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Apple Has Kept An Illegal Monopoly Over Smartphones In US, Justice Department Says In Antitrust Suit

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Washington —A.P.he Justice Department announced a broad antitrust case against Apple on Thursday, accusing the company of creating an illegal smartphone monopoly that excludes competitors and stifles innovation.

The case, filed in federal court in New Jersey, claims that Apple has monopoly power in the smartphone market and utilizes its control over the iPhone to “engage in a broad, sustained, and illegal course of conduct.”

The lawsuit, which was also filed with 16 state attorneys general, is the latest example of the Justice Department’s aggressive enforcement of federal antitrust law. Officials say it is intended to ensure a fair and competitive market, despite the fact that it has lost some significant anticompetition cases.

Apple deemed the case “wrong on the facts and the law” and stated it “will vigorously defend against it.”

apple

Apple Has Kept An Illegal Monopoly Over Smartphones In US, Justice Department Says In Antitrust Suit

President Joe Biden has urged the Justice Department and the Federal Trade Commission to rigorously enforce antitrust laws. Some business executives have objected to the Democratic administration’s increasing surveillance of corporate mergers and business deals, calling it overreaching, but others have praised it as long necessary.

The case is directly aimed at the digital fortress that Apple Inc., based in Cupertino, California, has painstakingly built around the iPhone and other popular products such as the iPad, Mac, and Apple Watch to create what is often referred to as a “walled garden” in which its meticulously designed hardware and software can coexist while requiring consumers to do little more than turn the devices on.

The strategy has helped Apple become the world’s most affluent corporation, with annual revenue of about $400 billion and, until recently, a market value of more than $3 trillion. However, Apple’s stock has declined 7% this year, while the rest of the stock market has risen to new highs, allowing long-time rival Microsoft — the target of a major Justice Department antitrust action a quarter-century ago — to take the lead as the world’s most valuable corporation.

According to Apple, a victory in the lawsuit would “hinder our ability to create the kind of technology people expect from Apple — where hardware, software, and services intersect” and that it would “set a dangerous precedent, empowering government to take a heavy hand in designing people’s technology.”

“At Apple, we innovate every day to make technology people love — designing products that work seamlessly together, protect people’s privacy and security, and create a magical experience for our users,” the company said in a press release. “This action undermines who we are and the ideals distinguishing Apple goods in intensely competitive marketplaces.

Apple has defended the walled garden as an essential feature valued by users seeking the best protection possible for their personal information. It has framed the barrier as a means for the iPhone to separate itself from handsets using Google’s Android software, which is less restrictive and available to a wider range of manufacturers.

Fears of an antitrust crackdown on Apple’s business model and concerns that it is falling behind Microsoft and Google in the race to build artificial intelligence-powered devices have all contributed to the company’s stock price decline.

However, antitrust investigators made it clear in their complaint that they saw Apple’s walled garden primarily as a tool to ward off competition. It established market circumstances that allowed it to charge higher prices, which have pushed its soaring profit margins while limiting innovation.

apple

Apple Has Kept An Illegal Monopoly Over Smartphones In US, Justice Department Says In Antitrust Suit

Attorney General Merrick Garland said in a statement, “Consumers should not be forced to pay higher prices because businesses violate antitrust laws. “We contend that Apple has maintained monopoly strength in the smartphone industry not just by outperforming competitors on merit but also by breaching federal antitrust laws. If left undisturbed, Apple would simply strengthen its smartphone monopoly.”

The Biden administration is escalating an antitrust siege in an attempt to limit Apple’s dominance, which has already resulted in lawsuits against Google and Amazon accusing them of using illegal tactics to stifle competition, as well as unsuccessful attempts to block acquisitions by Microsoft and Facebook parent Meta Platforms.

Apple’s economic interests are also entangled in the Justice Department’s case against Google, which went to trial last October and is set to begin closing arguments on May 1 in Washington, D.C. In D.Cthat case, regulators claim Google has stifled competition by paying for the rights to its already dominant online search engine to be the default place to handle queries on the iPhone and a variety of web browsers, in an arrangement worth an estimated $15 billion to $20 billion per year.

Now that the Justice Department is directly attacking Apple’s business, the company will lose considerably more.

The Justice Department is following up on other recent attempts to compel Apple to change how it operates the iPhone and other elements of its company.

