Department of Justice Sues Apple Over Entire Business Model, Alleges “Monopoly”

Given that this is coming from the Justice Department, it’s very obvious that it’s just about pushing for more control over the company, demanding more censorship and spying and so on.

The issue of whether or not Apple is a “monopoly” is complicated by the fact that Google exists, meaning the phone market is a duopoly. A real lawsuit would have to make the argument that the two have collaborated to suppress competitors.

When Epic sued both Google and Apple over the app store charges, they did it as separate lawsuits and they won against Google while losing against Apple. So there is no basic logic here. The issue is complicated by the fact that these companies are international, and UK and EU authorities also end up having an impact on regulations.

But it would be ridiculous to suggest that the Biden government cares about consumer protection.


The U.S. Department of Justice and 15 states on Thursday sued Apple as the government cracks down on Big Tech, alleging the iPhone maker monopolized the smartphone market, hurt smaller rivals and drove up prices.

Apple joins competitors sued by regulators, including Alphabet’s Google, Meta Platforms and across the administrations of both former President Donald Trump and President Joe Biden.

“Consumers should not have to pay higher prices because companies violate the antitrust laws,” Attorney General Merrick Garland said in a statement. “If left unchallenged, Apple will only continue to strengthen its smartphone monopoly.”

The Justice Department said that Apple charges as much as $1,599 for an iPhone and makes larger profit than any others in the industry. Officials also said Apple charges various business partners – from software developers to credit card companies and even its rivals such as Google – behind the scenes in ways that ultimately raise prices for consumers and drive up Apple’s profit.

Dating back to its time as a marginal player in the personal computer market, Apple’s business model has long been based on charging users a premium for technology products where the company dictates nearly all of the details of how the device works and can be used. The Justice Department seeks to unwind that business model by forcing Apple, which has a market value of $2.7 trillion, to offer users more choices around how apps can tap in to the hardware that Apple designs.

Apple denied the allegations made by the government.

This lawsuit threatens who we are and the principles that set Apple products apart in fiercely competitive markets. If successful, it would hinder our ability to create the kind of technology people expect from Apple — where hardware, software, and services intersect.”

White House assistant press secretary Michael Kikukawa said: “President Biden strongly supports fair and robust enforcement of the antitrust laws.”

The Justice Department, which was also joined by the District of Columbia in the lawsuit, is seeking changes at Apple. An official suggested some form of breakup or reduction of the size of Apple was a possibility when they noted “structural relief is also a form of equitable relief.”

Apple has a lot of problems. Their phone sales are dropping (even though the 15 sold better than the 14, because people wanted the USB-C port), and maybe more importantly, they’ve made no significant investment in AI, while every other tech company is at least trying to do something.

Apple has long avoided innovation, canceling their planned car, which presumably would have sold very well. It was a really good company when Steve Jobs was alive, but after Rim Cook took over, the company has been on a clear downward trend, despite the bloating market cap.

This lawsuit will impact the stock more, presumably. Warren Buffett and various politicians with insider trade knowledge were already dumping the stock.

Elvis Dunderhoff contributed to this report.