Apple’s ban attracting federal scrutiny

May 05, 2010|Joelle Tessler, Associated Press

WASHINGTON — Federal regulators plan to examine whether Apple Inc. is violating antitrust rules by requiring software developers to use its programming tools to create applications for the iPhone and iPad.

Officials at the Justice Department and the Federal Trade Commission are sorting out which agency will examine Apple’s new policy, according to a person with knowledge of the inquiry. Apple’s policy prevents developers from using outside tools such as Adobe Systems Inc.’s Flash format to design apps for Apple’s devices.

The person with knowledge of the inquiry, who was not authorized to speak publicly, noted that it is in a preliminary stage. The two agencies regularly scrutinize whether corporate conduct could stifle competition, and not all inquiries result in a formal investigation. Apple declined to comment. The Federal Trade Commission and the Justice Department had no comment.

A key question facing regulators is whether Apple hurts competition by forcing software developers to choose between designing apps that can run only on the iPhone and iPad and those that can run on rival devices such as Google’s Android phones and Research in Motion’s BlackBerry.

Apple’s new policy, which was announced in April, has raised concerns for Adobe, which includes Flash as part of a package of software tools sold to professional designers and Web developers. Although Apple’s decision to ban Flash limits what its iPhone and iPad can do, the popularity of the devices has led many software developers to design apps without the format.

Adobe had no comment yesterday. But last week, the company said Apple’s “attempt to position this solely as a technology issue is a smoke screen.’’ Instead, Adobe said, Apple was trying to protect a business model that locks developers and consumers into its tools and services.

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