Tag Archives: antitrust

SOUTH DAKOTA ATTORNEY GENERAL JOINS SUIT AGAINST GOOGLE FOR ANTITRUST LAW VIOLATIONS OVER APP STORE

FOR IMMEDIATE RELEASE: Thursday, July 8, 2021

PIERRE, S.D. – Attorney General Jason Ravnsborg has joined a coalition of 37 attorneys general to file a lawsuit against Google in California. Utah v. Google alleges exclusionary conduct relating to the Google Play Store for Android mobile devices and Google Billing. This antitrust lawsuit is the newest legal action against the tech giant, claiming illegal, anticompetitive, and unfair business practices. The States accuse Google of using its dominance to unfairly restrict competition with the Google Play Store, harming consumers by limiting choice and driving up app prices. The lawsuit is co-led by AGs in Utah, New York, Tennessee, and North Carolina.

“Google’s monopoly is a menace to the marketplace. Google Play is not fair play. Google must be held accountable for harming small businesses and consumers,” said Utah Attorney General Reyes. “Most consumers have no idea that for years Google has imposed unnecessary fees far beyond the market rates for in-app transactions, unlawfully inflating costs for many services, upgrades and other purchases made through apps downloaded on the Google Play Store. As a result, a typical American consumer may have paid hundreds if not thousands of dollars more than needed over many years.” 

According to the lawsuit, the heart of the case centers on Google’s exclusionary conduct, which substantially shuts out competing app distribution channels. Google also requires that app developers that offer their apps through the Google Play Store use Google Billing as a middleman. This arrangement, which ties a payment processing system to an app distribution channel forces app consumers to pay Google’s commission—up to 30%—on in-app purchases of digital content made by consumers through apps that are distributed via the Google Play Store. This commission is much higher than the commission that consumers would pay if they had the ability to choose one of Google’s competitors instead. The lawsuit alleges that Google works to discourage or prevent competition, violating federal and state antitrust laws.  Google had earlier promised app developers and device manufacturers that it would keep Android “open source,” allowing developers to create compatible apps and distribute them without unnecessary restrictions. The lawsuit says Google did not keep that promise.  

When Google launched its Android OS, it originally marketed it as an “open source” platform. By promising to keep Android open, Google successfully enticed “OEMs”—mobile device manufacturers such as Samsung—and “MNOs”—mobile network operators such as Verizon—to adopt Android, and more importantly, to forgo competing with Google’s Play Store at that time. Once Google had obtained the “critical mass” of Android OS adoption, Google moved to    close the Android OS ecosystem—and the relevant Android App Distribution Market—to any effective competition by, among other things, requiring OEMs and MNOs to enter into various contractual and other restraints. These contractual restraints disincentivize and restrict OEMs and MNOs from competing (or fostering competition) in the relevant market. The lawsuit alleges that Google’s conduct constitutes unlawful monopoly maintenance, among other claims. 

The AGs further allege that Google also engaged in the following conduct, all aimed at enhancing and protecting Google’s monopoly position over Android app distribution:

Google imposes technical barriers that strongly discourage or effectively prevent third-party app developers from       distributing apps outside the Google Play Store. Google builds into Android a series of security warnings (regardless of actual security risk) and other barriers that discourage users from downloading apps from any source outside Google’s Play Store, effectively foreclosing app developers and app stores from direct distribution to consumers. 

 

Google has not allowed Android to be “open source” for many years, effectively cutting off potential competition. Google forces OEMs that wish to sell devices that run Android to enter into agreements called “Android Compatibility Commitments” or ACCs. Under these “take it or leave it” agreements, OEMs must promise not to create or implement any variants or versions of Android that deviate from the Google-certified version of Android. 

Google’s required contracts foreclose competition by forcing Google’s proprietary apps to be “pre-loaded” on essentially all devices designed to run on the Android OS, and requires that Google’s apps be given the most prominent placement on device home screens. 

Google “buys off” its potential competition in the market for app distribution. Google has successfully persuaded OEMs and MNOs not to compete with Google’s Play Store by entering into arrangements that reward OEMs and MNOs with a share of Google’s monopoly profits. 

