Firm instead wanted to charge higher monthly fees

Jul 11, 2018 08:57 GMT  ·  By

Apple is under fire in Japan where the local antitrust watchdog accuses the company of forcing domestic carriers to sell iPhones with major discounts and higher monthly fees.

This approach helped the Cupertino-based tech giant sell iPhones at prices lower than devices belonging to the competition, according to a report from Reuters citing the Fair Trade Commission (FTC).

“Obliging carriers to offer subsidies (for iPhones) could have prevented the carriers from offering lower monthly charges and restricted competition,” the FTC was quoted as saying.

Apple forced the same strategy on NTT Docomo, KDDI Corp, and SoftBank Group Corp., according to the report, and customers were locked into contracts that in some cases ran for four years.

Similar investigation in 2016

The Japanese FTC first started an investigation on Apple’s sales practices in 2016, but at that point, the company agreed to discuss its contracts with carriers and address the complaints.

Facing accusations of antitrust violations, the firm now promises to do the same, explaining that it will allow carriers to give customers the option to purchase iPhones without discounts but instead stick with lower monthly fees.

Apple’s iPhones are the most expensive smartphones on the market right now when purchased without a carrier contract, and teaming up with mobile network operators has helped the company make its products available around the world despite the high price.

iPhone X, the anniversary model that launched last year, reached a new milestone in terms of pricing, starting at $999 in the United States for the base model. The 256GB storage version is priced at $1,049.

This year’s generation could take pricing even higher, as Apple readies a larger iPhone X Plus that would technically be more expensive than the standard model and thus set a new record in terms of how expensive the company’s smartphones are when purchased outright.