This is the first of a new series of columns covering the tech world for the Cougar Claw newspaper. These are written by members of the school’s computer science program.
The antitrust division of the DOJ opened a new case against Apple in 2024. If journalists such as CNBC’s Kif Leswing are correct, this could mean a breakup of Apple. Such an event would be a radical change in the tech world that could do anything from lowering phone costs to less integration between former Apple products or even a financial crash directly impacting consumers’ wallets.
The basis of this case is that Apple restricts the app store and device compatibility to prevent competition and that Apple takes a 30% commission on all in-app purchases. Though these are valid criticisms, there will likely be no major effects from this case.
This case resembles the 2001 Microsoft antitrust case which made the ruling that Microsoft had an illegal monopoly through their use of tying together web browser operating systems.
Essentially, Microsoft had prevented all of their customers from installing programs from rivals such as Linux, Apple, or Java. The case is based on the Sherman Antitrust Act which prevents monopolies.
The significance of this ruling regarding Apple is that we have had 23 years to see the effects of this case which have all been either relatively minor or have just created better situations for new megacorporations to make their monopolies.
Microsoft still is a dominant company in the technology industry and the fact they allowed other browsers to be downloaded only strengthened Google’s hold and allowed them to create a monopoly over the tech industry. This effectively means that even if Apple loses this case they will likely maintain a strong position in the industry even if certain aspects of their business are overtaken by other companies.
Another relevant case is the 2020 case of Epic Games vs Apple. Epic Games (the creators of Fortnite) sued Apple for what they believed was a monopoly in the form of the app store. This mainly focused on the 30% commission that Apple took on in-app purchases which in Epic’s case was, according to Forbes, over 100 million dollars.
The initial ruling, which was made in 2021, ruled in favor of Apple except on one minor count revolving around California State Law (which is irrelevant to the federal case). This case is significant because it was a recent case that specifically stated that Apple didn’t have a monopoly.
A significant criticism of the Microsoft case that could be applied to this case is the opinion of renowned economist Milton Friedman, winner of the 1976 Nobel Prize in economics, who stated that he believes the laws don’t exactly match up with the tech industry which is rapidly changing compared to the legal process which is notoriously slow.
Though Friedman died in 2006, his opinion still applies to the current case and will likely apply to future decisions too.
We can only hope that with the high economic impact of this case, the DOJ will make a ruling that doesn’t cause major damage to not just the tech world but the global economy.