Google forces app developers and app users alike to use Google’s payment processing service, Google Play Billing, to process payments for in-app purchases of content consumed within the app. Thus, Google is unlawfully tying the use of Google’s payment processor, which is a separate service within a separate market for payment processing within apps, to distribution through the Google Play Store. By forcing this tie, Google is able to extract an exorbitant processing fee as high as 30% for each transaction and which is more than ten times as high as the fee charged by Google’s competitors.  

This effort is led by Utah Attorney General Sean D. Reyes, New York Attorney General Letitia James, North Carolina Attorney General Josh Stein and Tennessee Attorney General Herbert Slatery III.  The other states joining the lawsuit include Alaska, Arkansas, Arizona, California, Colorado, Connecticut, Delaware, District of Columbia, Florida, Idaho, Indiana, Iowa, Kentucky, Maryland, Massachusetts, Minnesota, Mississippi, Missouri, Montana, Nebraska, Nevada, New Hampshire, New Jersey, New Mexico, New York, North Carolina, North Dakota, Oklahoma, Oregon, Rhode Island, Tennessee, Utah, Vermont, Virginia, Washington, and West Virginia.

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The Office of the Attorney General is the chief legal officer for the State of South Dakota and provides legal advice to agencies, boards, and commissions of the State as well as representing the State in state and federal court.  The Office of Attorney General also handles prosecutions, felony criminal appeals, civil matters, consumer protection issues, and issues formal opinions interpreting statutes for agencies of the state.  Visit www.atg.sd.gov to learn more. 

Connect with us on Facebook or on Twitter at @SDAttorneyGen

CONTACT: Tim Bormann, Chief of Staff, (605) 773-3215

 

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The Antitrust Case Against Facebook Is Very Much Alive

It’s the next step where the FTC ran into trouble. After defining the market, it had to show that Facebook has market power. If you take away only one thing from this article, let it be this: In antitrust law, having market power, also referred to as monopoly power, does not simply mean that a company is really big or influential. Market power has a specific, technical meaning: the ability to raise prices (or reduce quality) over an extended period of time without losing customers to the competition.

A common way to show market power is simply by showing that a company controls a massive share of the market. This approach, known as indirect evidence, is the one the FTC takes in its December filing. There’s just one problem. The sum total of the evidence it offers is the claim that Facebook “maintained a dominant share of the US personal social networking market (in excess of 60 percent).” Boasberg’s opinion understandably rakes the agency over the coals for this. Where does the 60 percent number come from? Sixty percent of what, exactly? (Users? Revenue? Time spent on the platform?) If Facebook doesn’t have any other major competitors, who is making up that remaining 30 to 40 percent? “These allegations—which do not even provide an estimated actual figure or range for Facebook’s market share at any point over the past ten years—ultimately fall short of plausibly establishing that Facebook holds market power,” Boasberg writes. “It is almost as if the agency expects the Court to simply nod to the conventional wisdom that Facebook is a monopolist.”

According to Rebecca Allensworth, an antitrust scholar at Vanderbilt Law School, the FTC may have had a good reason to try that approach. The past several decades of antitrust law have established narrow, technical tests for winning a monopolization case, and the doctrine is not designed with modern internet companies in mind. The FTC may have been gambling that an appeal to common sense would work better than a more technical economic argument.

“It’s a tradeoff between making an argument that fits within the kind of complicated set of case law that has grown up over the last 40 years, or making an argument that’s very intuitive and realistic,” she said. “If we take a big step back, the ultimate thing we’re asking is, ‘Does this company have power over the market? Does this company have power to decide what consumers are getting and aren’t getting, who will be allowed to compete and who won’t, or are they really feeling the bite of competition from others?’ I think from that perspective, which is what the whole case is supposed to be about, Facebook clearly has monopoly power.”

The fact that Boasberg didn’t buy that line of thinking doesn’t doom the FTC’s case. The judge gave the agency 30 days to come back with actual evidence to suggest that Facebook has market power. And his opinion goes one step further, by explicitly stating that the FTC’s proposed remedy—forcing Facebook to sell off Instagram and WhatsApp—remains on the table.

