Apple Inc mandates a 30 per cent in-app fee for the distribution of digital content with other restrictions that hurts software developers limiting them to use Apple’s App Store payment system.
The tech giant Apple Inc is facing an antitrust lawsuit in India for allegedly abusing its dominant position over the app market.
The allegations came a day after Japan made Apple land on a settlement which will let publishers of “reader apps” (i.e. apps used for consuming media in the forms of books, music or files in the cloud) redirect users via external sites to choose alternatives to Apple’s proprietary ‘App store’ for in-app payment provisions.
A little-known Rajasthan-based non-profit organization filed the suit, “Together We Fight Society,” which represents consumers and startups in its complaint to the Competition Commission of India, the nation’s monopoly regulator.
The filings and details of cases reviewed by the CCI are not made public like Indian court cases.
The antitrust filing in India has yet to be filed formally. Still, the anti-competitive practices by app store operators- specifically Apple and others like WeChat and Google in payments systems results in consumer harm and makes it unviable for software startups to existing at all, reported Reuters.
According to Reuters, “The existence of the 30% commission means that some app developers will never make it to the market”.
In India, about 2% of 52 million smartphones are Apple’s iOS-powered, with the rest being Android as per a report for 2020.
The Apple case in India comes as other countries like Japan, South Korea, the U.S, Australia, and the European Union have either reached a settlement or have passed laws concerning the issue.
This week South Korea’s parliament approved a bill that bans tech giants’ app store operators like Alphabet’s Google and Apple from forcing software developers to use their payment systems.
Apple’s antitrust concession loosens payment rules for Netflix and Spotify.
The iPhone maker’s latest concession update will take effect worldwide in early 2022, was announced Wednesday and will allow software developers of what Apple (AAPL) calls “reader” apps to redirect the users by inserting a link out to external websites and will ultimately let people set up or manage their accounts there.
The decision came in response to an investigation commenced by Japan’s Fair Trade Commission.
Cloud-based media applications like Spotify and Netflix once allowed users to pay for services in-app. Still, since the latest developments, that form of billing for new members have stopped amid a dispute with Apple over the hefty commission it charges.
For example, downloading the Netflix app will allow you to sign in only if you have a pre-existing account. If the user is not already a subscriber, the app asks you to “join and come back” once you create an account.
Horacio Gutierrez, the chair of global affairs and chief legal officer at Spotify, tweeted, “Apple’s selective tweaks to its App Store rules are welcome, but they don’t go far enough”.
Reuters also noted from the filing that, “This could also result in consumer harm.” The CCI and Apple did not respond to a request for comment.
A source familiar with Apple’s anti-competitive matter said, “There are high chances that an investigation can be ordered, also because the EU has been probing this”.