Apple denies price fixing allegation in US Supreme Court

Apple has been accused of using its "absolute power" over the App Store to make unfair demands of developers regarding the prices it charged customers and how much it received per app sale

27Nov

Apple has appeared before the US Supreme Court to argue against anti-trust allegations that it had used its power over the US' most popular app store, the App Store, to make unfair demands of developers.

The demands Apple was allegedly placing on developers included demanding a 30% cut of every app sale, insisting that apps were "App Store only" and that prices ended with ".99". As the most popular app store in the US, the class action suit against the tech giant asserts that Apple had essentially created a monopoly through these actions and this had led to overall higher prices as a result.


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However, Apple argued that the App Store is no more than an avenue for developers to reach customers from whom they paid directly when purchasing apps. It also said that the 30% commission was the cost for a "shelf" in the App Store, thus unconnected from the sales.

These allegations against Apple were first levied in 2012 in an effort to open up app purchases to other stores and hopefully bring down prices. That case was won by Apple who used the above argument that customers were buying apps directly from developers. However, the resubmitted suit asserts that as app developers do not own their own stores, Apple is accountable.

With Apple now before the highest court in the US, this is its last chance to make its case before a somewhat skeptical bench. Justice Stephen Breyer, a former anti-trust professor at Harvard Law said "the consumers' case seemed straightforward and in line with a century of antitrust law", according to a report from the Associated Press. Only one of the Justices, Justice John Roberts, seemed to be on Apple's side in the hearing.

Justice Elena Kagan argued: "I pick up my iPhone. I go to Apple's App Store. I pay Apple directly with credit card information that I've supplied to Apple. From my perspective, I've just engaged in a one-step transaction with Apple.:

The case remains in its early stages and it will be months before a decision has been reached. 

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