It seems like Apple is under constant scrutiny for its anti-competitive behaviour all around the world. Today, The Federal Cartel Office, the Bundeskartellamt, has announced that it will start investigating Apple for claims of anti-competitive behaviour, related to the App Store, its Apple products and other services.
During the investigation, the Bundeskartellamt will try to determine whether Apple holds too much power “across markets”, and whether its ecosystem makes it more difficult for other companies to challenge it.
“Today the Bundeskartellamt has initiated the first step against Apple in a proceeding to determine whether the company is of paramount significance across markets. An ecosystem which extends across various markets may be an indication that a company holds such a position. It is often very difficult for other companies to challenge such a position of power.”
Clearly, the company is being investigated for its business practices. In the following statement, Andreas Mundt tells us that all of Apple’s devices and services will be taken a thorough look into how they operate, what data they collect and how that data is then being used. The main focus of the investigation will stay on the App Store.
Andreas Mundt, the President of the Bundeskartellamt said the following:
“We will now examine whether with its proprietary operating system iOS, Apple has created a digital ecosystem around its iPhone that extends across several markets. Apple produces tablets, computers and wearables and provides a host of device-related services. In addition to manufacturing various hardware products, the tech company also offers the App Store, iCloud, AppleCare, Apple Music, Apple Arcade, Apple TV+ as well as other services as part of its services business. Besides assessing the company’s position in these areas, we will, among other aspects, examine its extensive integration across several market levels, the magnitude of its technological and financial resources and its access to data. A main focus of the investigations will be on the operation of the App Store as it enables Apple in many ways to influence the business activities of third parties.”
It’s unclear how long this proceeding is going to take, and we also don’t know what actions are going to be taken against Apple, if found to be anti-competitive. One thing is certain, there are a lot of complaints against the company, not only in Germany, but also in the US, Europe and elsewhere. The App Tracking Transparency framework that was introduced in iOS 14.5 has also received a number of complaints. According to the release, the pre-installation of Apple’s own apps are also on the watchlist.
“Based on this first proceeding, the Bundeskartellamt intends to assess in more detail specific practices of Apple in a possible further proceeding. In this regard, the authority has received various complaints relating to potentially anti-competitive practices. These include, among others, an association complaint from the advertising and media industry against Apple restricting user tracking with the introduction of its iOS 14.5 operating system, and a complaint against the exclusive pre-installation of the company’s own applications as a possible type of self-preferencing prohibited under Section 19a GWB. App developers also criticise the mandatory use of Apple’s own in-app purchase system (IAP) and the 30 percent commission rate associated with this. In this context, the marketing restrictions for app developers in Apple’s App Store are also addressed. The latter complaint has much in common with the European Commission’s ongoing proceeding against Apple for imposing restrictions on the streaming service Spotify and accordingly preferencing its own services. Where necessary, the Bundeskartellamt will establish contact with the European Commission and other competition authorities in this regard. So far, no decision on initiating a further proceeding has been taken.”