Another day, another lawsuit. Two iOS developers hit Apple with a class-action lawsuit claiming the tech giant has cornered the iOS app market with its App Store and knowingly used its monopoly to implement “profit-killing” commissions and fees on the very developers who bring Apple’s products to life, according to attorneys at Hagens Berman.
The lawsuit filed in the U.S. District Court for the Northern District of California in San Jose regards Apple’s allegedly anticompetitive practices in mandating only one app store for iOS devices, which sets the stage for Apple to abuse its market power. For 11 years, Apple has instated a 30% commission rate on all app paid sales conducted through the App Store and on any in-app purchases made in iOS apps. The lawsuit also alleges that Apple unfairly:
Charges high commissions on subscriptions purchased in-app;
Sets, in addition to the 30% cut taken from all app sales and in-app purchases, an artificial minimum pricing mandate of $.99 for paid apps or in-app products
Dictates that all App Store paid purchases end in $.99;
Forces developers selling products through the App Store to pay an annual Apple Developer fee of $99 to distribute their apps, “which is especially damaging to smaller and new developers.”
It also alleges that putting all iOS apps into one marketplace also means consumers never see most apps, stifling competition and innovation. The plaintiffs want a jury trial and for Apple to pony up reimbursements to developers.