Epic Games, the creator of the blockbuster video game Fortnite, filed an antitrust action against Apple in 2020 to break down the barriers safeguarding the iPhone App Store and a profitable payment system that operates within it. Apple has traditionally charged commissions ranging from 15% to 30% on digital transactions performed within applications, which Epic claimed was possible by an illegal monopoly that drives up consumer prices.

apple

Apple Has Kept An Illegal Monopoly Over Smartphones In US, Justice Department Says In Antitrust Suit

Following a month-long trial in 2021, a federal court decided primarily in Apple’s favour, except for allowing links to other payment alternatives within iPhone apps. Apple unsuccessfully contested that section of the verdict until the United States Supreme Court declined to hear an appeal in January, forcing the corporation to concede. However, Apple’s concessions to comply with the verdict are still being challenged as “bad faith” by Epic, seeking an April 30 hearing to ask U.S. District Judge Yvonne Gonzalez Rogers to require additional revisions.

Apple also had to open up the iPhone to allow apps to be downloaded and installed from competing stores in Europe earlier this month to comply with a new set of regulators known as the Digital Markets Act, or DMA, but critics see its approach as little more than a workaround that will allow it to continue to stifle true competition. European Union regulators have already promised to tighten down on Apple if the company’s actions continue to stifle meaningful consumer choice.

This comes on top of a $2 billion (1.8 billion euro) fine that European regulators levied earlier this month after determining that Apple had harmed competition in music streaming via the iPhone, despite Spotify being the market leader.

SOURCE – (AP)

Kiara Grace is a staff writer at VORNews, a reputable online publication. Her writing focuses on technology trends, particularly in the realm of consumer electronics and software. With a keen eye for detail and a knack for breaking down complex topics, Kiara delivers insightful analyses that resonate with tech enthusiasts and casual readers alike. Her articles strike a balance between in-depth coverage and accessibility, making them a go-to resource for anyone seeking to stay informed about the latest innovations shaping our digital world.

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Car Dealerships Are Being Disrupted By A Multi-Day Outage After Cyberattacks On Software Supplier

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Car Dealership | AP News Image

NEW YORK — This week, car dealerships around North America experienced huge interruptions.

CDK Global, which offers software to thousands of auto dealers in the United States and Canada, was struck by back-to-back intrusions on Wednesday. This resulted in an outage that disrupted many of their operations on Friday.

Prospective auto purchasers may face showroom delays or handwritten vehicle orders with no obvious end. Here’s what you should know.

CDK Global is a key player in the automotive sales business. The company, situated in Hoffman Estates, Illinois, just outside of Chicago, supplies dealers with software technology to help with day-to-day operations such as vehicle sales, financing, insurance, and repairs.

dealership

Dealership | CNN Image

Car Dealerships Are Being Disrupted By A Multi-Day Outage After Cyberattacks On Software Supplier

According to the business, CDK supports over 15,000 retail locations in North America. It was unclear whether this week’s cyberattacks affected all of these places.

According to spokesperson Lisa Finney, CDK is “actively investigating a cyber incident” and has shut down all of its systems out of prudence.

According to Finney’s statement, CDK “executed extensive testing,” consulted third-party specialists, and restored its main DMS and Digital Retailing capabilities by the afternoon.

CDK encountered another “cyber incident” on Wednesday evening, according to Finney in an update the next day. “We remain vigilant in our efforts to reinstate our services and get our dealers back to business as usual as quickly as possible,” she said.

When that will happen is unknown. As of Friday morning, a recorded message from CDK on a hotline providing updates for its customers stated that “we do not have an estimated time frame for resolution—and therefore our dealer systems will be unavailable, most likely for several days.” According to the statement, customer care assistance lines are also inaccessible.

The notice also stated that the company was aware of “bad actors” posing as CDK members or affiliates in an attempt to get system access by contacting customers. It advised employers to be wary of any attempted phishing.

dealerships

Dealerships | Bloomberg Image

Car Dealerships Are Being Disrupted By A Multi-Day Outage After Cyberattacks On Software Supplier

Several major automakers, including Stellantis, Ford, and BMW, reported to The Associated Press on Friday that the CDK outage had affected some of their dealers, but sales activities will continue.

In view of the current scenario, a Stellantis spokeswoman stated that many dealerships have moved to manual processes to assist consumers, including writing orders by hand.

