A Judge Blocked Apple from Collecting These Commissions
Brian Albrecht, Chief Economist at ICLE, is quoted in Reason article on the Apple v. Epic verdict and how it could force Apple to make major changes to iOS, used by millions of Americans. Read the full story here.
Brian Albrecht, chief economist at the International Center for Law and Economics, tells Reason that Apple’s in-app fees can be justified by platform investment incentives and security concerns, which shield Apple from liability under federal antitrust laws.
Judge Rogers said herself in 2021 that exclusive distribution via the App Store and commissions on in-app purchases “have procompetitive effects that offset their anticompetitive effects” and, for this reason, dismissed Epic’s Sherman and Cartwright claims. Rogers also found that “Apple does not have substantial market power equating to monopoly power.” However, California’s Unfair Competition Law “condemns any business practice that is ‘unfair’ to consumers or competitors, even if it doesn’t rise to the level of monopolistic conduct,” explains Albrecht. Rogers ruled that Apple’s antisteering provisions were unfair on the basis that they produced “anticompetitive effects and excessive operating margins under any normative measure.”
Albrecht explains that the ruling will increase competition payments, which will help consumers, but reduce Apple’s investments in the App Store, which will harm them. “It’s hard to see how completely ripping [the system] apart will be helpful to consumers,” says Albrecht.