Apple Won’t Let Its App Store Monopoly Go Down Without A Fight (Even If It Costs Them Billions) – The Average Joe
Business Economy Tech Subscribe About Us

    Apple Won’t Let Its App Store Monopoly Go Down Without A Fight (Even If It Costs Them Billions)

    Noah Weidner

    March 8, 2024

    Apple ($AAPL) has fallen far from the tree that gave it life. The company has been tangled in a long battle with Fortnite creator Epic Games, who sued the tech giant in 2020 — charging that Apple’s 30% commission on app sales was anti-competitive.

    The US Supreme Court decided not to hear appeals from Epic Games and Apple regarding their dispute. Meanwhile, the European Union (EU) passed the Digital Markets Act (DMA) — forcing Apple to allow third-party app stores. And that’s where things get heated.

    Apple goes dark mode: Epic Games had plans to launch one of the first third-party iOS stores, circumventing Apple’s fees. However, right before the EU’s new DMA rules came into force this week, Apple terminated Epic Games’ developer account, saying it represents a “threat” to its ecosystem. Epic alleged that the ban was retaliatory and represented a “serious violation of the DMA” — prompting an investigation by EU regulators.

    • According to Bloomberg, potential fines for breaching the DMA could reach up to 10% of a company’s global revenue — doubling for repeat offenders.
    • As part of compliance, Apple unveiled plans to make switching from iPhone to Android products easier.

    While Apple’s stock is shining red

    Investors have heard no shortage of negative Apple news in recent weeks. iPhone sales have slowed dramatically in key markets like China, top talent has departed, and the US Department of Justice is expected to file an antitrust lawsuit this month. But two missteps stood apart for their significance (and cost):

    • Apple scrapped its Apple Car project, a decade-long effort to build an electric vehicle — costing over $10B.
    • The company has also experienced a slow launch with its mixed reality Apple Vision Pro headset, its first new product since the Apple Watch in 2015.

    Buffett of bad news: $AAPL is down 8% year-to-date, but Mizuho analyst Jordan Klein warns that things could worsen if Warren Buffett, the company’s largest non-ETF shareholder, decides to sell more of his $AAPL holdings. Apple hasn’t been this oversold in years, and Klein thinks Buffett could sell billions in stock as Apple continues to underperform. Now, how much further will Apple roll from the tree?

    Trending Posts