Tech

Apple faces antitrust probe in the UK over its App Store rules

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Key Points
  • The U.K.'s Competition and Markets Authority is investigating Apple over complaints from software developers about its App Store.
  • Apple has a rigorous approval process for iOS apps and has faced criticism about fees of up to 30% which it charges on in-app transactions.
  • Large U.S. tech companies are facing mounting antitrust scrutiny from regulators around the world.
Tim Cook, chief executive officer of Apple, speaks at the 2019 Dreamforce conference in San Francisco on November 19, 2019.
David Paul Morris | Bloomberg | Getty Images

LONDON — The U.K.'s competition regulator on Thursday launched an antitrust investigation into Apple.

The Competition and Markets Authority said it would investigate Apple over complaints from software developers about the tech giant's App Store.

Apple only lets developers release iPhone and iPad apps through its iOS smartphone platform. The firm has a rigorous approval process for iOS apps and has faced criticism about fees of up to 30% which it charges on in-app transactions.

"Millions of us use apps every day to check the weather, play a game or order a takeaway," said Andrea Coscelli, chief executive of the CMA.

"Complaints that Apple is using its market position to set terms which are unfair or may restrict competition and choice — potentially causing customers to lose out when buying and using apps — warrant careful scrutiny."

Shares of Apple were down 0.5% in premarket trading Thursday. Tech shares were clobbered Wednesday amid concerns on Wall Street over rising U.S. bond yields.

Britain's competition probe into Apple follows similar moves from the European Union. Last year, the EU Commission launched antitrust investigations into Apple's App Store rules and its Apple Pay mobile wallet. The CMA said it would continue to coordinate closely with the EU and other regulators, despite Britain having formally left the bloc last year.

An Apple spokesperson said the firm would work with the CMA to address its concerns.

"We believe in thriving and competitive markets where any great idea can flourish," the spokesperson said.

"The App Store has been an engine of success for app developers, in part because of the rigorous standards we have in place — applied fairly and equally to all developers — to protect customers from malware and to prevent rampant data collection without their consent."

Big Tech clampdown

Large U.S. tech companies are facing mounting antitrust scrutiny from regulators around the world. The EU is looking to clamp down on Big Tech with sweeping digital markets and services reforms. The U.K., meanwhile, has plans of its own to introduce new digital rules.

Epic Games, creator of the popular video game Fortnite, has been particularly vocal in its criticism of Apple. Epic claims the iPhone maker's App Store rules are anti-competitive and has particularly taken issue with the 30% cut that Apple takes from developers for in-app purchases.

Last month, Epic filed an antitrust complaint against Apple with the EU. It's filed similar lawsuits with competition regulators in the U.S., Australia and the U.K.

Epic's fight with Apple began after it released an updated version of Fortnite that allowed players to bypass Apple's payment system to buy digital goods. Apple subsequently delisted the game, which was met with legal action from Epic hours later. Google was also sued by Epic after it removed the Android version of Fortnite.

Spotify and Match Group have also complained about Apple's policies.

"The U.K. Competition and Markets Authority joins an ever-growing list of regulators to open an investigation into Apple's App Store practices," a Spotify spokesperson said.

"We welcome this and hope to see swift action because Apple's anticompetitive behavior is harmful to not just Spotify but to app developers and consumers everywhere around the world."