(Updated – March 21, 2024 4:42 pm EST)
Apple (NASDAQ:) shares closed down 4% on Thursday after it was confirmed that the Department of Justice (DOJ) has formally sued the iPhone maker in an antitrust case for monopolizing smartphone markets.
The US Department of Justice and 17 states filed an antitrust lawsuit against Apple, saying the company “has imposed restrictive rules on [the] App Store to force higher fees, hinder innovation, and limit competition.”
Attorney General Merrick Garland said in a statement: “Consumers should not have to pay higher prices because companies violate antitrust laws.
He believes that “if Apple is left unchecked, it will only continue to strengthen its monopoly on smartphones.”
Apple has become the latest high-profile tech firm to be sued by US regulators. The list already includes Meta Platforms, Google and Amazon.com.
The antitrust lawsuit accuses Apple of having an illegal smartphone monopoly that it says is maintained by imposing contractual restrictions and denying critical access to developers.
The antitrust lawsuit alleges that Apple blocks the growth of some apps, stifles mobile cloud streaming services, excludes some messaging apps and limits the functionality of third-party smartwatches.
Apple said in a statement: “We believe this lawsuit is inconsistent with the facts and the law, and we will vigorously defend against it.”
Analysts at Evercore ISI said the U.S. antitrust lawsuit is seen “as a major risk rather than a financial risk, and unless we see new legislation enacted, it is unlikely that Apple will be forced to significantly change its App Store or third-party app store fees.” politicians”.