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Home High-tech

Apple in the crosshairs of the EU

3 weeks ago
in High-tech
Apple announces that it will stop selling its products in Russia
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The European Commission (EC) announced on Monday that it has informed the American giant Apple that it believes that the company is abusing its dominant position in the markets for mobile wallets on iOS devices.

By limiting access to standard technology for making in-store contactless payments through mobile devices “Near Field Communication (NFC)” or “tap and go”, Apple is restricting competition in the market for mobile wallets on iOS, explains the EU executive.

The Commission is challenging Apple’s decision to block mobile wallet app developers from accessing necessary hardware and software (‘NFC input’) on its devices, in favor of its proprietary solution, Apple Pay.

“We have evidence that Apple has restricted third-party access to key technology needed to develop competing mobile wallet solutions on Apple devices,” said Margrethe Vestager, executive vice president responsible for competition policy, noting that for the purposes of the integration of European payments markets, it is essential that consumers benefit from a competitive and innovative payments landscape.

Apple Pay is Apple’s proprietary mobile wallet solution, offered on iPhones and iPads. It enables mobile payments in physical and online stores. Apple’s iPhones, iPads and software form a “closed ecosystem”, in which Apple controls every aspect of the user experience, including mobile wallet developers’ access to said ecosystem.

The EC considers on a preliminary basis that Apple has significant power in the market for smart mobile devices and a dominant position in the markets for mobile wallets.

Most notably, Apple Pay is the only mobile wallet solution to have access to the necessary NFC input on iOS. Apple does not make it available to developers of third-party mobile wallet applications. NFC ”tap and go” technology is integrated into Apple’s mobile devices for in-store payments. This technology allows communication between a mobile phone and payment terminals in stores. NFC technology is standardized, available in almost all in-store payment terminals and guarantees maximum security and fluidity for mobile payments. Compared to other solutions, NFC technology offers a smoother and more secure payment experience, and enjoys wider acceptance in Europe.

The Commission finds on a preliminary basis that Apple’s dominant position in the market for mobile wallets on its iOS operating system restricts competition, by restricting access to NFC technology to Apple Pay.

Such a situation produces, according to her, crowding out effects for its competitors, weakens innovation and restricts consumer choice when it comes to mobile wallets on iPhones. If confirmed, this behavior would be contrary to Article 102 of the Treaty on the Functioning of the European Union, which prohibits the abuse of a dominant market position.

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Tags: AppleEU
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