In antitrust suit, feds look to further stifle business

Success breeds contempt, according to an old adage, and the same can be said of the government’s view of successful businesses.

Time and again, bureaucrats look for ways to punish them. They do so to such a degree that I am beginning to think whenever bureaucrats see a thriving company, they say, “Nope. No way. Not on my watch.”

One of the government’s favorite weapons to wield against companies are antitrust lawsuits. By filing them, government officials accuse businesses that have grown large—thanks to popular products and services—of being anti-competitive. The government’s hope is to then either break up the companies or fundamentally alter their business models.

The feds have used this approach with plenty of companies, including against technology giants Microsoft, Amazon, Facebook and Google. On March 21, they chose a new victim of their witch hunt: Apple. The federal government—joined by 16 state attorneys general—filed an antitrust suit against the tech company. Like many suits that preceded it, it is ridiculous.

“We allege that Apple has maintained monopoly power in the smartphone market, not simply by staying ahead of the competition on the merits, but by violating federal antitrust law,” United States Attorney General Merrick Garland said in a press release. The case against Apple appears to be two-fold. The Department of Justice claims that Apple has monopoly power, and perpetuates and grows that monopoly power through anti-competitive means—namely limiting which applications can operate on iPhones and whether they can transfer to non-Apple devices.

There are a few issues to parse through here. First, does Apple truly have an illegal monopoly on the smartphone market? I don’t believe so. I Googled “monopoly” on my Android device—Apple’s primary competitor—and it defined monopoly as, “the exclusive possession or control of the supply of or trade in a commodity or service.” Of course, that’s the layman’s definition, not the legal definition, which is amorphous—leading to questionable lawsuits.

This aside, Apple doesn’t control the smartphone market any more than Google controls the internet. It has to compete with a host of search engines and email providers. Likewise, Apple has to contend with viable competitors, like the aforementioned Android devices. It is true that Apple holds a large market share—sitting at around 61 percent in the United States vs. 39 percent for Android—but this is proof that no company entirely dominates the market. Rather this simply highlights two different, successful business models and that consumers still have choices. These are not the hallmarks of a monopoly.

The Justice Department’s other complaints are a little more complex. Their attorneys assert that Apple “violated antitrust laws with practices that were intended to keep customers reliant on their iPhones and less likely to switch to a competing device,” reads The New York Times. “The tech giant prevented other companies from offering applications that compete with Apple products like its digital wallet, which could diminish the value of the iPhone.”

So the crux of the suit revolves around Apple attempting to retain customers and limiting access to competitors’ applications. I am no businessman, but it seems unreasonable to criticize a company for attempting to retain customers. That’s how anything from small shops to large corporations stay in business, but does Apple purposefully limit which applications can be used on their devices to build a vertically integrated system to maintain customers? That’s for the courts to decide, but there could be more to it than this.

According to Apple’s website, its business model includes a focus on security and applications that are intended to work seamlessly on their devices. Applications that might not integrate with Apple’s iOS software or could pose cybersecurity risks to their customers are forbidden from being installed. Apple also promotes its own applications—some of which obviously don’t work on other operating systems. Why should they?

Again, this is Apple’s business model, which is apparently quite popular, and if consumers don’t care for it, they are free to vote with their feet and switch their loyalties. Many have opted to take their business elsewhere too. As of 2022, around 133.4 million Americans, including yours truly, were Android smartphone users, according to Statista. That hardly sounds like Apple enjoys a monopoly.

Apple plans to fight the suit, and understandably. This seems like the latest government salvo against successful private enterprise, and given the government’s anti-business ethos, it won’t be the last.