A UK group led by Dr. Rachael Kent from King's College London has filed a class action lawsuit against Apple for $2 billion. The lawsuit has been filed against Apple in regard to the fees and commissions it charges developers for the App Store.
Apple Faces a New Lawsuit Over App Store Fees
The group filed the collective action suit (the UK equivalent of a class action lawsuit) alleging that Apple "guards access to the world of apps jealously". Seeking $2 billion in damages, the group claims that Apple's commission for the App Store is "completely unjustified".
According to the lawsuit, charging these fees is "the behavior of a monopolist and unacceptable". The group also claims that Apple deliberately tries to discourage competition by requiring users to make payments through Apple's service rather than an app's own service.
This group's lawsuit isn't the only dispute about Apple's fees for the App Store. Currently, Apple is engaged in a headline-grabbing lawsuit against Epic Games over App Store anti-competitiveness, and other bodies have claimed the same.
If successful, this lawsuit could see up to 20 million Apple customers in the UK receiving compensation. If approved, this compensation would be available for those UK customers that have purchased an app, in-app purchase, or subscription since October 2015.
Since the lawsuit was filed, Apple has made a statement in which it says "we believe this lawsuit is meritless". Despite this, the company made it clear it is willing to have the discussion in court. Apple also cited its "unwavering commitment to consumers" and the "UK's innovation economy".
In the lawsuit, the group who filed it will need to actively proof that Apple has been "unjustified" with fees and discourages competition on the App Store, as they claim. It is likely that Apple will be able to use some of the same defense and evidence as in other disputes.
Apple's App Store Fees
Currently, Apple charges a 30 percent commission on payments through the App Store. This means that for every app purchase, in-app purchase, or subscription, Apple takes 30 percent of the cost. For example, with a $0.99 in-app purchase Apple would receive roughly $0.30, and the developer $0.69.
In Apple's statement, the company mentioned that 84 percent of apps on the App Store are free and therefore exempt from any fees. Apple also said that the "vast majority" of developers are eligible for Apple's lower commission of 15 percent through the App Store Small Business Program.
Apple only charges developers fees for purchases through the App Store, and bar the $99/year spend for a Developer account, releasing an app through the App Store completely free otherwise.
Big Tech Is Increasingly Under Attack
With recent lawsuits against Apple and other companies over alleged anti-competitive behavior, it seems that big tech is under attack. Many people are focusing on ethics rather than business, and big tech companies may have to implement changes that worsen the user experience as a result.
As the lawsuit plays out, it will become clear whether the claims hold any truth. Either way, the result could set a precedent for the future and may require Apple to change its fee structure.