Apple finds itself starting a new legal battle today, this time in the UK. A class action lawsuit alleges that the iPhone maker has abused its position to overcharge App Store customers.
A second prong of the lawsuit alleges that the 30 percent commission fee Apple charges app developers runs counter to both UK and European competition laws. The UK’s Competition Appeal Tribunal will be looking into the claims and passing judgement.
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The case is being brought to court by King’s College London academic Dr Rachael Kent. She says that as owners of iPhones and iPads have no option but to use the App Store, there is no competition which could help to drive down prices. As such, Apple is accused of overcharging customers.
Dr Kent likens the commission Apple charges to rent, saying:
The App Store was a brilliant gateway for a range of interesting and innovative services that millions of us find useful, myself included. But 13 years after its launch, it has become the only gateway for millions of consumers. Apple guards access to the world of apps jealously, and charges entry and usage fees that are completely unjustified.
This is the behavior of a monopolist and is unacceptable. Ordinary people’s use of apps is growing all the time, and the last year in particular has increased our dependence on this technology. Apple has no right to charge us a 30 percent rent for so much of what we pay for on our phones — particularly when Apple itself is blocking our access to platforms and developers that are able to offer us much better deals.
The trial is expected to last for a number of weeks, and while it is hard to predict just how the case will pan out, Apple is defiant:
We believe this lawsuit is meritless and welcome the opportunity to discuss with the court our unwavering commitment to consumers and the many benefits the App Store and Apple’s valuable technologies have delivered to the UK’s innovation economy.
The company adds: “The commission charged by the App Store are very much in the mainstream of those charged by all other digital marketplaces. In fact, 85 percent of apps on the App Store are free and developers pay Apple nothing. And for the vast majority of developers who do pay Apple a commission because they are selling a digital good or service, they are eligible for a commission rate of 15 percent”.
Image credit: Nicolas_Raido / depositphotos
