The order from the CCI comes after a non-profit group alleged this year that Apple was abusing its dominant position in the apps market by forcing developers to use its proprietary in-app purchase system
New Delhi:
The Competition Commission of India (CCI) on Friday ordered a detailed probe against technology major Apple for alleged unfair business practices with respect to its App Store.
In a 20-page order, the watchdog said that Apple’s App Store is the only channel for app developers to distribute their apps to iOS consumers which is pre-installed on every iPhone and iPad.
The order from the CCI comes after a non-profit group alleged this year that Apple was abusing its dominant position in the apps market by forcing developers to use its proprietary in-app purchase system.
The complainant, “Together We Fight Society”, argued that Apple’s imposition of a 30% in-app fee for distribution of paid digital content and other restrictions hurts competition by raising costs for app developers and customers, while also acting as a barrier to market entry.
“Further, third party app stores are not allowed to be listed on Apple’s App Store as the developer guidelines as well as agreement prohibits app developers from offering such services… these restrictions imposed by Apple forecloses the market for app stores for iOS for potential app distributors,” the order said.
According to the CCI, this prima facie results in denial of market access for the potential app distributors/app store developers in violation of competition norms.
Further, such practices prima facie results in limiting/restricting the technical or scientific development of the services related to app store for iOS, due to reduced pressure on Apple to continuously innovate and improve its own app store, which is also in violation of competition rules, the order said.
Citing these factors, the regulator has ordered a detailed probe by its Director General (DG).
Apple did not respond to Reuters’ requests for comment.
The company denied the allegations in a filing to the CCI last month, seen by Reuters, and asked the regulator to throw out the case, stressing that its market share in India was an “insignificant” 0-5%.
CCI however said in the order that Apple’s argument on its market share was “completely misdirected” as the allegations were about anti-competitive restrictions on app developers and not end-users.
The allegations are similar to a case Apple faces in the European Union, where regulators last year started an investigation into the US tech giant.
The CCI ordered its investigations unit to complete the investigation and submit a report within 60 days of the order. Typically such investigations go on for several months.
The watchdog is separately conducting an investigation into Google’s in-app payment system as part of a broader probe into the company after Indian startups last year voiced concern.
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