Apple CarPlay is anticompetitive, too, US lawsuit alleges

Apple CarPlay is anticompetitive, too, US lawsuit alleges

Buried in the 88-page antitrust lawsuit filed by the US Department of Justice against Apple is a reference to everyone’s favorite phone-projection system, CarPlay.

The DOJ says that, like smartphones, vehicle infotainment systems have become a new way in which Apple exhibits anticompetitive behavior to harm consumers as well as its competitors.

Apple’s plans to introduce a more immersive version of CarPlay, in which the system displays key aspects of the vehicle’s functions like speed and HVAC, are further evidence of the company’s illegal monopoly over smartphones, prosecutors say.

Infotainment systems have become a new way in which Apple exhibits anticompetitive behavior

“By applying the same playbook of restrictions to CarPlay, Apple further locks-in the power of the iPhone by preventing the development of other disintermediating technologies that interoperate with the phone but reside off device,” the lawsuit says.

The inclusion of CarPlay, as well as digital key functions through Apple’s Wallet feature, came as a surprise to some analysts, who say that the DOJ may be misunderstanding the utility and functions of the phone-mirroring system.

This is especially true for the next-generation version, which prosecutors described insidiously as taking “over all of the screens, sensors, and gauges in a car, forcing users to experience driving as an iPhone-centric experience if they want to use any of the features provided by CarPlay.”

That’s misleading, said Sam Abuelsamid, principal analyst at Guidehouse Insights and an expert on vehicle software. “Even with the next-gen system, OEMs [original equipment manufacturers] don’t actually have to let Apple take over all the screens,” he said in an email. “They can limit the interface to whichever screens they want.”

Automakers still need to build a basic software interface so vehicle owners can adjust their air conditioning, change the radio station, or operate native navigation maps, Abuelsamid said. They can’t assume every vehicle owner has a smartphone, let alone an iPhone, that they’ll project on their car’s infotainment screen. And the car needs to be able to function in the absence of a smartphone.

“Apple further locks-in the power of the iPhone by preventing the development of other disintermediating technologies”

Also, there’s no cost to the customer for switching to Android Auto, the other popular phone-mirroring service owned by Google. And even in vehicles that feature Google’s Android software natively, owners aren’t prevented from using CarPlay if they want.

Apple CarPlay is immensely popular, with broad swaths of Americans citing it as a must-have for future car purchases. Only General Motors has made the decision to cut off access to all phone-mirroring services for its electric vehicles, citing a desire for a more “holistically integrated” software experience. (The move has proven to be very unpopular with car shoppers.)

GM may also have cut off access to CarPlay for reasons other than holistic integration. The company likely balked at sharing data with Apple, which was working on its own secretive car project for over a decade. That work, known as Project Titan, came unceremoniously to an end last month — which could ultimately lead GM to reconsider its decision, Abuelsamid said.

Digital keys also make a cameo in the Justice Department’s lawsuit. The keys, which use a phone’s near-field communication (NFC) or ultra wideband (UWB) technology to lock, unlock, or start a car, is another cross-platform technology used by Apple to cement its dominance in the smartphone market, DOJ says. Prosecutors use the example of Apple requiring developers to add digital keys developed for their own apps to Apple Wallet in order to function.

“Even with the next-gen system, OEMs don’t actually have to let Apple take over all the screens.”

“The default status of Apple Wallet steers users to the Apple Wallet rather than allowing third parties to present digital car keys only in their own cross-platform app, increasing dependence on Apple and the iPhone whenever they use their car,” the complaint reads. “At the same time, it decreases the incentives of automakers to innovate because automakers are forced to share data with Apple and prevented from differentiating themselves as they could absent Apple’s conduct.”

Apple’s digital key technology complies with the standards established by a cross-industry consortium of automakers and tech companies, Abuelsamid notes. Still, the company has been “tight fisted” with access to its NFC and UWB chips, and its requirements that it operate through Apple Wallet probably has more of an impact on other payment apps than apps developed by the auto industry.

Mike Ramsey, a vice president at Gartner, says if Apple makes digital keys work really well, it could be a win for consumers despite running afoul of the law.

“The tension here is that Apple’s raison d’etre is a low-friction, easy-to-use experience and forcing apps to integrate into its secure Apple wallet system ensures a better consumer experience,” Ramsey said. “Of course, it also helps give Apple control over digital key apps in a way that seems anticompetitive.”


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