“I don’t think the court does that unless it is seriously contemplating a renewed complaint that would get past the motion to dismiss,” said Paul Swanson, an antitrust attorney in Denver. “The court is pretty clearly giving them another shot to plead market power; they just need to do it explicitly.”

So, how could the FTC strengthen its argument on round two? One way is to flesh out the indirect evidence of market share. Swanson suggested that the agency has already done most of the heavy lifting. Boasberg has already accepted its proposed market definition, which excludes all the other big social platforms besides Facebook-owned Instagram. And so it shouldn’t be hard to convince him that Facebook has a commanding share of that market. The agency might just need to be more explicit about it, and explain what data it’s relying on.

Author: Gilad Edelman
This post originally appeared on Business Latest

Facebook Antitrust Cases Brought By FTC and States Are Thrown Out

The state suit was signed by attorneys general from 46 states and the District of Columbia and Guam. Alabama, Georgia, South Carolina and South Dakota did not join the case.

Facebook asked the court to dismiss both suits in March. The company argued that it was continually challenged with competition, including from new rivals such as TikTok. It also argued that the regulators had failed to prove how the services, which are free, harmed consumers. The judge’s dismissal of both suits, so early in process, stunned regulators and Facebook executives.

The judge, James E. Boasberg of U.S. District Court for the District of Columbia, wondered why the states had waited so long to try to unwind Facebook’s deals for Instagram and WhatsApp. Regulators had not tried to block them when they happened. He also rejected allegations that Facebook squashed rival apps by blocking their ability to easily interact with the social media platform.

“Ultimately, this antitrust action is premised on public, high-profile conduct, nearly all of which occurred over six years ago,” he wrote, “before the launch of the Apple Watch or Alexa or Periscope, when Kevin Durant still played for the Oklahoma City Thunder and when Ebola was the virus dominating headlines.”

Judge Boasberg, who was appointed to his current post by President Barack Obama, said the F.T.C. did not sufficiently prove that Facebook was a monopoly. He said the agency’s definition for social media was too vague, and in a reference to an interpretation of antitrust law prevalent in courts that is anchored in consumer prices, he noted that the product was free.

“It is almost as if the agency expects the court to simply nod to the conventional wisdom that Facebook is a monopolist,” he wrote. “After all, no one who hears the title of the 2010 film ‘The Social Network’ wonders which company it is about.”

But, he said, “‘monopoly power’ is a term of art under federal law with a precise economic meaning.”

Author: Cecilia Kang
This post originally appeared on NYT > Top Stories

Antitrust Overhaul Passes Its First Tests. Now, the Hard Parts.

WASHINGTON — Capitol Hill politicians have groused for years about the power and influence of the country’s largest tech companies. But they took little action to match their rhetoric.

That started to change on Wednesday, when House lawmakers took their first votes on a suite of bills that are meant to weaken the dominance of Big Tech. The bills, six in all, would bulk up antitrust agencies, make it harder to acquire potential rivals, and prevent platforms from selling or promoting their own products to disadvantage competitors.

The votes by members of the Judiciary Committee to advance some of the bills showed the growing bipartisan agreement for taking on the tech companies. A handful of Republicans joined the widespread support among Democrats for the bills.

The committee members debated the bills through the night until adjourning shortly after 5 a.m. on Thursday. Discussions are expected to resume later in the morning.

But the outcome of the votes, and the debates before they took place, also exposed the fault lines among Republicans and Democrats — and underscored why final passage of all the bills is expected to be difficult.

Democrats, who have had the most say over the bills, are focused on the market power of Amazon, Apple, Facebook and Google. Representative Jerrold Nadler of New York, the Democratic chairman of the committee, said the votes “pave the way for a stronger economy and a stronger democracy for the American people by reining in anti-competitive abuses of the most dominant firms online.”

Some Republicans have united with them, arguing that the proposals would help address one of their main concerns: the power that social media companies have over speech, and what they argue is political bias and censorship of conservative voices. But many other Republicans say that the bills only add more government intervention into the economy while not directly addressing their concerns about free speech.

That debate within the Republican Party spilled out on Wednesday as soon as the first bill was brought up for a vote. The proposal, considered among the least contentious of the six, would increase the costs of fees associated with some mergers, to help raise more funding for the Federal Trade Commission, which helps regulate deals.

