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Apple accused of competition abuse over tracking apps

Apple has been accused of abusing its power to unfairly favour one of its own products over that of a smaller rival, in a move that could exacerbate the tech giant’s regulatory woes in Europe.

In a letter sent to European competition commissioner Margrethe Vestager on Tuesday, California-based tracking app maker Tile argued that Apple was making it more difficult for users to operate its product on their smartphones compared to Apple’s own rival application, FindMy, by selectively disabling features that allow for a seamless user experience.

Tile, whose Bluetooth tracking technology allows users to find their keys, phones or other items, also called on the European Commission to open a probe into Apple’s business practices, having made similar accusations in the US earlier this year.

The tracking app maker claims that recent changes made by Apple to its operating system have resulted in a more frustrating customer experience when using Tile, as the US tech giant prepares to launch a new competing product.

“In the past twelve months, Apple has taken several steps to completely disadvantage Tile, including by making it more difficult for consumers to use our products and services,” said Tile’s general counsel Kirsten Daru in the letter seen by the Financial Times. 

“This is particularly concerning because Apple’s actions come at the same time that Apple both launched a new FindMy app that competes even more directly with Tile and also began preparing for the launch of a competitive hardware product,” the letter added.

Apple devices come with its tracking app preloaded into the iOS operating system, allowing users to locate people and other Apple products.

The company is reportedly also working on a piece of hardware that will be attached to items like TV remote controls or bikes to track them in a similar manner to Tile’s square plastic tags — though using new ultra-wideband chip technology which analysts believe will provide a superior level of precision.

Among Tile’s allegations is that Apple has made it more difficult for consumers to grant permission for its app’s tracking activities by defaulting the “always allow” function of non-Apple apps to “off” in the latest version of its operating system.

But for its FindMy app, Ms Daru said, Apple defaults the “always allow” function to “on” during the setting up of an iPhone, creating a seamless experience.

Tile also said the appearance of frequent data access permission reminders triggered by the absence of the “always allow” function “denigrates the user experience, creates consumer frustration and undermines the integrity of our product”.

It also claimed that its product is being denied “equal placement” of Apple’s user interface on the App Store, while adding that Apple has terminated its agreement to sell Tile products in its physical retail stores in anticipation of the launch of a new hardware product.

“We strenuously deny the allegations of uncompetitive behaviour that Tile is waging against us,” Apple said in a statement. “Consistent with the critical path we’ve been on for over a decade, last year we introduced further privacy protections that safeguard user location data. Tile doesn’t like those decisions so instead of arguing the issue on its merits, they’ve instead decided to launch meritless attacks.”

The new accusation of alleged anti-competitive practices in Europe will increase pressure on regulators to take action against Apple. 

Brussels is investigating the company after music streaming app Spotify accused the iPhone maker of anti-competitive behaviour by charging digital content providers a 30 per cent fee for using their payment system for subscriptions sold on its app store. A formal probe is expected to be announced later this year.

The European Commission said of Tile’s complaint: “We have received the letter to which we will reply in due course.

“Our preliminary investigation into Apple’s alleged anti-competitive practices through its App Store policies is ongoing. We cannot comment on or predict its timing or outcome.”

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