On March 21 local time, Apple opened low and closed down 4.09% at $171.37, marking the largest daily decline since August 4, 2023. Its market value evaporated overnight by over $110 billion (approximately RMB 800 billion), and its latest market value was $2.6 trillion.
According to CCTV News, on March 21st local time, US Attorney General Merrick Garland stated at a press conference that the US Department of Justice and Attorney General of more than a dozen states have filed antitrust lawsuits against Apple, accusing the company of monopolizing the mobile phone market using its control over Apple's hardware and software, harming the interests of consumers, developers, and competitor companies.
It is reported that the lawsuit filed by the US Department of Justice and 16 Attorney General in a federal court in New Jersey states that Apple's anti competitive behavior goes beyond the normal business scope of its phones and watches.
Galan stated that the Supreme Court defines monopolistic behavior as "the act of controlling prices or excluding competition.". Officials from the Ministry of Justice also stated that it is not ruled out to use the measure of splitting the company to resolve this antitrust lawsuit.
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In addition, according to a report by Caixin, the US Department of Justice stated in a press release that "Apple's widespread exclusionary behavior makes it difficult for Americans to replace smartphones, disrupting innovation in applications, products, and services, and bringing extraordinary costs to developers, businesses, and consumers."
The Ministry of Justice and the Attorney General believe that Apple's anti-competitive behavior has transcended the hardware scope of the iPhone and Apple Watch, extending to advertising, browsers, FaceTime, and news products, including:
Prevent innovative super applications, suppress mobile cloud streaming services, exclude cross platform messaging applications, reduce the functionality of non Apple smartwatches, and restrict third-party digital wallets.
The lawsuit also mentions a case in which in 2022, Apple CEO Tim Cook was asked by a live audience that an iPhone could not send videos to his mother's Android phone. Cook responded, "Then buy an iPhone for your mother.".
The lawsuit claims that Apple has established and reinforced a moat around its smartphone monopoly at every step. By utilizing its monopoly power, Apple extracts more money from consumers, developers, content creators, artists, publishers, small businesses, and retailers, driving the company's "astronomical valuation" at this cost.
Merrick Garland stated in a press release, "If Apple is not challenged, the company will only continue to strengthen its monopoly on smartphones. The Department of Justice will vigorously enforce antitrust laws to protect consumers from the impact of higher prices and fewer choices."
The press release also stated that Apple's revenue for the fiscal year 2023 was $383 billion, with a net profit of $97 billion, surpassing any other company in the Fortune 500 and the GDP of over 100 countries. At the press conference, Galan emphasized that this success is not due to excellent products, but rather the result of its "exclusivity" strategy.
Apple stated that complying with regulatory regulations would cost a significant amount of money, may prevent it from launching new products or services, and may harm customer needs.
Apple statement stated that both in fact and in law, this lawsuit is untenable. Apple innovates day after day, creating technologies that people love, designing products that can seamlessly collaborate, protecting people's privacy and security, and creating a better experience for users. Apple believes that this case threatens its foundation and the principle of allowing its products to stand out in fierce competition. It warns that it will "set a dangerous precedent for the government to exert heavy pressure on technology involving the public," and promises to "vigorously defend itself.".
It is worth noting that according to Interface News citing foreign media on March 21, Apple and Alphabet's Google will face a comprehensive investigation by the European Union into whether they have complied with a new law that restricts the power of large technology companies, paving the way for possible huge fines. According to insiders, the European Commission is preparing to announce an investigation into the compliance of these companies with the EU Digital Markets Act in the coming days.
On March 4th local time, the Executive Vice President and Competition Commissioner of the European Commission, Vestager, stated on social media that the EU imposed a fine of 1.84 billion euros on Apple on the same day, citing its monopolistic behavior in the streaming music business.
Vestager said that for the past decade, Apple has "abused" the advantage of the Apple Store in the release of streaming music software, preventing streaming music software vendors from informing consumers that "there are cheaper paid music services outside of the Apple ecosystem," thereby violating EU antitrust regulations.
When streaming music software providers provide services through the Apple Store, they need to pay a 30% commission to Apple, and cannot explain to consumers on Apple devices that the commission is included in the total price, cannot provide links to cheaper options, or even inform consumers via email that there are other cheaper options available.
The European Commission believes that Apple's approach may have resulted in many users of the Apple operating system paying "much higher" fees for streaming music services, as streaming music software providers need to pay "high commissions to Apple and pass them on to consumers.".
Vestag said that in the future, Apple must allow streaming music software providers to "freely communicate" with users in the Apple operating system.
Apple is dissatisfied with this penalty decision and has stated that it will appeal. Apple stated that the European Commission "has not found reliable evidence of consumer victimization, ignoring the reality of a thriving market full of competition and rapid development.".