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Apple App Store Antitrust Appeal Argument Held

By George Khoury, Esq. on November 27, 2018 | Last updated on March 21, 2019

If you own any Apple device made in the last decade, you're probably familiar with the App Store. The App Store app allows Apple users to download both first- and third-party software for their Apple devices.

Unfortunately for Apple, a few years ago, a group of iPhone owners filed a class action antitrust action alleging that Apple's 30 percent commission on apps sold through their app store violates antitrust laws as there is no other platform to purchase apps. The case was initially dismissed at the district court level, but the Ninth Circuit reversed, ruling the case could proceed. But before it does, the High Court will weigh in, and just heard oral argument this week.

App Store Antitrust

The main thrust of the iPhone users' argument is that the App Store's 30 percent commission increases the costs for app purchasers as there is no competitive marketplace for app purchases. However, while there are plenty of garbage apps in Apple's App Store that aren't even worth downloading for free, the company serves as an important gatekeeper against malicious and bad developers by confirming that all apps conform to certain standards to protect consumers.

One of Apple's strongest arguments against allowing the case to proceed involves longstanding Supreme Court precedent that, the company contends, prohibits the app purchasers from filing suit, because the developers are the ones with the potential antitrust claim.

But, as several commentators have noted, a majority of the High Court seemed inclined to rule against Apple, despite the Trump administration backing the company, and to allow the case to move forward.

Curiously, there didn't seem to be any mention of the "jailbreak" community which has, since the first iPhone, diligently hacked Apple's software restrictions to allow non-App Store apps to be downloaded and installed.

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