A £785 million ($1 billion) class action lawsuit was filed against tech giant Apple in the UK by 1,500 app developers on Tuesday, over its App Store fees.
The developers are claiming that Apple’s 30% charge on its in-app sales discourages competition in the suit, which was filed with the Competition Appeal Tribunal.
Sean Ennis, a former economist at the OECD and professor at the University of East Anglia, filed the lawsuit for the developers. He said, “Apple’s charges to app developers are excessive, and only possible due to its monopoly on the distribution of apps onto iPhones and iPads.”
Ennis added, “The charges are unfair in their own right, and constitute abusive pricing. They harm app developers and also app buyers.”
Apple has rejected the claims, saying that its App Store fees facilitate the high-quality user experience of its store and are reasonable. It has also noted it has abided by all relevant laws.
To use Apple’s in-app payment system, the company charges a commission of 15% to 30% of an app’s sale price. In recent years, the company’s service business has generated revenue growth of roughly $20 billion per quarter.
Regardless, antitrust regulators in several nations have opened investigations into the company’s practices. In 2021, the company had a €13 billion fine ($14.9 billion), with interest, levied against it by the European Commission for anti-competitive practices within the App Store. The company is also being sued by the US Department of Justice which alleges the company has exploited its dominance over the smartphone market unfairly.