If you are a developer that wants to launch an app through Apple’s App Store, you’ll need to pony up some cash to match Apple’s associated fees to do so. This has been the case for years, but a group of developers is ready to take the company to task for this “anti-competitive” behavior.
Some developers are moving ahead with a class action lawsuit against Apple, moving ahead with an argument that Apple has “knowingly used its monopoly” to charge “profit-killing” fees to developers. The new suit has already been filed in the United States District Court for the Northern District of California. The suit further claims that Apple is violating not only the California Unfair Competition Law, but also the Sherman Act. The developers are hoping that, by the end of it, Apple will have to reimburse developers for the unfair fees they’ve paid.
They are seeking trial by jury, and have brought on experienced attorneys to make this all happen. Hagens Berman is a name that might seem familiar. These are the folks who actually went to court over book price-fixing some years ago, going up against Apple and other companies. They won that effort, too.
So, it shouldn’t be surprising that Hagens Berman is ready to go up against Apple again, and feels pretty confident in how it will turn out this time around:
This isn’t the first time we’ve taken Apple to task over anticompetitive behavior,” said Steve Berman, managing partner of Hagens Berman. “We have successfully held Apple to the law in the past, and we intend to fight hard for the rights of iOS developers who bring their hard work and creativity to the iOS App Store with the hope of fairly monetizing their creations.”
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,” he continued. “In a competitive landscape, this simply would not happen.
As noted today by AppleInsider, the primary argument from the developers that are taking part in this suit is one of monopolistic behavior. Specifically, the developers say Apple’s security argument (that it enacts these fees and App Store rules to provide the best possible, and secure, experience for users) is basically hogwash, calling it “overblown pretense”. The developers believe Apple keeps harping these bullet points so that it can keep developers paying the fees.
Apple has not commented on this particular lawsuit, and probably won’t in any public capacity unless it absolutely has to. However, this is not the only fight that the company is in regarding monopolistic methodology. The company recently made a public remark in light of a Supreme Court ruling in the United States over an antitrust case, saying that the App Store is not a monopoly and that its rules are in place to offer up the best possible experience.
Here, in part, is Apple’s statement on that matter. The company is quick to point out the user experience and safety, which is specifically mentioned in this new class action suit:
We’re proud to have created the safest, most secure and trusted platform for customers and a great business opportunity for all developers around the world. Developers set the price they want to charge for their app and Apple has no role in that. That vast majority of apps on App Store are free and Apple gets nothing from them. The only instance where Apple shares in revenue is if the developer chooses to sell digital services through the store.
Basically, Apple is facing a lot of suits from different sources, but all rooted in the same argument: that Apple’s monopoly with the App Store has reached a boiling point. Whether or not that’s actually the case remains to be seen, at least from a legal standpoint.
What say you? Is the App Store a monopoly? Is it time for Apple to change its ways?