Here’s a Guide to the U.S. Antitrust Case Against Big Tech Companies

The U.S. government is sharpening its antitrust scrutiny of Big Tech. In a sign that formal inquiries could be forthcoming, the Justice Department and Federal Trade Commission last week divvied up antitrust oversight for Apple Inc., Amazon.com Inc., Facebook Inc. and Alphabet Inc.’s Google.

While the timing caught some by surprise, the companies have been preparing for this moment for a while, hiring lawyers and lobbyists and publicly making their case. History may be on their side: Corporate breakups are a significant, and rare, undertaking for the U.S. government. The last major breakup of a monopoly was AT&T in 1982. Microsoft was ordered split up by a federal judge in 2000 after the Justice Department sued the software company in 1998, a decision that was reversed on appeal.

In the past few years, there has been a groundswell of calls to at least rein in, if not break up, technology companies that are seen by some as having become too big and powerful in many ways. U.S. Senator Elizabeth Warren has made perhaps the most detailed case for breaking up and regulating the four companies, but the Massachusetts Democrat is not alone in her aggressive views on the industry.

Any formal investigation will take a long time. Government scrutiny of Microsoft lasted years. As all sides dig in, here’s a look at some of the issues the government could home in on as it builds its case, and some of the ways the companies might argue their way out.

APPLE

The Case:
Though perhaps best known for the iPhone, Apple’s vulnerability is the App Store, which supports tools and games for mobile devices and increasingly holds the key to the company’s growth. Apple and Google control more than 95% of all mobile app spending by consumers in the U.S., meaning that most developers must work with them to reach millions of smartphone users. Spotify Technology SA is among those that have long complained about the 30% cut Apple takes of each app, claiming it amounts to an effective tax on competitors. Some smaller developers sued Apple this week, claiming the App Store suppresses competition. The European Union is already preparing to look into the case and Warren, in her proposal, said the App Store should be separated from the rest of Apple because its own apps compete with those of outside developers. Last month the Supreme Court ruled that a large antitrust case, regarding App Store pricing, could proceed.

The Defense:
Chief Executive Officer Tim Cook is adamant that Apple is “not a monopoly” in any way. He points to its share of the smartphone market in the U.S., which is only about 30% and is even lower on PCs. ``We don’t have a dominant position in any market,” he said in an interview Tuesday with CBS. Apple has long sought to distinguish itself from the rest of big tech, from providing tighter security on its hardware and software to highlighting that it doesn’t monetize users’ data. Regarding the App Store, Apple recently added a new section to its website to show the benefits it provides to developers, such as reaching a huge global audience and handling payment and identity details, thereby taking friction out of the sign-up process. Apple, along with Google, has also pointed out its ability to filter out fake apps and malicious software, making its store more secure.

FACEBOOK