Lawsuit alleges Apple blocks cloud gaming apps to stifle Apple Arcade competition
A new class action lawsuit alleges that Apple enjoys monopoly power in the iOS mobile gaming marketplace, and exhibits anticompetitive behavior to keep it that way.
Credit: Apple
The complaint, lodged in the U.S. District Court for the Northern District of California, claims that Apple has "unlawfully [foreclosed] competition" through "persistent, pervasive, and secretive" misconduct.
New Jersey man John Pistacchio, the plaintiff in the case, claims to be paying "supracompetitive prices" for Apple Arcade as a result of the company's alleged anticompetitive behavior.
More specifically, the lawsuit suggests that Apple exerts monopoly power over the iOS App Store by requiring developers to follow its app guidelines and by prohibiting third-party app stores. It adds that developers and app publishers are "powerless to constrain" Apple's conduct by refusing to publish apps on iOS.
"No developer or group of developers have sufficient power to entice enough iOs users to leave iOS, such that developing apps solely for other platforms would be profitable," the complaint reads, suggesting that companies like Microsoft, Facebook, and Google fall into that category.
The complaint goes on to claim that Apple exhibits anticompetitive behavior to maintain its monopoly status in iOS subscription-based gaming services.
Those alleged anticompetitive behaviors include imposing technical restrictions to prevent users from playing other services besides Apple Arcade; imposing contractual restrictions on developers; abusing its app review guidelines to protect its monopoly; and rejecting cloud-based subscription platforms.
It cites several instances of alleged anticompetitive behavior, such as Apple's prohibition on cloud gaming apps like Xbox Game Pass and its treatment of gaming services like Facebook Gaming.
Furthermore, the lawsuit suggests that Apple blocks competing game services not because they violate its app review guidelines, but because they are rivals to Apple Arcade. (Apple Arcade, in fact, complies with all of Apple's own guidelines.)
"Apple has taken advantage of its dual role as both gatekeeper and market player, repeatedly abusing its monopoly power to prevent competition with Apple Arcade. Apple's anti-competitive conduct forecloses competition in the iOS Subscription-Based Mobile Gaming Market, affects a substantial volume of commerce in this market, and causes anticompetitive harms to consumers," the complaint reads.
The lawsuit urges a jury trial, and seeks compensatory damages and punitive damages, injunctive relief for the plaintiff and class, statutory interest and penalties, and legal fees.
Additionally, it asks the court to establish a "constructive trust into which Apple's ill-gotten gains shall be disgorged and from which Plaintiff and members of the Class may obtain restitution."
Credit: Apple
The complaint, lodged in the U.S. District Court for the Northern District of California, claims that Apple has "unlawfully [foreclosed] competition" through "persistent, pervasive, and secretive" misconduct.
New Jersey man John Pistacchio, the plaintiff in the case, claims to be paying "supracompetitive prices" for Apple Arcade as a result of the company's alleged anticompetitive behavior.
More specifically, the lawsuit suggests that Apple exerts monopoly power over the iOS App Store by requiring developers to follow its app guidelines and by prohibiting third-party app stores. It adds that developers and app publishers are "powerless to constrain" Apple's conduct by refusing to publish apps on iOS.
"No developer or group of developers have sufficient power to entice enough iOs users to leave iOS, such that developing apps solely for other platforms would be profitable," the complaint reads, suggesting that companies like Microsoft, Facebook, and Google fall into that category.
The complaint goes on to claim that Apple exhibits anticompetitive behavior to maintain its monopoly status in iOS subscription-based gaming services.
Those alleged anticompetitive behaviors include imposing technical restrictions to prevent users from playing other services besides Apple Arcade; imposing contractual restrictions on developers; abusing its app review guidelines to protect its monopoly; and rejecting cloud-based subscription platforms.
It cites several instances of alleged anticompetitive behavior, such as Apple's prohibition on cloud gaming apps like Xbox Game Pass and its treatment of gaming services like Facebook Gaming.
