones, iPads and other devices in Britain.

Payment policies related to Apple's App Store have for long drawn complaints from app developers as it requires them to use its payment system, which charges commissions of between 15 per cent and 30 per cent.

Apple said in response that it looked forward to working with the CMA to explain how its "guidelines for privacy, security and content have made the App Store a trusted marketplace for both consumers and developers".

The news however comes as Apple also faces a European Commission antitrust probe into its App Store, while the tech titan remains locked in a fierce US legal battle over the matter with Fortnite maker Epic Games.

The App Store is the only way for developers to distribute their apps for use on the US company's devices to the public.

"The CMA's investigation will consider whether Apple has a dominant position in connection with the distribution of apps on Apple devices in the UK," the UK regulator said in a statement.

Last year, the European Commission too had opened a probe into the iPhone maker over App Store commission fee.

Impact on choice and price

The CMA will also examine "whether Apple imposes unfair or anti-competitive terms on developers using the App Store, ultimately resulting in users having less choice or paying higher prices for apps and add-ons".

Apple must first approve all apps before they are placed on the App Store and developers must agree to certain terms.

"The probe has been prompted by the CMA's own work in the digital sector, as well as several developers reporting that Apple's terms and conditions are unfair and could break competition law," the regulator added.

The CMA said complaints highlighted also that Apple required "in-app" features, add-ons and upgrades to use the US group's payment system, rather than any alternative.

Apple charges developers a commission of up to 30 percent on initial app downloads and updates, the CMA said.

"Millions of us use apps every day to check the weather, play a game or order a takeaway," said CMA chief executive Andrea Coscelli.

"So complaints that Apple is using its market position to set terms which are unfair or may restrict competition and choice -- potentially causing customers to lose out when buying and using apps -- warrant careful scrutiny."

Fornite maker's Apple feud

News of the British probe comes two weeks after Epic Games -- best known for massively popular online role-playing hit Fortnite -- lodged a complaint against Apple with EU antitrust authorities, deepening its bitter feud with the iPhone-maker over its app store.

Apple and Epic have also been locked in a fierce battle over whether Apple's tight control of the App Store, and its 30-per cent cut of revenue, is abusive.

That dispute took a dramatic turn last August when Apple expelled Fortnite, one of the world's most popular games, from its App Store after Epic released an update that dodged revenue-sharing with the iPhone maker.

The global war over the App Store has also widened to Facebook, whose CEO Mark Zuckerberg accuses Apple of imposing rules for outside developers that it does not apply to its own services.

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