Apple fined $1.23B in France on antitrust charges

Brief:

Apple was hit with a record €1.1 billion ($1.23 billion) antirust fine from France's competition authority, which accused the iPhone maker of masterminding a distribution cartel with wholesalers. The investigation found that Apple and two wholesalers agreed not to compete and prevented distributors from lowering prices on its products, per an announcement.
France also slapped a €76.1 million fine on Tech Data and €63 million on Ingram Micro, claiming that the electronics wholesalers participated in Apple's alleged arrangement to limit competition between December 2005 and March 2013. France also accused Apple of imposing prices on retailers in the country between October 2012 and April 2017.
Describing the fine as "disheartening," Apple issued a statement defending its operations in the country and saying its investment and innovation supports more than 240,000 jobs in France, the Associated Press reported. Apple said it disagreed with the decision and plans to appeal it in court, according to the Wall Street Journal.

Insight:

It's too early to tell whether Apple will pay the record fine for allegedly violating France's antitrust law, which marks the second time in the past few weeks the country's authorities have levied a fine on the maker of iPhones and iPads. Last month, Apple agreed to pay a €25 million fine to settle charges around its failure to inform customers that iOS updates could slow their iPhones. That investigation came after Apple disclosed in 2017 that it slowed older iPhones with degraded batteries to prevent unexpected shutdowns, Macrumors reported.

The latest fine on Apple comes as big technology companies face greater antitrust scrutiny in Europe and the U.S. The European Union's top antitrust authority began preliminary investigations into Apple, Amazon, Facebook and Google's parent company Alphabet. As Apple faces greater antitrust scrutiny, the company is considering whether to make rival apps more prominent on iPhones and iPads and to open its HomePod smart speaker to other streaming audio providers, Bloomberg reported last month.

Apple also faces challenges as the coronavirus pandemic disrupts its supply chain and retail operations. The company this week closed all retail stores outside of China, where it had recently reopened stores on signs that the outbreak of COVID-19 was less of a threat after originating in the country late last year. Apple plans to keep stores closed at least until March 27, CEO Tim Cook said in an announcement.

The company plans to host its annual Worldwide Developers Conference (WWDC), when it typically announces upcoming upgrades to its iOS mobile operating system, as a virtual event in June. A leaked version of iOS 14 obtained by 9to5Mac indicates that Apple is developing new features for the iPad Pro, iPhone 9, Apple TV remote and AirTags — a product that will let people track personal items.