Apple has a monopoly on the distribution of apps through the App Store on iOS devices, the House Judiciary Subcommittee said in a report Tuesday, according tomedia appleInsider. The House judiciary report ends a year-long investigation into four dominant technology companies: Apple, Amazon.com Inc. and Facebook Inc. The nearly 450-page report argues that all four companies have anti-competitive and monopoly tools.
Apple’s control of iOS “gives it the power to distribute software on iOS devices,” the report said. Because the App Store is the only app distribution method on iOS, Apple doesn’t allow non-native app stores to be installed on its mobile devices. The report quoted iOS developers as adding that Apple was “actively undermining the progress of the open web on iOS” in order to push the company to build native apps on iOS, not web apps.
“So Apple’s position as the only app store on iOS devices is unshakable. Apple has full control over how software is installed on iOS devices, and chief executive Tim Cook has explained that the company has no plans to allow an alternative app store. The former director of the App Store’s app review team observed that Apple was ‘not subject to any meaningful competition constraints from alternative distribution channels,'” the panel found.
The subcommittee reviewed Apple’s 30 percent cut in in-app purchases, how it handles pre-installed apps and third-party apps, and whether Apple used its control of the iOS App Store to “collect business intelligence to better compete with third-party apps.”
“Apple’s monopoly on software distribution on iOS devices seems to have enabled it to make extraordinary profits from the App Store and its services business.” The report says.
In an interview in June, Senator David Sisilin, head of the antitrust subcommittee, called Apple’s 30 percent cut in app purchases a “highway robbery.”
The team also found evidence of exclusivity when removing or suppressing parental control apps comparable to Apple’s own Screen Time feature. Additional reviews of the App Store’s rules, regulations, and application review procedures have also been conducted.
In an interview with the subcommittee, Phillip Shoemaker, a former senior director of review at the App Store, suggested that the rules were being applied arbitrarily or in a way that would benefit Apple.
Shoemaker has previously pointed to a record of problems with apps competing with Apple’s services during the app Store review process. For example, Apple’s gaming service, Apple Arcade, is an app type that ‘has not been allowed into the Store’, “when provided by a third-party developer, but Apple allows its own app to enter the store,” even if it violates existing App Store guidelines. Mr. Shoemaker explained to the subcommittee staff that Apple’s new guidelines for streaming gaming services, 3.1.2a, were probably written to “specifically exclude Google Stadium,” a decision he described as ‘completely arbitrary,'” the document reads.
Apple insisted that the App Store guidelines were “open and transparent,” a phrase cited by tim Cook, the company’s CEO, at a hearing in July.
The team also looked at Apple mergers, App Store search priorities, first-party services such as Apple Pay and Siri, and “Sherlocking.”
While the report does not explicitly call for Apple or other tech giants to be split, it endorses a series of legislative changes that would allow the government to better regulate leading companies. This includes structural separation and a ban on leading platforms entering similar lines of business, and instructs antitrust regulators to consider the merger of dominant platforms to be anti-competitive. The report also recommends preventing the dominant platform from focusing on their own services and requiring them to make their services compatible with third parties.
As for other companies, the group found that Amazon had a monopoly on third-party sellers and suppliers, Facebook on online advertising and social networks, and Google on web search.
“Simply put, the weak start-ups that used to struggle and challenge the status quo have become the kind of monopolies we saw last time in the days of oil and rail tycoons.” The report says. “While these companies bring tangible benefits to society, the dominance of Amazon, Apple, Facebook and Google comes at a price.”
The findings come in the face of an antitrust review of Apple and other technology companies. The U.S. Department of Justice launched an investigation into Apple in June and plans to file a lawsuit against Google.