Apple Faces Antitrust Class Action Alleging iCloud Monopoly

Apple Inc. is “rigging the competitive playing field” for cloud services by unnecessarily restricting the storage of certain iPhone and iPad files to its iCloud platform, plaintiffs alleged Friday in a proposed class action.

Only iCloud, Apple’s own cloud platform, can host some data from Apple’s phones and tablets, including application data and device settings that users need to access when they replace their device, according to the complaint filed in the US District Court for the Northern District of California. This arbitrary practice has “unlawfully ‘tied’” Apple’s mobile devices and iCloud together, the complaint says.

As a result, Apple’s iCloud dominates the market with an estimated 70% share, according to the complaint.

The iCloud product is among Apple’s most profitable, producing higher margins than its other products because it has been “undisciplined by competition.”

“Apple has marked up its iCloud prices to the point where the service is generating almost pure profit. Apple’s ability to sustain these prices is a testament to its monopoly power,” the suit said.

The proposed class, with tens of millions of potential members, would include a nationwide class and a California subclass of users who bought iCloud plans and were overcharged. Apple didn’t immediately respond to request for comment on Friday.

Cloud storage allows users to store and access data remotely.

Apple does have cloud platform competitors, the complaint said, pointing to major technology companies such as Alphabet Inc.'s Google and Microsoft Corp, as well as specialists like Dropbox Inc. However, juggling multiple cloud accounts with different interfaces to store non-restricted data, such as photos, is an “unattractive option” for users, the suit said.

Hagens Berman Sobol Shapiro LLP represents lead plaintiff Julianna Felix Gamboa and the proposed class.

The case is Gamboa v. Apple Inc., N.D. Cal., No. 5:24-cv-01270, 3/1/24.