Apple faces £3 billion legal claim over alleged competition law breaches

Around 40 million Apple customers in the U.K. could be entitled to an average payout of £70 if a major new legal challenge is successful.

The consumer publication Which? has announced what it describes as a landmark legal claim against the company for alleged breaches of competition law. It contends that users have been unfairly locked into “rip-off” iCloud prices by anticompetitive behavior, and is launching an action worth £3 billion (around $3.8 billion) to obtain compensation.

“Which? believes taking this action is essential to changing the behavior of huge companies like Apple that use their market dominance to engage in anti-competitive practices that reduce choice and drive up prices for consumers,” the publication said in a press release.

The central claim is that Apple’s iOS ecosystem is monopolistic and that the company uses its power over the platform to give preferential treatment to iCloud, its cloud storage service.

“A key tactic to achieve this,” says Which?, “has been encouraging users to sign up to iCloud for storage of photos, videos, and other data while simultaneously making it difficult to use alternative providers, including because Apple does not allow customers to store or back up all of their phone’s data with a third-party provider.”

This directs revenue into Apple’s own coffers, at the expense of rival offerings. This in turn enables Apple to charge what the publication believes are above-market-rate prices: Which? claims consumers are overcharged by an increasing amount each year, up to £13.36 in 2024. Over many years these additional costs add up, and Which? believes the average consumer will be owed £70 in damage, although this will vary depending on how long they have been paying for iCloud.

This isn’t the first time Apple has been accused of monopolistic behavior; indeed the company has been fighting off such claims for years. (Unsurprisingly, Apple’s official position is that it isn’t a monopoly.) Earlier this year, the company was sued by the U.S. Justice Department for its alleged iPhone monopoly. Similar investigations have been conducted in the U.K. and the EU.

If you’re a U.K. consumer who has paid for iCloud at any point since October 1, 2015, you may be entitled to compensation. Visit www.cloudclaim.co.uk for more information about the action and to register to receive updates on its progress.