The story so far:
A U.K. consumer protection group called ‘Which?’ has filed a £3 billion claim against Apple as it represents U.K. customers who paid for the company’s iCloud services since October 1, 2015. The consumer group claims that Apple’s customers were locked into using iCloud and forced to pay unfair prices for it, as the iPhone-maker violated competition law in the process.
How does Apple iCloud work?
Apple’s iCloud is a storage service that allows Apple customers to back up their device-based data such as photos, videos, emails, files, and more. They can then access the stored media from other devices or through the web.
For example, if a user who dropped their iPhone into the sea had opted for automatic backup to iCloud, they would not have to worry about losing precious videos of a deceased pet, voice memos from their loved ones, the poem they were composing on their phone, the health metrics they were planning to show their doctor, their saved passwords, important to-do lists, downloaded books, device-based text messages, and more, since these would be preserved through iCloud.
Naturally, storing so much data from different apps and features — and constantly updating it — takes up space. With the free version of Apple’s iCloud, users get 5 GB of storage. However, they can subscribe to various iCloud+ plans, which offer up to 12 TB of storage, if they need more space. The premium plans also come with additional privacy and security features.
Why is the U.K. consumer group taking legal action against Apple?
‘Which?’ believes that Apple forced its iPhone and iPad customers to use iCloud and did not give them fair ways to explore rival cloud services. By the group’s calculation, Apple owes customers around £3 billion.
According to the group, Apple gave greater preference to its own cloud storage service on devices such as iPhones and iPads, and tied iCloud to these iOS devices. As a result, ‘Which?’ claimed that Apple customers were locked into using iCloud, finding it harder to switch to other services, and were caught in an environment that let Apple overcharge users. The group also claimed an iOS monopoly across Apple systems helped it get an “unfair advantage” in the cloud storage market as well. “A key tactic to achieve this has been encouraging users to sign up to iCloud for storage of photos, videos and other data while simultaneously making it difficult to use alternative providers, because Apple does not allow customers to store or back-up all of their phone’s data with a third-party provider. iOS users then have to pay for the service once photos, notes, messages and other data go over the free 5GB limit,” said the ‘Which?’ press team in a statement on November 14. If legal action is successful, the group estimated that the average damages per consumer would be around £70 (approximately ₹7,458.92).
This action by ‘Which?’ has been filed with the Competition Appeal Tribunal. The group said it wants Apple to address the grievances by giving customers back their money and opening up the iOS ecosystem, thus avoiding litigation.
Eligible customers in the U.K. will be part of the legal proceedings by default, but they can opt out if they want to. Meanwhile, eligible users overseas can request to be part of the proceedings. Now, ‘Which?’ must get permission from the Competition Appeal Tribunal to act as a class representative.
However, Apple has rejected the allegations about iCloud’s anticompetitive practices, pointing out that using its cloud storage service was not compulsory and that there were alternatives.
The iPhone- maker said it would defend itself against legal claims, according to a Reuters report.
Will Google’s Cloud offerings also come under legal review?
The U.K. consumer group is specifically targeting Apple in its legal case, alleging anti-competitive action such as restricting alternative options and locking in customers. ‘Which?’ has pointed to how the dominance of iOS on Apple devices boosted iCloud’s dominance in the cloud market.
By contrast, the Android market has more options for cloud services that are easy to install and use across diverse devices, with less of a “walled garden” structure.
Google itself offers both Drive and Cloud services. While Drive enables file sharing by using cloud features and AI, Google Cloud lets enterprises and developers run more complex operations with its tools. A user with a basic Google Account also gets 15 GB of storage for free, which applies to their Gmail, Google Drive, and Google Photos.
While Google is not mentioned in this particular claim by the U.K. consumer group, the internet giant has been deemed a monopolist in the search engine market, after a high-profile trial in the U.S.
While it is not certain whether the legal claim by U.K.’s ‘Which?’ will move forward successfully, the case will likely spark both customers and regulators across the world to question whether cloud service providers — be they Apple, Google, Microsoft, Amazon, or others — should be pulled up for their market practices and fee structure.
Published – November 18, 2024 08:30 am IST
