- Apple is battling a $1 billion App Store lawsuit in the UK, requesting a dismissal.
- Apple faces global criticism for its 15%-30% developer fees, leading to legal challenges and antitrust concerns.
Apple requested on Tuesday that a London tribunal dismiss a mass lawsuit, worth around $1 billion, filed on behalf of over 1,500 app developers. This complaint, which may be valued up to £785 million ($998 million) and is one of many that the tech giant is facing in the UK, claims that Apple unfairly charged up to 30% in commissions to third-party developers on purchases of applications.
App Store revenue surge sparks legal challenge
The App Store is part of Apple’s services division, which has witnessed a sharp increase in income over the past several years, reaching $20 billion in quarterly sales. Nonetheless, app developers and antitrust authorities worldwide have targeted the corporation for its 15%-30% fees that the company charges some app developers for using an in-app payment mechanism. According to earlier statements from Apple, 85% of developers on the App Store do not pay any commission.
On behalf of 1,566 app developers, Sean Ennis, a professor at the University of East Anglia’s Centre for Competition Policy and a former Organisation for Economic Co-operation and Development (OECD) economist, is bringing a case in the UK at the Competition Appeal Tribunal (CAT).
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Legal battle unveils controversy
Daniel Piccinin, an attorney for Apple, stated that developers are not eligible for a claim in the UK unless they were billed for transactions made via the UK App Store. The company asserts that this would only apply to a tiny percentage of the claimants.
But according to documents filed in court by Ennis’s lawyer, “(Apple) has come to the UK to offer services to UK businesses on a UK market and has abused its position by overcharging them.” Thus, he contended, the lawsuit may proceed, and UK law would apply throughout.
The company is also involved in a different lawsuit regarding purportedly faulty iPhone batteries. The lawsuit claims Apple “throttled” certain phone models’ batteries through software updates and added a power management tool that reduced performance.
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