A Ford representative stated that the disruption could result in “some delays and inconveniences at some dealers and for some customers.” However, many Ford and Lincoln customers continue to receive sales and service support through other avenues used at dealerships.

With many elements of the intrusions still unknown, client privacy is a primary priority, especially because little is known about what information may have been hacked this week.

dealerships

Dealerships | WSJ Image

Car Dealerships Are Being Disrupted By A Multi-Day Outage After Cyberattacks On Software Supplier

In a statement to the Associated Press on Friday, Mike Stanton, president and CEO of the National Automobile Dealers Association, said that “dealers are very committed to protecting their customer information and are actively seeking information from CDK to determine the nature and scope of the cyber incident so they can respond appropriately.”

SOURCE – (AP)

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AmEx Buys Dining Reservation Company Tock From Squarespace For $400M

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AmEx | Fast Company Image

NEW YORK — American Express will pay $400 million for Squarespace’s Tock meal reservation and event management software.

AmEx began making dining and event purchases five years ago with the purchase of Resy, which provided cardmembers with access to difficult-to-find restaurants and locations.

amex

AmEx | AP News Image

AmEx Buys Dining Reservation Company Tock From Squarespace For $400M

Other credit card difficulties have done the same thing. JPMorgan bought The Infatuation as a lifestyle brand in 2021.

Tock, founded in Chicago in 2014 and owned by Squarespace since 2021, offers reservation and table management services to about 7,000 restaurants and other venues.

Amex

AmEx | Yahoo Image

AmEx Buys Dining Reservation Company Tock From Squarespace For $400M

Tock has signed on restaurants such as Aquavit, a high-end Nordic restaurant in New York, and Chez Noir, a buzzy new restaurant in California.

Squarespace and Tock confirmed the acquisition on Friday.

AmEx’s purchase of Resy five years ago raised many heads in the credit card and dining industries. Since then, it’s become an important component of how the corporation secures high-end merchants to be AmEx-exclusive or to provide AmEx cardmembers with special treatment.

Amex

AmEx | Eat App Image

AmEx Buys Dining Reservation Company Tock From Squarespace For $400M

The number of eateries on the platform has increased fivefold.

AmEx also announced Friday that it will acquire Rooam, a contactless payment technology widely used in stadiums and other entertainment events. AmEx did not disclose the amount it paid for Rooam.

SOURCE – (AP)

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Under Armour To Pay $434 Million To Settle Lawsuit Over Sales Disclosures

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Under Armour | Retail Points Image

Under Armour announced on Friday that it has agreed to pay $434 million to settle a 2017 class action lawsuit. The lawsuit alleges that the sports clothing company deceived shareholders about its revenue growth to meet Wall Street expectations.

The proposed settlement, subject to court approval, avoids a trial scheduled for July 15 in Baltimore federal court.

under armour

Under Armour | Under Armour Image

Under Armour To Pay $434 Million To Settle Lawsuit Over Sales Disclosures

The shareholder lawsuit accused apparel firm CEO Kevin Plank of purposefully deceiving them about the company’s financial condition.

In 2021, the Baltimore-based corporation agreed to pay $9 million to settle Securities and Exchange Commission (SEC) claims of misleading investors about its revenue growth.

The SEC’s inquiry discovered that Under Armour failed to disclose to investors that it used a sales strategy to accelerate or “pull forward” a total of $408 million in existing orders in the second half of 2015.

under armour

Under Armour | CNN Image

Under Armour To Pay $434 Million To Settle Lawsuit Over Sales Disclosures

Mark Solomon, lead counsel for the shareholders and a partner at litigation firm Robbins Geller Rudman & Dowd, described the proposed settlement as an “important win,” highlighting pension funds’ critical role in keeping firms accountable.

Under Armour stated that it aims to pay the $434 million settlement with cash and rely on its $1.1 billion revolving credit facility.

In a regulatory statement, the business also stated that it has agreed to keep the roles of chairman and CEO distinct for at least three years.

under armour

Under Armour | Under Armour

Under Armour To Pay $434 Million To Settle Lawsuit Over Sales Disclosures

Under Armour stated that the company has repeatedly refuted the charges and engaged in this agreement in principle, which does not constitute an acknowledgment of fault or misconduct.

The business expects its total accrual in legal proceeding contingencies linked to the case to be $434 million in the first quarter of 2025, up from $100 million at the end of fiscal year 2024.

SOURCE – (CNN)

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