Apple (AAPL) – Antitrust – March 23, 2024
The Department of Justice and 16 states filed an antitrust suit against Apple this week. It claims Apple “illegally monopolizes” the smartphone space with practices that harm developers and competition. The suit is quite broad in nature with complaints ranging from consumer price gouging, artificial barriers to app store competition and unlawful Near Field Communication (NCF) tap-to-pay chip control within Apple Pay. Most of the time, these cases feature immense bark with very little bite. This specific lawsuit, however, could be a bit more material. It covers nearly every facet of Apple’s moat and is something I think shareholders should pay attention to. While resolutions could be negative for Apple, they could be very positive for other companies receiving potential app store fee or NFC access relief.
This will likely take years to be resolved and what actually happens is highly uncertain. Regardless, there will be a new regulatory risk over Apple for the foreseeable future, and to me, this looks to have more legs than recent suits with other mega-caps like Amazon.
- Meta, Microsoft, X and Match Group filed a joint lawsuit against Apple pertaining to its app store policies blocking a developer’s ability to steer users to other app stores.
- Apple is in talks with Google about licensing the search giant’s Gemini AI services for its iPhone Operating System (IOS).
