India’s antitrust watchdog on Friday ordered an investigation into Apple’s business practices – in particular, the company forcing iPhone app developers to use a proprietary payment system – in India, where the US company has fewer than 2% of the smartphone market.
India’s Competition Commission, which ordered the chief executive to investigate within 60 days, said it is prima facie of the opinion that the mandatory use of Apple’s integrated payment system for paid apps and in-app purchases “restrict[s] the choice offered to application developers to select a payment processing system of their choice, especially when it charges a commission of up to 30% for both application and in-app purchases. “
The watchdog began investigating the case after a complaint filed by Together We Fight Society, a non-profit organization based in the western Indian state of Rajasthan. The organization said that Apple’s move, which prevents app developers from using a third-party or their own payment system, significantly reduces the revenue they generate.
Apple had urged the ICC to close the case, believing that it was too small a player in India.
India is the latest country to voice concerns over Apple and Google demanding that app developers use the company’s payment system for in-app purchases. (The Indian watchdog opened the investigation into Google’s business practices last year.) Earlier this year, South Korea approved a measure that bars Apple and Google from paying a commission by forcing developers to use their proprietary payment systems.
In the United States, games company Fortnite Epic has publicly challenged Google and Apple by introducing its own payment system in the dormant hit title. Now he’s locked in legal battles with Google and Apple. This year, attorneys general in 36 U.S. states filed an antitrust complaint against Google, alleging that its Google Play app store is an illegal monopoly. A bipartisan bill introduced this year in the US Senate seeks to restrict the operation of the Apple and Google app stores and the rules that can be imposed on app developers.
Last year, the European Union proposed the Digital Markets Act, which aims to prevent tech platforms from abusing their gatekeeper position.
âAt this stage, it appears that the absence of competitive constraints in the distribution of mobile applications is likely to affect the conditions under which Apple provides[s] access to its App Store for application developers, including commission rates and conditions that prevent some application developers from using other integrated payment systems, âITC wrote on Friday in an order to 20 pages.
The ICC said it’s also worth checking whether Apple is using the data it collects from competitors’ users to “improve its own services.”
Despite a huge increase in iPhone sales in India in recent years, Apple is still a small player in the market. Google’s Android has a market share that fluctuates between 98% and 99% each year.
We’ve reached out to Apple for comment.