During a three-hour debate about the bill, Representative Jim Jordan of Ohio, the top Republican on the committee, said the bill was a power grab for the Democratic-led antitrust agencies, making them bigger and more influential. He also said the proposals and the other antitrust bills failed to address the ability of Facebook and other social media companies to cut off political voices.

“Big tech censors conservatives,” Mr. Jordan said. “These bills don’t fix that problem, they make it worse.”

Representative Ken Buck of Colorado, a fellow Republican and a co-sponsor of the bills, agreed that the tech companies silence conservatives. But he implored his party for unity to take on the power of Big Tech through the proposals, which he said would limit the overall power of the companies.

“These bills are conservative,” Mr. Buck said.

While progressive lawmakers largely back the bills, the proposals have frustrated Democratic lawmakers from California, who say they go too far in regulating their state’s most prominent companies.

Representative Lou Correa, a Democrat from Southern California, said that the number of people in the state working for the big tech companies had grown substantially, helping the state fund services like public education and support for people affected by Covid.

“We want to make sure that we don’t kill the goose that lays the golden eggs,” he added later.

Mr. Correa also said: “These firms — high tech — are the reason California has a budget surplus, as opposed to a deficit, enabling the state of California to invest in public education, to help those affected by Covid, the middle class, those who are trying to get to the middle class.”

Other California Democrats who expressed concerns about the bills included Representative Zoe Lofgren, whose district includes part of San Jose, and Representative Eric Swalwell.

Ms. Lofgren worried during the hearing that the bills could ensnare companies that do not share the tech giants’ immense scale. Mr. Swalwell said before the hearing even began that he would oppose several of the bills.

“In my district alone, I represent thousands — likely in the five digits — of employees affected by the proposed laws,” he said. “It is these people whose jobs, families and livelihoods I was elected to protect — and must advocate for today.”

The committee’s passage of the bills kicks off a much harder process. Eight Democratic lawmakers have asked Speaker Nancy Pelosi, who has tremendous sway over when bills are taken up in the full House, to slow the process. The lawmakers repeated arguments made by companies like Apple that say the bills could open up security and privacy vulnerabilities for customers.

The challenge is even stiffer in the Senate, where the bills will each require significant Republican support to reach the needed 60 votes. A few Republicans, including Josh Hawley of Missouri, have pressed for stiffer antitrust laws. But it is unclear whether many more will join him.

Some bills, like the one to generate more money for the Federal Trade Commission, could face less resistance than others. The most contentious is a bill that bans platforms from selling their own products, such as Amazon selling its own branded Amazon Basics toilet paper and putting rivals like Charmin at a disadvantage.

“We think it’s an uphill climb for the toughest bills,” said Paul Gallant, a research analyst at Cowen and Company. “The Senate filibuster is always the highest hurdle and I suspect it will hold back the toughest of these bills. But the House is going faster and farther against tech than anyone expected.”

The bills face fierce opposition from technology companies that have marshaled their considerable lobbying operations. Ahead of the votes on Wednesday, Apple sent a letter to committee leaders warning that the if the bills were passed, the company would not be able to offer certain privacy and security features for users. Think tanks and lobbying groups funded by tech companies issued critical statements before the votes.

The bills “single out a handful of America’s most innovative and globally competitive tech companies for divestiture and draconian regulation,” said Alec Stapp, a director of the Progressive Policy Institute, a nonprofit think tank that received sponsorship from tech companies.

Chamber of Progress, a newly formed tech trade group representing Amazon and Google, said a recent Morning Consult Survey showed that voters didn’t see tech regulation as a top priority.

“Consumers want the government to scrutinize and regulate the tech industry, but don’t want Congress redesigning the apps and services that make their lives easier,” said its chief executive, Adam Kovacevich.

Alex Harman, a competition policy advocate at Public Citizen, which had been pushing for the bills, said Wednesday’s votes represented an important moment. Almost a decade ago, he said, there had been little Capitol Hill support for an investigation of Google’s practices by the Federal Trade Commission, which ultimately decided not to pursue a case against the company.

