For decades, Apple’s ecosystem play has been both coveted and despised by the consumer electronics industry. However, a recent lawsuit from the U.S. Department of Justice, alongside 16 states and the District of Columbia, has shed light on alleged antitrust violations by the tech giant.
“The suit focuses on the iPhone and controversial practices, such as Apple’s exclusive approach to app sales, as well as the Apple Watch,” states the filing.
The complaint addresses a long-standing issue among Android users, who have been unable to reap the benefits of the market-leading Apple Watch due to its compatibility only with the iPhone.
“If a user purchases an Apple Watch, it becomes more difficult and costly for them to switch to an Android smartphone as they would have to abandon their expensive Apple Watch and invest in a compatible smartwatch,” the filing continues.
“Cross-platform smartwatches have the potential to lessen iPhone users’ reliance on Apple’s proprietary hardware and software,” notes the document.
Apple’s notorious “just works” ethos heavily relies on enticing users to stick with their products across various product lines. This tactic is not unique to Apple, as other companies have also limited certain features to first-party hardware. However, the majority of non-Apple smartphones run on the same operating system, allowing for cross-manufacturer compatibility.
The complaint also references an internal message from an Apple VP of Product Marketing, which acknowledges that the limited compatibility of the Apple Watch may discourage iPhone users from switching to other devices.
The lawsuit primarily addresses the impact of the Apple Watch on iPhone sales, but also accuses the company of restricting third-party access to new and improved APIs for smartwatch functionality.
Compared to the iPhone, the Apple Watch has a higher market share in its category on a global scale. If the DOJ’s lawsuit succeeds in opening up the Apple Watch to third-party compatibility, it could not only decrease iPhone sales but also attract Android users and potentially boost overall watch sales.
Additionally, the filing takes a subtle jab at the origins of the Apple Watch, stating that the company “borrowed the idea of a smartwatch from third-party developers.” This may be a nod to early smartwatch companies like Pebble.
