DoJ Claims Apple Implemented In-App Purchase Rules to 'Retaliate Against Amazon'

iBooks.pngThe Department of Justice today filed a revised punishment proposal for Apple in its ongoing e-book dispute with the company, reports GigaOM.

While the new proposal is largely the same as the original, it includes an expanded section on Apple's in-app purchasing policies along with the accusation that Apple initiated the rules specifically to "retaliate against Amazon for competitive conduct that Apple disapproved of" and to "make it more difficult for consumers using Apple devices to compare ebook prices among different retailers."

When Apple debuted App Store subscriptions back in 2011, it instituted a rule that prevented developers offering subscription and purchased content from including direct links to stores that would bypass the in-app purchase system. As a result, e-book retailers like Amazon and other digital media providers were forced to remove links to outside content.

Though Apple has argued that its App Store policies are unrelated to the e-books case, the Department of Justice disagrees and maintains that Apple should be forced to re-allow links to outside bookstores within apps. As part of its own argument, the DoJ points out that Apple does not receive a 30 percent cut for all goods sold through its App Store and likens digital e-books to physical goods.

During the August 9 conference, Apple's counsel argued that the provision should not be adopted because it was “absurd” to suggest that Apple had changed its apps policy to discriminate against e-book retailers.

These statements are incorrect. Apple misrepresented the factual circumstances surrounding this matter, including how the App Store operated and operates. It simply is not true that Apple receives a 30 percent commission from all retailers for all goods sold through apps. To use Apple's counsel's own examples, one can buy shoes today on an iPad using a Zappos app.

As evidence that Apple was conspiring to raise prices to punish Amazon, the Department of Justice submitted an email from Steve Jobs to Phil Schiller and Eddy Cue, which specifically mentions an Amazon Kindle commercial and suggests Apple force books, newspapers, and magazines to use Apple's "far superior payment system."

sjobsemailAlong with the new evidence, the DoJ continues to insist that e-book retailers should be allowed “costless hyperlinks” in their App Store apps for a two-year period.

Effectuating the provision requires Apple to make no change whatsoever to its iBookstore or App Store. However, returning to the pre-conspiracy policy will result in greater price transparency, and keep Apple from continuing to reap profits from its collusive behavior.

The revised proposal also cuts the proposed injunction time against Apple in half, but continues to require the nullification of existing agency model deals and the implementation of a third party monitor to ensure Apple's continued adherence to internal antitrust compliance policies.

According to Bloomberg, Apple has objected to the revised government proposal, saying that an outside compliance monitor isn’t necessary.

Top Rated Comments

Brandon263 Avatar
134 months ago
Kinda agree with the DOJ on this one. Why can't Apple just compete with Amazon based on prices? It's not like they don't have the money.
Score: 39 Votes (Like | Disagree)
piecloud Avatar
134 months ago
Seems if you purchase something to use on/within the iOS device, Apple takes a cut, but if it is something not related to an iOS device, Apple does not take a cut.

What if MS wants to take a cut of every iTunes purchase on Windows?
Score: 19 Votes (Like | Disagree)
Yojimbo007 Avatar
134 months ago
It is becoming overly obviouse that this lunatic judge is in bed with Amazon !
Score: 15 Votes (Like | Disagree)
Oletros Avatar
134 months ago
It is becoming overly obviouse that this lunatic judge is in bed with Amazon !

It is becoming overly obvious that you don't have read the article
Score: 13 Votes (Like | Disagree)
Designer Dale Avatar
134 months ago
Can you get Apple iBooks from Amazon? How about Google apps? All these companies restrict their content to their devices, but everyone seems to want a ride on the Apple ecosystem.

Let's see the DOJ try to force Ford dealers to sell Chevy products. And I'm not talking about the used car lot.

Dale
Score: 13 Votes (Like | Disagree)
bryanescuela Avatar
134 months ago
Re:

Shame on u Steve!
Score: 12 Votes (Like | Disagree)

Popular Stories

apple card 1

Apple Ending Apple Card Partnership With Goldman Sachs

Tuesday November 28, 2023 3:09 pm PST by
Apple is ending its credit card partnership with Goldman Sachs, according to The Wall Street Journal. Apple plans to stop working with Goldman Sachs in the next 12 to 15 months, and it is not yet clear if Apple has established a new partnership for the Apple Card. Apple and Goldman Sachs will dissolve their entire consumer partnership, including the Apple Card and the Apple Savings account....
iOS 17

Everything New in iOS 17.2 Beta 4

Tuesday November 28, 2023 12:18 pm PST by
Apple is wrapping up development on iOS 17.2, with the update expected to come out in December. While we're getting to the end of the beta testing period, Apple is still tweaking features and adding new functionality. We've rounded up everything new in the fourth beta of iOS 17.2. Default Notification Sound Under Sounds & Haptics, there's a new "Default Alerts" section that allows you to ...
ios 17 namedrop

Police Departments and News Sites Spreading Misinformation About How iOS 17 NameDrop Feature Works

Monday November 27, 2023 5:11 pm PST by
Apple with iOS 17.1 and watchOS 10.1 introduced a new NameDrop feature that is designed to allow users to place Apple devices near one another to quickly exchange contact information. Sharing contact information is done with explicit user permission, but some news organizations and police departments have been spreading misinformation about how NameDrop functions. As noted by The Washington...
All New CarPlay Five New Features Article 2

What to Expect From All-New CarPlay, Still Listed as Coming 'Late 2023'

Tuesday November 28, 2023 7:44 am PST by
At WWDC in June 2022, Apple previewed the next generation of CarPlay, promising deeper integration with vehicle functions like A/C and FM radio, support for multiple displays across the dashboard, increased personalization, and more. Apple's website still says the first vehicles with support for the next-generation CarPlay experience will be announced in "late 2023," but it has not shared...
iOS 17

iOS 17.1.2 Update for iPhone Likely to Be Released This Week

Monday November 27, 2023 8:24 am PST by
Apple will likely release iOS 17.1.2 this week, based on mounting evidence of the software in our website's analytics logs in recent days. As a minor update, iOS 17.1.2 should be focused on bug fixes, but it's unclear exactly which issues might be addressed. Some users have continued to experience Wi-Fi issues on iOS 17.1.1, so perhaps iOS 17.1.2 will include the same fix for Wi-Fi...
Apple 5G Modem Feature Triad

Apple to Discontinue Custom 5G Modem Development, Claim Reports

Wednesday November 29, 2023 4:19 am PST by
Apple is discontinuing in-house modem development after several unsuccessful attempts to perfect its own custom 5G modem chip, according to unconfirmed reports coming out of Asia. According to the operator of news aggregator account "yeux1122" on the Naver blog, supply chain sources related to Apple's 5G modem departments claim that the company's attempts to develop its own modem have...
Apple Logo

Apple Discontinued These 5 Products This Year

Monday November 27, 2023 7:03 am PST by
As the end of 2023 nears, now is a good opportunity to look back at some of the devices and accessories that Apple discontinued throughout the year. Apple products discontinued in 2023 include the iPhone 13 mini, 13-inch MacBook Pro, MagSafe Battery Pack, MagSafe Duo Charger, and leather accessories. Also check out our lists of Apple products discontinued in 2022 and 2021. iPhone Mini ...
Google Drive

Some Google Drive Users' Files Have Mysteriously Vanished

Tuesday November 28, 2023 3:55 am PST by
Google Drive users have been warned not to disconnect their account within the Google Drive for desktop app, after a spate of reports of files going missing from the cloud service. Alarm bells began ringing last week on Google's community support site when some users reported files mysteriously disappearing from Google Drive, with some posters claiming six or more months of data had...