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## The U.S. Government’s Antitrust Lawsuit Against Apple: A Comparison with Microsoft

By Mike Scarcella

(Reuters) – The U.S. government’s antitrust lawsuit against Apple draws on the watershed 1998 case that broke Microsoft’s stranglehold on desktop software, but that may prove to be an imperfect blueprint for addressing smartphone competition.

The market for the iPhone today looks very different from the near-monopoly enjoyed by Microsoft’s Windows operating system two decades ago, and the government as a result may face a tougher time in taking on Apple, legal experts said.

### Challenges in Addressing Smartphone Competition

The Department of Justice, along with 15 state governments, accused Apple of unlawfully monopolizing the smartphone market through restrictions on app developers that curb choice and innovation, which it said forces consumers to pay higher prices. Apple said the government is wrong on the facts and law.

The government has to prove that AppleÔÇÖs business practices were ÔÇ£exclusionaryÔÇØ and harmed consumers by degrading the quality of rival products, according to several legal experts.

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### Allegations of Monopolistic Behavior

The government accused Apple of suppressing technologies that would have increased competition among smartphones in five areas: so-called “super apps,” cloud streamed gaming apps, messaging apps, smartwatches, and digital wallets.

Antitrust enforcers said Apple was rapidly expanding its influence and power in industries including content creation and financial services.

### A Comparison with Microsoft’s Case

By comparison, Microsoft was accused of abusing its market dominance to impede users from freely installing software on computers using the companyÔÇÖs operating system. That might sound similar to Apple’s control over the app store, but legal experts said there are important differences.

Apple can contract with whom it wants and design products as it sees fit, legal experts said. It becomes a problem when a company with monopoly power takes steps to lessen short-term profit in order to keep rivals out in the longer term.

### Market Share Insights

Microsoft was forced to open its operating system because it controlled 95% of desktop operating systems in the 1990s. By comparison, Apple had 55% of the North American market for smartphones at the end of September based on shipments. The Justice Department seeks to define the market as that of smartphones in the United States.

Apple and rival Samsung Electronics each had about a 20% market share globally in 2023, though Apple beat Samsung slightly on shipments. Ross predicted it would be harder for the Justice Department to prevail against Apple than it was in the Microsoft case.

### Conclusion

Some of these allegations have been touched upon before in court. legal experts said that reflects the viewpoint within the DOJ and the Biden Administration’s Federal Trade Commission about challenging cases.

Litigator Melissa Maxman in Washington said the Microsoft case changed the tech landscape and lauded the government’s lawsuit as a step toward greater competition in the smartphone market.

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