IPhone more expensive due to Apple web apps deal, class action lawsuit alleges

iPhone lawsuit overview: 

• Who: Apple is facing a class action lawsuit from three iPhone buyers claiming that it has illegally maintained a duopoly with Google over smartphones. 
• Why: Apple made deals with web browsers to prevent the entry of third-party apps that don’t come through the App Store, allowing Apple to block competitors from the marketplace, the lawsuit claims.
• Where: The iPhone lawsuit was filed in federal court in California.

A new antitrust class action lawsuit claims Apple is able to charge above-market prices for the iPhone due to agreements it put in place to block web-based apps outside the App Store.

Apple attempts to block progressive web apps (PWA) from being downloaded and used through a web browser engine through deals that Apple made with those browser operators, the Apple antitrust lawsuit says.

Browsers on the Apple iOS system use the company’s WebKit engine — which doesn’t allow web-based apps to be used at all — rather than their own engines. Apple’s deals with other browser operators effectively ensure that other options like Google Chrome and Mozilla Firefox are actually just running as alternative versions of Safari when used on iPhones, the Apple antitrust class action claims.

The deals also discourage developers from creating web-based apps, as Apple held 53% of the U.S. smartphone market as of 2023. This benefits Apple’s biggest competitor, Google, by disincentivizing other would-be competitors from entering the field.

“Companies that have developed advanced, full-featured browser engines that could serve as cross-platform launching pads for PWAs across both major mobile ecosystems have agreed with Apple not to do so on iPhone,” the iPhone lawsuit says. “Notably, Apple made such an agreement with its direct, horizontal competitor in both the smartphone and smartphone OS markets, Google.”

Google uses its own web browser engine, Blink, in every other format outside of iOS.

The Apple antitrust lawsuit was filed Jan. 25 in a California federal court by three iPhone buyers. Google is not named as a defendant in the lawsuit.

Deals ‘ensure that no true cross-platform browser engine can exist’ in U.S., iPhone lawsuit says

Apple’s deals with browser operators have prevented other companies from meaningfully entering the smartphone marketplace, including Microsoft’s failed attempts at marketing a Windows phone, the Apple antitrust lawsuit argues.

“By ensuring that developers who seek to write once and deploy on a cross-platform browser engine are excluded from 136 million U.S. smartphones, Apple’s agreements restricting browser engine functionality on iOS ensure that no true cross-platform browser engine can exist in the United States,” the iPhone lawsuit says.

Apple recently agreed to pay $35 million to resolve claims that its iPhone 7 and 7 Plus devices had defective audio chips, causing audio problems for users.

Would you like to be able to download an app outside of the App Store on an iOS device? Let us know in the comments.

The plaintiff is represented by Yavar Bathaee, Brian J. Dunne, Edward M. Grauman and Andrew C. Wolinsky of Bathaee Dunne LLP. 

The Apple iPhone antitrust class action lawsuit is Bakay, et al. v. Apple Inc., Case No. 5:24-cv-00476, in the U.S. District Court for the Northern District of California.

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