“Nine years later, we are in a world where a serious bipartisan effort in a committee is not just trying to push on an investigation, they’re trying to break them up,” he said. “That is a big deal.”

Author: Cecilia Kang and David McCabe
This post originally appeared on NYT > Top Stories

A New Antitrust Case Cuts to the Core of Amazon’s Identity

“I founded Amazon 26 years ago with the long-term mission of making it Earth’s most customer-centric company,” Jeff Bezos testified before the House Antitrust Subcommittee last summer. “Not every business takes this customer-first approach, but we do, and it’s our greatest strength.”

Bezos’ obsession with customer satisfaction is at the center of Amazon’s self-mythology. Every move the company makes, in this account, is designed with only one goal in mind: making the customer happy. If Amazon has become an economic juggernaut, the king of ecommerce, that’s not because of any unfair practices or sharp elbows; it’s simply because customers love it so much.

The antitrust lawsuit filed against Amazon on Tuesday directly challenges that narrative. The suit, brought by Karl Racine, the Washington, DC, attorney general, focuses on Amazon’s use of a so-called most-favored-nation clause in its contracts with third-party sellers, who account for most of the sales volume on Amazon. A most-favored-nation clause requires sellers not to offer their products at a lower price on any other website, even their own. According to the lawsuit, this harms consumers by artificially inflating prices across the entire internet, while preventing other ecommerce sites from competing against Amazon on price. “I filed this antitrust lawsuit to put an end to Amazon’s ability to control prices across the online retail market,” Racine said in a press conference announcing the case.

For a long time, Amazon openly did what DC is alleging; its “price parity provision” explicitly restricted third-party sellers from offering lower prices on other sites. It stopped in Europe in 2013, after competition authorities in the UK and Germany began investigating it. In the US, however, the provision lasted longer, until Senator Richard Blumenthal wrote a letter to antitrust agencies in 2018 suggesting Amazon was violating antitrust law. A few months later, in early 2019, Amazon dropped price parity.

But that wasn’t the end of the story. The DC lawsuit alleges that Amazon simply substituted a new policy that uses different language to accomplish the same result as the old rule. Amazon’s Marketplace Fair Pricing Policy informs third-party sellers that they can be punished or suspended for a variety of offenses, including “setting a price on a product or service that is significantly higher than recent prices offered on or off Amazon.” This rule can protect consumers when used to prevent price-gouging for scarce products, as happened with face masks in the early days of the pandemic. But it can also be used to inflate prices for items that sellers would prefer to offer more cheaply. The key phrase is “off Amazon. In other words, Amazon reserves the right to cut off sellers if they list their products more cheaply on another website—just as it did under the old price parity provision. According to the final report filed by the House Antitrust Subcommittee last year, based on testimony from third-party sellers, the new policy “has the same effect of blocking sellers from offering lower prices to consumers on other retail sites.”

The main form that this price discipline takes, according to sellers who have spoken out against Amazon either publicly or in anonymous testimony, is through manipulating access to the Buy Box—those Add to Cart and Buy Now buttons at the top right of an Amazon product listing. When you go to buy something, there are often many sellers trying to make the sale. Only one can “win the Buy Box,” meaning they’re the one who gets the sale when you click one of those buttons. Because most customers don’t scroll down to see what other sellers are offering a product, winning the Buy Box is crucial for anyone trying to make a living by selling on Amazon. As James Thomson, a former Amazon employee and a partner at Buy Box Experts, a brand consultancy for Amazon sellers, told me in 2019, “If you can’t earn the Buy Box, for all intents and purposes, you’re not going to earn the sale.”

Jason Boyce, another longtime Amazon seller turned consultant, explained to me how this works. He and his partners were excited when the last third-party seller contract they signed with Amazon, to sell sporting goods on the site, didn’t include the price parity provision. “We thought, ‘This is great! We can offer discounts on Walmart, and Sears, and wherever else,’” he said. But then something odd happened. Boyce (who spoke with House investigators as part of the antitrust inquiry) noticed that once his company lowered prices on other sites, sales on Amazon started tanking. “We went to the listing, and the Add to Cart button was gone, the Buy Now button was gone. Instead, there was a gray box labeled ‘See All Buying Options.’ You could still buy the product, but it was an extra click. Now, an extra click on Amazon is an eternity—they’re all about immediate gratification.” Moreover, his company’s ad spending plummeted, which he realized was because Amazon doesn’t show users ads for products without a Buy Box. “So what did we do? We went back and raised our prices everywhere else, and within 24 hours everything came back. Traffic improved, clicks improved, and sales came back.”

