How Apple’s war on super apps became the focus of its antitrust battle

Apple is facing a monumental antitrust lawsuit from the Justice Department, and much of the agency’s arguments revolve around Apple’s alleged efforts to suppress cloud gaming services and so-called “super” apps. The DOJ alleges that Apple has suppressed the development of both types of services to maintain its monopoly in the mobile market.

As cloud streaming services started to become more popular in 2020, Apple introduced new rules that seemed designed to give services like Xbox Cloud Gaming, Facebook Gaming, and GeForce Now a place in the App Store. But in reality the opposite happened. The rules severely limited the presence of cloud gaming services in the App Store, as Apple required developers to individually submit their games to the App Store for approval – rather than allowing them to exist in a single hub of games.

This led to cloud streaming services bringing their gaming hubs to web browsers on the iPhone, making them much less easy for users to find and access. Apple only recently reversed this rule by allowing cloud streaming services to submit a single app “with the ability to stream all games offered in their catalog.” Despite this, the DOJ claims that Apple has “used its power over app distribution to effectively prevent” developers from offering cloud streaming services on the iPhone, adding that “even today, none are available on the iPhone.”

Apple didn’t want cloud streaming on the iPhone in the first place, the DOJ claims. Because cloud streaming services allow users to play games hosted on a remote server, it eliminates the need for powerful hardware to run demanding games. In other words, users could buy a cheaper Android device or even an older, used iPhone to play streaming games on mobile instead of spending $799 for a brand new iPhone 15.

“For years, Apple blocked cloud gaming apps that would have given users access to desired apps and content without having to pay for expensive Apple hardware because doing so would threaten its monopoly power,” the lawsuit reads. “Apple feared a world where ‘all that matters is who has the cheapest hardware’ and consumers could ‘buy the cheapest hardware.'[] a [expletive] Android for 25 bux at a garage sale and… got a solid cloud computing device ‘that’ works fine.’

In addition, the DOJ is also going after Apple’s restrictions on super apps, which provide access to a range of different services from a single application and are particularly popular in Asia. For example, WeChat, which is huge in China, functions as a messaging, payment, and short video sharing service. It also lets users install “mini” programs that exist within WeChat.

This arrangement is convenient for users And developers, the DOJ argues, because users don’t have to download a bunch of separate apps to access different capabilities. Meanwhile, developers also don’t have to push separate app updates for Android and iOS, because these programs run in an app rather than on the phone itself.

However, the DOJ’s lawsuit claims that Apple does not want US users or businesses to benefit from super apps. It notes that during a board presentation, Apple cited super apps as a “major headwind” for boosting iPhone sales in countries where they are popular because of “[l]ow stickiness” and “[l]low switching costs.” If someone benefits from using a super app, he or she doesn’t necessarily have to be tied to one ecosystem like Apple’s.

“If super apps became ‘the main gateway’… ‘the barbarians would be let in through the gate.’”

The iPhone maker views super apps as “fundamentally disruptive” to “existing app distribution and development paradigms” and ultimately Apple’s monopoly power,” the lawsuit said. That’s why developers are discouraged from putting them on the App Store, by requiring super apps to display mini-programs in a “flat text-only list” rather than as individual icons or tiles. The company also doesn’t allow super apps to categorize mini-programs in their apps, which prevents them from showing recently played games or a list of titles from the same developer.

“Apple recognizes that mini-application super apps would threaten its monopoly,” the lawsuit says. “As one Apple executive put it, super apps could become ‘the main gateway for people to play games, book a car, make payments, etc.’ would ‘let the barbarians in through the gate.’”

Although the lawsuit notes that Apple blocks mini-apps from using the API they need to use Apple’s in-app purchasing system, the company said it would ban mini-apps and games from its system in January to use. It’s unclear whether the change addresses the formatting arguments the DOJ is making in its lawsuits, as the App Store guidelines only mention that mini-apps must adhere to privacy rules, among other unrelated requirements.

Apple denies the claims outlined in the lawsuit, as company spokesman Fred Sainz says it “threatens who we are and the principles that differentiate Apple products in fiercely competitive markets.” At the same time, Apple is also contending with new antitrust rules in the European Union, which have forced the tech giant to open iOS to third-party marketplaces, sideloading and new default settings. But some prominent developers argue that Apple’s changes are still not enough.

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