Tech giant Apple (NASDAQ:AAPL) could very well have an upper hand when it comes to the U.S. Department of Justice’s (DoJ) antitrust lawsuit against the company, according to legal experts. The U.S. DoJ’s lawsuit alleges that the iPhone maker maintains its market dominance through exclusionary practices.
University of Chicago law professor Randy Picker told Yahoo Finance Live that he expects AAPL to win. Picker added that while the Cupertino-based company may not “prevail” in the federal court in New Jersey, the tech giant may succeed on appeals, possibly to the Supreme Court.”
Biden Administration Takes on Big Tech
Last week, in a major confrontation between Big Tech and the Biden administration, the U.S. DoJ sued Google (GOOGL) over antitrust issues while the Federal Trade Commission is also suing Amazon (AMZN) and Facebook (META) alleging violation of antitrust laws.
However, the DoJ’s lawsuit against Apple is the most wide-ranging one among these antitrust cases. Apple, on its part, has stated that it would fight these allegations of market dominance and asserted that this case is a threat that jeopardizes its very principles that sets it apart from its competitors.
Moreover, the company added that a win for the U.S. DoJ in this case “would also set a dangerous precedent, empowering government to take a heavy hand in designing people’s technology.”
U.S. DoJ’s Allegations Against AAPL
The U.S. Government has alleged that AAPL should open up its iPhone operating system (OS) to non-Apple businesses to add and run their own products. However, the tech giant has argued that opening up its iPhone OS could compromise its ability to provide integrated technology that places a higher emphasis on its privacy and security features.
On the contrary, the iPhone maker has successfully argued in earlier court cases that a tight ecosystem control protects consumers.
Additionally, the DoJ highlighted the company’s restrictive app store terms and its high fees, and its “walled-garden” approach to third-party companies in its lawsuit.
…But What if AAPL Loses the Lawsuit?
If Apple is found liable in the lawsuit, it could result in some major changes for iPhone users. According to a CNN report, this could result in iPhone users getting wider access to “super apps.” Super Apps are one-stop-shop apps that offer multiple services including messaging, ordering food, and payment processing within one platform.
The company may also be asked to offer better support for cross-platform messaging and how hardware from other companies such as smartwatches, interacts with the Apple range of devices and software.
DoJ’s Cloud Gaming Suppression
The DoJ’s lawsuit also outlines that the company may be suppressing cloud gaming. But Bank of America analyst Wamsi Mohan believes that these concerns may be unfounded. The analyst has argued that he does not consider AAPL’s iOS system as ideal for AAA gaming due to its technological limitations and gamers’ preferences. AAA gaming is a classification used to signify high-budget, high-profile games.
The analyst has a Buy rating on Apple stock and an AAPL price target of $225 implying an upside potential of 31.1% at current levels.
What is the Target Price for AAPL?
Overall, analysts remain cautiously optimistic about AAPL with a Moderate Buy consensus rating based on 16 Buys, 10 Holds, and one Sell. Over the past year, AAPL stock has gained by 9%, and the average AAPL price target of $203.87 implies an upside potential of 18.5% at current levels.