Furthermore, the lawsuit suggests that Apple blocks competing game services not because they violate its app review guidelines, but because they are rivals to Apple Arcade. (Apple Arcade, in fact, complies with all of Apple's own guidelines.)
"Apple has taken advantage of its dual role as both gatekeeper and market player, repeatedly abusing its monopoly power to prevent competition with Apple Arcade. Apple's anti-competitive conduct forecloses competition in the iOS Subscription-Based Mobile Gaming Market, affects a substantial volume of commerce in this market, and causes anticompetitive harms to consumers," the complaint reads.
The lawsuit urges a jury trial, and seeks compensatory damages and punitive damages, injunctive relief for the plaintiff and class, statutory interest and penalties, and legal fees.
Additionally, it asks the court to establish a "constructive trust into which Apple's ill-gotten gains shall be disgorged and from which Plaintiff and members of the Class may obtain restitution."
Comments
Good luck with that.
John Pistacchio, you might have a better argument that Apple's Arcade pricing is Supercompetitive, ie, priced so low that no one else can compete.
He has a backer named Sim Tweeney who for some reason doesn’t want to be mentioned in the lawsuit.
This isn't what the game streamers want, but the alternative is to use a browser for game play.
Apple needs to get a case decided in court to determine if these claims have any substance or are just opportunistic claims on its success.
In my opinion it's their devices and their iOS and their store - no one has been forced to purchase an Apple device (plenty of choices, and heck aren't they meant to be these supper luxury items anyway that are only for all the ohh so elite of elite consumers. And nor have they forced coders to make iOS apps - once again they decided to do that). Surely Apple have the right to make and manage their devices the way they want to.
https://www.businessinsider.com/microsoft-xbox-game-pass-apple-iphone-ipad-2020-10
Apple has a monopoly in the thing created.
Apple has a monopoly on iPhones. No one else is allowed to crack open an iPhone, copy it and sell it, and call it an iPhone.
Apple Arcade is in competition with cloud services, on a platform they created and owned.
Apple is in competition with my Breville because eating toast is an alternative activity to checking your email.
Something needs to be done about Google's monopoly in search engines, even though there are other search engines, Google isn't stopping anyone from creating a search engine, and I don't use Google's search engine.
I'm afraid we're in an age where success is punishable by sanctions. You get too good at what you do, then you're competitors, who're not as good, should be cut a piece of the action.
Rewarding incompetence; it's what the people want obviously.
And they're not actually blocking anything. If Apple prevented Safari from running streaming games, then that would be a problem.
If you want to write a streaming service, then go through the browser.
User goes to the service, adds the service home page as an icon on their phone.
Job done.
This is stupid American thinking. I've read people say that Apple owes them money because they're "too rich" when they hit a 2T market cap.... yeah I've read comments like that. *shakes head*
Also, I don't get why the whole "Netflix for games" notion offends so many of you just because Apple decides not to allow it. Anyway this doesn't matter. Microsoft is going to implement this as a PWA just like Amazon did. The only question is whether Google and Nvidia are now going to, and whether PlayStation, Epic and Steam follow suit when their streaming services inevitably launch within the next 2 years.
Basically by doing this what Apple is doing is increasing and normalizing the adoption of PWAs. Which, of course, is what Google, Microsoft and Amazon have always advocated. Because PWAs will inevitably rely on Azure, AWS and Google Cloud Platform. And also because PWAs make you less dependent on getting third party developers to put an app in your store (Microsoft for Windows 10X and Windows on ARM devices) and it enables cheap devices that don't have enough local processing power to provide a good user experience running premium apps (as many as half the active Android devices including all the Amazon Kindle ones).
"Netflix for games" doesn't offend me. It's just disingenuous, since Netflix streams files (not required for review by App Store) and Xbox cloud gaming would be streaming applications (required for review by App Store).