Author: Gilad Edelman
This post originally appeared on Business Latest

Coca Cola in EU antitrust regulators’ crosshairs

© Reuters. FILE PHOTO: Bottles of Coca-Cola are displayed at a supermarket of Swiss retailer Denner, as the spread of the coronavirus disease (COVID-19) continues, in Glattbrugg, Switzerland June 26, 2020. REUTERS/Arnd Wiegmann

BRUSSELS (Reuters) -EU antitrust regulators have launched a preliminary investigation into Coca Cola Co, the European Commission said on Friday.

“We can confirm that the Commission has sent out questionnaires, as part of its preliminary investigation into Coca Cola,” a Commission spokeswoman said.

“The preliminary investigation is ongoing. We cannot comment on or predict its timing or outcome,” she said, declining to provide further details.

Coca Cola said it received a formal request for information on Thursday.

“While we will co-operate fully with the Commission, it would be inappropriate for us to comment further while the process is on-going. We abide by European competition law, as well as all other applicable laws and regulation,” a Coca Cola spokesman said.

Lobbying group EuroCommerce, whose members include Carrefour (PA:), Ikea, Metro and Tesco (OTC:), said the sales practices of some large multinational brands were a concern to retailers and wholesalers.

“We have for many years pointed to the problems our sector faces with the makers of ‘must-have’ products using their market power to impose unilateral conditions and limit competition to their advantage,” EuroCommerce Director-General Christian Verschueren said in a statement.

German media Lebensmittelzeitung was the first to report about the EU investigation.

By Foo Yun Chee

Author: Reuters
This post originally appeared on Stock Market News

Apple’s App Store Chief Fends off Attacks in Antitrust Trial

SAN RAMON, Calif. (AP) — Apple’s top app store executive on Thursday faced an avalanche of documents unleashed Thursday by an Epic Games lawyer aiming to prove allegations that the iPhone maker has been gouging app makers as part of a scheme hatched by Apple’s late co-founder Steve Jobs.

The confrontation in an Oakland, California, courtroom came during the fourth day of an antitrust trial targeting the empire that Apple has built around its iPhone and the digital storefront that serves as the exclusive outlet for people to install apps on the ubiquitous device.

Epic, the maker of the popular Fortnite video game, contends Apple’s insistence that apps to pay a 15% to 30% commission on transactions has turned into illegal monopoly that that should be blown up so other options can be offered on the iPhone, iPad and iPod.

Apple so far has mounted a fierce defense of its so-called “walled garden,” in part by highlighting evidence that its app store commissions and practices mirror those of major video game consoles such as PlayStation, Xbox and Switch that Epic has embraced.

After spending the first three days of the trial soliciting testimony from Epic’s own executives and other parties sympathetic to the company’s case, Epic attorney Katherine Forrest and her supporting team took their first stab an Apple executive — Matt Fischer, who has been running the app store since 2010.

While Fischer was on the witness stand, Forrest repeatedly asked him to review e-mails and slide presentations revolving around the app store’s finances, concerns about fraudulent activity and complaints about Apple highlighting its own services in the search results in the app.

Although significant sections of the documents were redacted to shield confidential business information, they still revealed intriguing tidbits.

For instance, a November 2010 slide presentation showed that the app store already had generated $ 2.1 billion in billings — far more than Jobs envisioned when he came up with the idea in 2008, a year after release of the first iPhone.

Not long after the app store opened, Jobs speculated that it at most might become a $ 1 billion business. “We don’t expect this to be a big profit generator,” Jobs said in an interview that Fischer shared with his team in July 2018 as a reminder of how far the app store had come since its inception.

