Pressure Intensifies On Apple After Microsoft President’s Criticism Of App Stores

Microsoft has supported the calls for conducting an antitrust investigation into the alleged monopolistic practices at App Store which has put more pressure on Apple.

Earlier this month, the policy of Apple to take a 30 per cent cut from antitrust investigation that the iPhone maker takes to allow the developers to sell their products through the App Store was criticized by Brad Smith, Microsoft’s president. Smith contended that this policy of the Apple was a far greater burden as a road block to fair competition than the issues for which Microsoft was slapped with an antitrust case during the early 2000s.

While comments by Smith did not mention Apple by name, it certainly added on to the growing criticism of Apple that the company’ policies for monetising its position as the sole decider on the issue of what can be installed on iPhones and iPads all around the world were grossly against fair laying ground norms and practices.

The limitations Apple places on its app stores were the focus of the complaints. One of the preconditions imposed on developers for listing their products on or for publishing an app for iPhone users is the mandatory payment for such purchases through the in-app payment systems of apple which allows it to take a part of the sale value – which typically is set at 30 per cent of the revenues generated from such sale.

The iPhone maker however makes exceptions for “reader” apps, such as Netflix and Kindle, and allows such companies to offer their customers access to their digital content bought on other platforms. However there are strict limits in such cases also as Apple prevent such developers from actively telling users where to go to pay and not allowing customers to even know of the existence of other modes of payment.

Apple on its part has argued for long that these rules are helpful in preventing customers from falling prey to fraud and scams.

However, late last week, the European Commission announced its decision to initiate an investigation into whether these rules set by Apple were anticompetitive in nature. “It appears that Apple obtained a ‘gatekeeper’ role when it comes to the distribution of apps and content to users of Apple’s popular devices,” said Margrethe Vestager, the competition commissioner. “We need to ensure that Apple’s rules do not distort competition.”

The investigations against Apple’s App Store was prompted by a complaint filed with the Commission from Spotify as well as by an unnamed “e-book/audiobook distributor” which is believed to be the Japanese conglomerate Rakuten.

These claims of anti-competitiveness have been called as “baseless” by Apple.

(Adapted from TheGuardian.com)

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