Apple is bringing major changes to the App Store with the release of iOS 17.4. However, the changes will be implemented in the EU under the Digital Markets Act, allowing users to sideload apps and install alternative app stores on the iPhone. Apple could face the same fate in the United States, and a federal judge has reinitiated a class action lawsuit against Apple's App Store practices. The case was originally filed in 2011, but the judge had reservations regarding the certification and denied class-action certification in March 2022.
Federal judge approves class action lawsuit against Apple, highlighting Apple's App Store policies
Initially, the lawsuit was filed against the App Store's restrictive policies and anti-competitive nature, which did not allow third-party payment options or the ability to sideload apps on the iPhone. Since Apple is the only one with an App Store on the iPhone, it charges prices to developers with a hefty commission. The case also states that the 30 percent commission that Apple gets on all App Store transactions is an important factor in price inflation.
While the judge denied the class-action certification in March 2022, a revamped proposal included users who spent at least $10 on in-app purchases, which made the judge reconsider the class for further proceedings. The revised niche of users in the case includes tens of millions of users and the impact it could have on the app economy, raising antitrust concerns (via Reuters).
While the plaintiff succeeded in the lawsuit against Apple, Judge Rogers acknowledged that there is a possibility that millions of users within the class might not have been harmed. The judge also took testimony from Nobel Laureate Daniel McFadden, who quantified the harm caused by Apple due to its practice and policies in the App Store. If the lawsuit advances against Apple, the company would have to pay hefty fines. However, this is not the only concern for Apple. The company knows how the laws can implement anticompetitive policies for the digital app market.
Apple has until March 6 to comply with the App Store changes under the Digital Markets Act. The lawsuit arising in the United States could develop into something similar, demanding Apple to open the App Store and reconsider its policies. Apple would have to allow third-party apps on the iPhone and alternate app stores with their dedicated payment methods. However, these are only speculations and applicable if the lawsuit expands to discuss the company's pricing models, app competition, and consumer rights in the United States.
Like the EU, Japan is also working on its Digital Antitrust Law to tackle antitrust practices by companies such as Apple and Google. This will prevent companies from gaining dominance in the digital marketplaces. This will also allow the companies to offer alternate app stores and allow users to sideload apps outside the official App Store.
About the author: Ali Salman is a technology reporter for Wccftech mobile section with a specialized focus on Apple and the intellectual property that drives mobile innovation. He has cultivated a unique expertise in analyzing and deconstructing complex technology patents, translating dense legal and technical documents into clear, insightful reports on future products.
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