Why Apples latest gadget is catching the attention of antitrust regulators

On Tuesday, Apple announced the release of AirTag, a small, electronic tracker people can attach to keys, a piece of luggage, or anything, really, and then use Apples Find My system to find that item. For Apple fans, its another handy product. But for Tile, the maker of a similar tracker, the long-awaited announcement is another sign of Apples anti-competitive behavior.

Tile is once again encouraging Congress to take a closer look at Apple ahead of a Senate antitrust hearing, where Tiles general counsel, Kirsten Daru, will testify alongside executives from Spotify, Match, Google, and Apple. The hearing comes as Apple has repeatedly been accused of anti-competitive behavior due to its requirement for all iOS apps to be distributed through Apples App Store, where Apple takes a commission for sales.

But in the case of the new AirTags, the criticism goes further. Tile says that Apple is not only creating hardware thats similar to its own, but is also designing Apple software in a way that favors its own products and disadvantages Tiles products.

We welcome competition, as long as it is fair competition, said CJ Prober, Tiles chief executive officer, in a statement soon after Apples AirTag announcement. Unfortunately, given Apples well-documented history of using its platform advantage to unfairly limit competition for its products, were skeptical.

Apple AirTags, which go on sale at the end of April, do what Tiles products have done for a while: keep track of things. The new trackers use Bluetooth technology to locate these lost items. AirTags also feature the U1 chip, which uses ultra wideband technology for more precise object location. This approach and even the physical design of the trackers is very similar to what Tiles been doing for years. Tile also uses Bluetooth to locate objects, and the company is in the midst of launching ultra wideband capabilities (along with an augmented reality feature) on its trackers.

One big difference between the new AirTags and Tile trackers: Tile relies on Apple to keep its location-tracking tools running smoothly in the Apple App Store and iOS, but not the other way around. Tile has long argued that Apple unfairly designed its mobile operating system, iOS, and the Find My app to favor its own location-tracking tools. Tile did not respond to Recodes request for comment ahead of Wednesdays hearing.

Apple, for its part, has pushed back against this criticism.

Apple created Find My over a decade ago to help users locate and manage lost devices in a private and secure way, the company told Recode in a statement. We have always embraced competition as the best way to drive great experiences for our customers, and we have worked hard to build a platform in iOS that enables third-party developers to thrive.

The standoff between Apple and Tile has been years in the making. Rumors emerged back in 2019 that Apple was working on a tracker system that would compete with Tiles products. Daru, Tiles general counsel, told Congress last January that Apple was making it harder for users to connect their iPhone to Tile devices by requiring permissions in iOS 13.5 that were buried in settings, and prompting users to turn off those permissions after the devices had been set up. Daru also claimed that Apples Find My app competed with Tiles own app. Tile sent a letter to European authorities accusing Apple of anti-competitive behavior, saying that iOS 13.5 was built to favor Apples Find My app over Tiles app, among other complaints. Apple strenuously denied the allegations.

Following the volley of lawyer letters, Apple announced last summer that it would be launching a new program that would enable third-party trackers to work with its Find My app. But it wasnt until early April of this year two weeks ahead of the AirTags launch that Apple finally updated the Find My app to allow it to work with third-party devices.

Its not clear how lawmakers or regulators will react to this update. The argument that Apple unfairly nudges users toward the Find My system over Tiles system has gotten traction in Congress in the past, however. An expansive House antitrust report from last October claimed that Apples service would require companies like Tile to abandon their apps and the ability to differentiate their service from Apples and other competitors and put companies like Tile at a competitive disadvantage.

In advance of Wednesdays hearing, Sen. Amy Klobuchar called Apples announcement of AirTags timely, telling Reuters that this is the type of conduct that well be talking about at the hearing.

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