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Italy fines Apple and Samsung for pressuring customers to buy new phones through software updates

Apple was fined about $11.4 million. (David Paul Morris/Bloomberg News)

Italian antitrust officials have fined Apple and Samsung, alleging that the phone manufacturers pressured customers to download software updates that led to device malfunctions, which ultimately pushed customers to buy newer products.

The Italian Competition Authority (ICA) said in a news release Wednesday that it had fined Samsung and Apple the maximum prescribed amount for the scope and severity of their alleged unfair business practices. The antitrust body fined Samsung 5 million euros (about $5.7 million) and Apple 10 million euros (about $11.4 million). Apple’s fine included a second penalty for allegedly not properly informing customers about the lithium batteries used in iPhones, including their average duration and deterioration factors and how customers should maintain and replace them to preserve a device’s full functionality.

The antitrust agency said the companies induced consumers to download software updates that “caused serious malfunctions and significantly reduced their performance, in this way speeding up their replacement with more recent products.” The ICA also said that a major “information asymmetry” exists between consumers and manufacturers, leaving device owners without the know-how to restore their phone’s full capacity.

The ICA said its investigations targeted Samsung’s Note 4 and Apple’s iPhone 6.

Last year Apple acknowledged that its software slowed down old iPhones as their batteries aged. Lithium-ion batteries become less effective over time and are less capable of holding a charge, which can lead to a device abruptly shutting down.

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Apple said it had changed its software last year for models of the iPhone 6 to improve “power management during peak workloads to avoid unexpected shutdowns.” The company said the power management may go unnoticed but “in some cases users may experience longer launch times for apps and other reductions in performance.” The company said in December that it would never intentionally shorten the life span of its products or degrade the user experience to push customers to buy newer phones.

Earlier this year, Apple said it had received questions from “some government agencies” about the software update that slowed down older iPhones, but the company did not reference any specific agency. Bloomberg News reported in January that the Justice Department and the Securities and Exchange Commission have asked Apple for more information about the software update to determine whether Apple may have violated securities laws.

At the height of Apple’s battery controversy last year, Samsung told the website Phone Arena that it does not slow down phones with older batteries.

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Samsung said in a statement to The Washington Post on Wednesday that it is “disappointed” with the ICA’s decision, which it plans to appeal. “Samsung did not issue any software update that reduced the Galaxy Note 4′s performance. In contrast, Samsung has always released software updates enabling our customers to have the best experience possible.”

Apple didn’t immediately respond to a request for comment.