The US Supreme Court will hear Apple’s appeal in a class action lawsuit alleging the company is abusing its position to charge developers high fees.
Apple takes a 30 percent cut of developers’ app sales on the iOS App Store. This is pretty industry-standard across most of the major app/game stores, including the Play Store and Steam.
The major exception is Microsoft, which recently slashed its cut of Microsoft Store sales from 30 percent to just five percent.
What differentiates Apple is that developers have no alternative through which to sell their iOS apps. Even on Android, it is possible to install third-party app stores or sideload apps directly.
The lawsuit says this high cut taken by Apple means developers raise their prices, costing more for consumers in violation of federal antitrust laws.
Apple’s argument is that it’s consumers making the lawsuit who do not have any legal standing as Apple acts as an intermediary for developers.
The original case was thrown out by a Californian federal judge for this very reason – saying consumers were not being charged more by Apple, but developers.
Last year, the case was revived by a San Francisco appeals court who said that Apple sells the apps to consumers directly and so must be subject to the antitrust claims.
Apple said in its appeal that other stores which sell things on behalf of third-party sellers – like eBay, Amazon, and Google – must therefore also be included. However, alternatives to these stores are readily available to both sellers and buyers.
The issue here is Apple offers no alternative to selling or buying apps through anything other than the iOS App Store, and whether it’s using this position to inflate prices.
What are your thoughts on the Apple lawsuit? Let us know in the comments.
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