Developers sue Apple Over App Store ‘Monopoly’

Developers sue Apple Over App Store ‘Monopoly’

Apple has been hit with a lawsuit from two app developers, who allege that the App store gives the iPad maker a monopoly on the sale and distribution of iOS apps.

The lawsuit filed in the US District Court for the Northern District of California in San Jose, also alleges that Apple places unfair “profit-killing” charges on developers. Developers have to pay a $99 annual fee, plus give Apple 30 percent of most transactions.

This last point is a sensitive subject for Apple, with EU regulators reportedly set to launch a formal antitrust probe against Apple, following a complaint by Spotify earlier this year.

Apple apps

App lawsuit

In March the Swedish company filed a complaint in which it accused Apple of unfairly using the dominance of its mobile App Store to give the Apple Music service a competitive advantage.

The complaint centres on Apple’s policy of charging digital content providers a 30 percent fee for using its payment system for subscriptions sold in the App Store.

Apple has strongly defended itself against Spotify’s complaints.

But now two app developers (a developer of a baby naming app and a basketball workout app) are also jumping onboard.

Their attorneys at Hagens Berman allege that Apple’s anticompetitive behaviour is “profit-killing” for iOS developers, by design.

They claim Apple has “cornered the iOS app market with its App Store and knowingly used its monopoly to implement ‘profit-killing’ commissions and fees on the very developers who bring Apple’s products to life.”

The lawsuit is seeking class action status so that other US developers who have sold an iOS app via the App store can join it.

The lawsuit also objects to Apple’s rules that sets “an artificial minimum pricing mandate of $.99 for paid apps or in-app products. It also dictates that all App Store paid purchases end in $.99.”

“Between Apple’s 30 percent cut of all App Store sales, the annual fee of $99 and pricing mandates, Apple blatantly abuses its market power to the detriment of developers, who are forced to use the only platform available to them to sell their iOS app,” said Steve Berman, managing partner of Hagens Berman and attorney representing the proposed class of developers. “In a competitive landscape, this simply would not happen.”

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