For some time now, Apple has been on the wrong side of several privacy laws, most recently a fine of over €93 million ($115.4 million) from the Italian Competition Authority (AGCM).
An investigation by the AGCM revealed that Apple abused its dominance in the Apple App Store to enforce restrictive privacy-related regulations on developers.
‘Exploitative abuse’
The investigation, which began on May 2, 2023, was described by the AGCM as “complex and was conducted in accordance with European Union standards, as well as with other international bodies concerned with antitrust laws.”
The privacy imposition by Apple began in April 2021, as reported in the AGCM press release.
According to the authority, the restriction on developers forced them to use the App Tracking Transparency (ATT), a prompt developed and enforced by Apple when requesting users’ privacy consent.
The report further revealed that Apple did this unilaterally, thereby denying developers the opportunity to opt out, while their own apps weren’t subject to the same imposition.
The authority said the ATT prompt alone did not satisfy GDPR requirements, so developers had to use a second consent prompt, doubling the number of consents users had to grant.
Apple, along with two of its affiliates, Apple Italia S.r.l. and Apple Distribution International, was fined to the specific tune of €98,635,416.67. The fine was for violating Article 102 of the Treaty on the Functioning of the European Union (TFEU), which they tagged as “exploitative abuse.”
Less revenue for third-party developers
Point 8 of the executive summary from AGCM highlighted how Apple’s actions affected competition and revenue:
“Although the fact that the conduct may harm competition is in itself sufficient to establish the abuse, based on well-established national and EU case law, the investigation found that the conduct did indeed produce effects, in terms of reduced revenues for developers and advertising platforms and increased costs for advertisers.”
The logic is that as consent moves from Apple’s ATT to a developer’s custom prompt, more users can choose “no.”
The drop in consent was observed to have begun when Apple implemented the ATT, leading to less tracking data and, ultimately, lower ad-based revenues. This was viewed by the AGCM as a way of reducing competition from third-party developers.
Apple’s response
Responding to the report, Apple strongly disagreed with the report and the subsequent fine decision.
They further claimed that the AGCM has disregarded the added privacy the ATT brings to Apple users by making that decision.
Denying that ATT didn’t apply to their own apps, Apple revealed that ATT was introduced to offer a simpler way to grant consent for data-tracking requests.
Apple has received other punishments from numerous EU bodies over privacy matters.
The UK, France, the EU, and other countries have fined Apple hundreds of millions of euros for privacy violations.
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