Consumer group Which? has launched a £3billion claim against Apple, claiming the tech giant has breached competition law by ‘forcing its iCloud services on customers’.
It says Apple has encouraged users to sign up to iCloud to store photos, videos and other data and is therefore favouring its own products, while simultaneously making it difficult to use alternative products, ultimately stifling competition.
Which? says Apple does not allow customers to store or back up all of their phone’s data with a third-party provider, and users of its iOS operating system have to pay for the service when the amount of data being stored goes over the 5GB free limit.
In its claim, the consumer group also accuses Apple of overcharging users for iCloud subscriptions, partly because the company’s dominance of the market means it is difficult for new alternatives to emerge and provide competition.
The group said it is seeking damages for all affected Apple customers who have obtained iCloud services since October 1, 2015, which it estimates is around 40 million people.
They say individual customers could be owed an average of £70, depending on how long they have been paying for the service.
Which? has urged Apple to resolve the claim without the need for litigation by offering consumers their money back, and opening up its operating system to allow users more choice for cloud services.
Which? chief executive Anabel Hoult said: ‘We believe Apple customers are owed nearly £3billion as a result of the tech giant forcing its iCloud services on customers and cutting off competition from rival services.
‘By bringing this claim, Which? is showing big corporations like Apple that they cannot rip off UK consumers without facing repercussions.
‘Taking this legal action means we can help consumers to get the redress that they are owed, deter similar behaviour in the future, and create a better, more competitive market.’
Apple say that there is no requirement to use iCloud and say that 50 per cent of their customers neither use or pay for an iCloud+ subscription.
The company also argue that their pricing is inline with other cloud storage providers
In a statement, Apple said: ‘Apple believes in providing our customers with choices. Our users are not required to use iCloud, and many rely on a wide range of third-party alternatives for data storage.
‘In addition, we work hard to make data transfer as easy as possible — whether its to iCloud or another service. We reject any suggestion that our iCloud practices are anticompetitive and will vigorously defend against any legal claim otherwise.’
Professor Pinar Akman, a law professor specialising in competition law at the University of Leeds, told a victory for Which could force Apple to change the way iOS lets people back up their data.
‘Collective actions, where a class representative seeks damages on behalf of very large numbers of consumers, arising out of a competition law violation have become commonplace in the UK over the last few years.
‘The Competition Appeal Tribunal is a specialist competition tribunal with jurisdiction to decide these competition law cases and there are dozens of such cases pending at the Tribunal at the moment. Many of the ongoing collective actions are against big tech companies and involve very large sums in terms of potential damages.
‘If Which? can succeed in proving a relevant violation of competition law, such as by proving that Apple holds a dominant position and abuses that position, and (that there are) damages arising out of that violation for UK consumers, such as through paying an excessive price for the services in question, then the Tribunal can decide to award damages to compensate potentially millions of UK consumers.
‘The potential claim is one that concerns a possible abuse of a dominant position. If a violation of competition law is proven, then the court can order remedies, which will seek to restore competition on the market.
‘The remedies can be wide-ranging and would normally require the company in question to terminate any violation which the court has found. Terminating the violation can, indeed, necessitate a change of business practices on the part of the company in question.’