The developer behind secure email service ProtonMail today came out swinging against the way Apple allegedly uses its App Store to control access to iOS users and cut out competitors. The company is all but begging regulators to take stronger action.
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'Apple has become a monopoly, crushing potential competitors with exploitative fees and conducting censorship on behalf of dictators,' ProtonMail founder and CEO Andy Yen wrote in a company blog post. 'We know this because we have quietly tolerated this exploitation for years.'
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Apple, Yen claimed, is using its market power 'to hold all of us [developers] hostage.' Referring to the 30 percent cut Apple takes of any sales through its App Store as a 'tax,' he added that traditional analogies to retail space break down when it comes to software:
Apple attempts to justify these fees by arguing that the App Store is no different from a mall, where companies seeking to offer their products must pay rent to the owner of the mall (in this case, Apple). This argument conveniently ignores the fact that there is just a single mall when it comes to iOS and no possibility of a competing mall to rent space from. It is not illegal for Apple to own a mall and rent space, nor is it illegal for Apple to own the only mall. What is illegal, is exploiting the fact that it owns the only mall to charge excessively high pricing which harms competitors.
'This is virtually indistinguishable from a protection racket,' Yen argued. 'It is a fee that developers must pay if they want to stay in business. And it is a fee which ultimately harms consumers because these fees are indirectly passed on to users, either through higher prices or through fewer competing products in the marketplace.'
AdvertisementProtonMail is not the first to argue that Apple's 30 percent cut amounts to a tax that cuts unfairly into other firms' revenue and makes it harder to compete against Apple's first-party apps. This behavior is not only illegal, Yen wrote, but 'leveraging this power to suppress digital freedom is simply unethical, and it is long overdue that somebody called out Apple for this behavior.'
Widespread claims
Amazon, Facebook, and Google tend to be in the hot seat more often when it comes to matters of trustbusting, anticompetitive behavior, and potential abuse of market power. But Apple, too, is facing a bevy of probes—not only in the United States, but especially in Europe.
Spotify filed an antitrust complaint against Apple with European regulators in March 2019. 'Apple has introduced rules to the App Store that purposely limit choice and stifle innovation at the expense of the user experience,' company founder and CEO Daniel Ek said at the time. Ereader service Kobo joined the complaint in June of this year.
The European Commission's preliminary investigation found 'concerns that Apple's restrictions may distort competition for music streaming services on Apple's devices,' and last month the EU formally opened a deeper probe into Apple's App Store and its Apple Pay payment system.
David Heinemeier Hansson, founder of email-management service Hey, publicly complained last month that Apple privileged its own services over third-party apps such as his. 'You listen to some of these app developers, and they sound like hostages,' Hansson told Protocol. 'They sound like they're reading a prepared statement, because otherwise Apple could hurt their business. Which is true!'
Messaging app Telegram also joined the fray last week, when it, too filed a complaint with the EU alleging Apple was abusing its 'monopolistic power' to stifle innovation.
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