Epic contends app store’s unexpectedly fast start prompted Jobs, who died in August 2011, to shift gears and draw up a new strategy to trap iPhone users by building the walled garden around the device and the app store. Fischer told Forrest that he never heard of such a plan, although he conceded it was possible the strategy was created before he took over management of the app store and was never told about it.

Apple has never revealed how much money it makes from the app store but estimates have pegged its annual profit at $ 15 billion to $ 18 billion. The Cupertino, California, company has disclosed that it has invested more than $ 100 billion in the iPhone and its supporting software, including the app store, to help support its argument that Epic simply wants to freeload off its innovations by evading commissions that have been in place for more than a decade.

Epic also tried to cast doubt on one of Apple’s justifications for forbidding other app stores on the iPhone. Apple says its walled garden and commissions help protect consumers against malicious activity that could defraud them and invade their personal privacy.

Forrest confronted Fischer with a variety of documents raising security questions, including a July 2018 email in which he worried about “an epidemic of apps that are trying to to defraud consumers.”

Under questioning by an Apple lawyer, Fischer said he wasn’t responsible for the store’s privacy, security and fraud controls.

“We have been fighting and combatting fraud for a long time,” Fischer testified on the stand.

Author: AP News
This post originally appeared on Snopes.com

Apple faces down ‘Fortnite’ creator Epic Games in major antitrust trial

© Reuters. Fortnite graphic and Apple logo displayed in illustration

(Reuters) -Attorneys for “Fortnite” creator Epic Games and Apple Inc (NASDAQ:) will make opening arguments Monday at an antitrust trial whose ultimate outcome could affect Apple’s fast-growing App Store business.

The lawsuit, which Epic brought last year in the U.S. District Court for the Northern District of California, centers on two of Apple practices that have become cornerstones of its business: Apple’s requirement that virtually all third-party software for the world’s 1 billion iPhones be distributed through its App Store, and the requirement that developers use Apple’s in-app purchase system, which charges commissions of up to 30%.

Judge Yvonne Gonzalez Rogers (NYSE:) will preside over the three-week trial in a courtroom in Oakland, California. Apple’s legal team from Gibson, Dunn & Crutcher arrived at the courthouse Monday morning with about 20 boxes of documents, followed by Phil Schiller, Apple’s App Store chief. Epic’s legal team from Cravath, Swaine & Moore arrived with a similar number of boxes and followed by Epic Games Chief Executive Tim Sweeney.

Both executives are expected to attend the entire trial, which will also feature in-person testimony from Apple Chief Executive Tim Cook and other senior executives at both firms.

Epic broke Apple’s rules last year when it introduced its own in-app payment system in “Fortnite” to circumnavigate Apple’s commissions. In response, Apple kicked Epic off its App Store.

Epic sued Apple, alleging the iPhone maker is abusing its power of app developers with App Store review rules and payment requirements that hurt competition in the software market. Epic also launched an aggressive public relations campaign to call attention to its allegations just as Apple’s practices have come under scrutiny from lawmakers and regulators in the United States and elsewhere.

Apple has countered Epic’s allegations by arguing that its App Store rules have made consumers feel safe and secure in opening their wallets up to unknown developers, helping create a massive market that all developers have benefited from. Apple argues that Epic intentionally broke its contracts with Apple because the game maker wanted a free ride on the iPhone maker’s platform.

Epic is not asking for money damages but is asking the court to hand down orders that would end many of Apple’s practices.

Therefore doesn`t .

By Stephen Nellis

Author: Reuters
This post originally appeared on Stock Market News

EU antitrust fine could cost Apple 10% of its global revenue – reports

Author: RT
This post originally appeared on RT Business News

EU regulators will reportedly charge Apple with anticompetitive behavior as soon as this week. The first EU antitrust case against the US tech firm comes two years after a complaint by music streaming service Spotify.

The violation may incur a fine of as much as 10% of Apple’s global revenue, as well as forcing the tech giant to take a new look at its lucrative business model.

In 2019, Swedish audio streaming and media services provider Spotify filed a complaint to the European Commission, alleging that the iPhone maker unfairly restricts rivals to Apple Music, its music steaming service. The Stockholm-based company also said that Apple forces app developers to pay a 30% fee to use its in-app purchase system (IAP), making it difficult for Apple Music rivals to market themselves.

