Apple Hit With Landmark Antitrust Lawsuit By The DOJ

“Each step in Apple’s course of conduct built and reinforced the moat around its smartphone monopoly,” says the suit, filed by the DOJ and 16 attorneys general in New Jersey federal court.

The Justice Department said in a release that to keep consumers buying iPhones, Apple moved to block cross-platform messaging apps, limited third-party wallet and smartwatch compatibility and disrupted non-App Store programs and cloud-streaming services.

The challenge represents a significant risk to Apple’s walled-garden business model. The company says that complying with regulations costs the company money, could prevent it from introducing new products or services, and could hurt customer demand.

If the DOJ’s lawsuit is successful, it could force the Tim Cook-run company to make significant changes to its highly successful business model.In a press conference announcing the lawsuit, U.S. Attorney General Merrick Garland said, “As set out in our complaint, Apple has that power in the smartphone market. If left unchallenged. Apple will only continue to strengthen its smartphone monopoly.” Per The Verge, the DOJ’s lawsuit accuses Apple of:

• Disrupting “super apps” that encompass many different programs and could degrade “iOS stickiness” by making it easier for iPhone users to switch to competing devices
• Blocking cloud-streaming apps for things like video games that would lower the need for more expensive hardware
• Suppressing the quality of messaging between the iPhone and competing platforms like Android
• Limiting the functionality of third-party smartwatches with its iPhones and making it harder for Apple Watch users to switch from the iPhone due to compatibility issues
• Blocking third-party developers from creating competing digital wallets with tap-to-pay functionality for the iPhone

In a statement to CNBC, Apple did not agree with the lawsuit and said it would fight it. A spokesperson for the tech giant told CNBC, “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. It would also set a dangerous precedent, empowering government to take a heavy hand in designing people’s technology.” Android users have been eating this all up because of the claims they have accused Apple of for years. You can see more reactions in the gallery below.