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Is Apple Violating Antitrust Laws with its App Store?

Apple, Inc. is under investigation over its app store policy of taking a 30% cut of transactions from app providers on its site. The most recent investigation is from the United Kingdom (U.K.) antitrust regulators. The main complaint is that Apple uses its market position to set terms that are unfair or may restrict competition and choice causing consumers to be harmed when buying and using apps. At the core of the investigation is control and the share of revenue received by technology firms that oversee the app market. In other words, Apple has been alleged to stifle competition in the app market. Last year the U.S. Department of Justice and state attorneys general launched an antitrust investigation for developers such as Spotify claiming it is hard to price its offering competitively.

A growing number of political entities are concerned about fair treatment of app developers and their consumers. At about the same time the U.S. opened its investigations, the European Union (E.U.) opened an Apple app store investigation similar to the U.K. investigation. The U.K. is coordinating its investigation with the E.U. since the U.K. is no longer part of the E.U.

Apple has responded that the requirements it places on app developers are "applied fairly and equally to all developers." In addition, the company claims its requirements are intended to "protect customers from malware and to prevent personal data collection without their consent." Apple has four principles upon which it bases its ethics: integrity, honesty, respect, and compliance. According to Apple, it is demonstrating integrity in every business transaction. Since Apple has a cult-like following among many consumers, it's important to act with trust and implement its principles worldwide. At the heart of these investigations is whether or not Apple is living up to its claims of treating app developers fairly.


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