Also on rt.com Russian anti-monopoly agency hits Apple with $ 12m fine for ‘anti-competitive’ policy as Silicon Valley firm insists it will appeal

Shortly after the accusations, Apple issued a response to Spotify’s complaint, saying that the App Store had facilitated hundreds of millions of downloads of the Spotify app.

“Spotify wraps its financial motivations in misleading rhetoric about who we are,” the Cupertino-based corporation said back then.

In June 2020, the EU competition enforcer launched antitrust probes into Apple, investigating the App Store and Apple Pay.

The EU’s chief for competition and digital policy, Margrethe Vestager, is expected to issue the charges publicly later this week, according to multiple media reports, including those by Reuters, FT, and Bloomberg.

Also on rt.com Apple App Store investigated by UK competition authority over antitrust complaint

The case against Apple comes amid rising competition concerns across the world, marking large scale regulatory crackdowns against the power of Big Tech.

Earlier this week, the German Advertising Federation filed an antitrust complaint over iPhone’s latest privacy settings, alleging that Apple abuses its dominant market position and violates antitrust regulations via the new iOS update.

Apple, Facebook, Amazon, Alphabet’s Google, and others among American Big Tech are expected to fall under the Digital Services Act and Digital Markets Act, introduced by the European Commission in late 2020, which is currently waiting for approval by the European Parliament and Council of Ministers. The regulation aims to introduce rules across Europe that tech companies must abide by. It aims to make the online market space safer and create a level playing field for companies within it.

For more stories on economy & finance visit RT’s business section

Fine with a fine: Alibaba accepts all-time high $2.8bn penalty from Chinese antitrust regulator

China’s antitrust regulators have hit Alibaba Group, the world’s largest e-commerce corporation, with an 18.2 billion yuan ($ 2.8 billion) fine, the highest penalty of its kind on record.

The fine imposed on Alibaba is nearly three times higher than the 6.1-billion-yuan penalty imposed on Qualcomm, the world’s largest supplier of mobile chips, six years ago.

Moreover, Alibaba has been obliged to file self-examination and compliance reports to the State Administration for Market Regulation (SAMR) for three years.

The company said it “accepts the penalty with sincerity and will ensure its compliance with determination.”
Also on rt.com China denies plans to fine Alibaba nearly $ 1 billion in anti-monopoly case
“To serve its responsibility to society, Alibaba will operate in accordance with the law with utmost diligence, continue to strengthen its compliance systems and build on growth through innovation,” the company said.

The fine, which amounts to nearly 4% of the Alibaba’s revenue in 2019, comes after a months-long antitrust investigation. The case has reportedly set the precedent that will enable Chinese authorities to regulate the country’s Big Tech by means of anti-monopoly rules.

According to the SAMR, Alibaba had “abused its dominant market position in China’s online retail platform service market since 2015 by forcing online merchants to open stores or take part in promotions on its platforms.”
Also on rt.com China plans to turn up heat in crackdown on monopolies after opening probe into online giant Alibaba
The approach had been forcing merchants to choose one of two platforms, rather than being able to work with both. That allowed the e-commerce giant to bolster its position in the market and gain unfair competitive advantages, in breach of the country’s anti-monopoly law.

The penalty comes as the latest development in China’s crackdown on its technology companies. The country’s tech giants, particularly the ones operating in the financial sector, have been under close attention from the Chinese government, amid its increasing power.
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Chinese billionaire Jack Ma, the founder of both Alibaba and Ant Group, a financial platform that evolved from Alibaba’s payments service, Alipay, has recently become the focus of this intense scrutiny.

Ant’s long-anticipated stock market debut was halted in November after Chinese regulators introduced new rules on online micro-lending, a key part of its business. The China Securities Regulatory Commission also summoned Ma and other Ant execs.

The billionaire reportedly came under fire for criticizing Chinese regulators. Ma dropped out of the spotlight for months, evoking widespread speculation over his whereabouts after he gave a speech at a Shanghai conference, accusing officials of having a “pawnshop mentality” that stunted business growth and innovation in China.

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