Indian consumer regulator escalates probe into Apple's software warranty terms

By Aditya Kalra

NEW DELHI, Sept 15 (Reuters) - India's consumer regulator is examining Apple's software warranty terms in an investigation of the iOS 18 update alleged to have damaged iPhone functionality, compelling users to pay "exorbitant" sums for repairs, documents show.

The sparring is shaping as Apple's latest headache in a growth market where it is fast expanding iPhone manufacturing and rapidly growing market share, but also fending off accusations of breaching domestic antitrust laws.

Apple AAPL.O is privately contesting the regulator's accusations, saying in an August letter seen by Reuters that providing no warranty on software is in line with global industry standards, and that iOS 18 had no systemic issues.

If found guilty, Apple may have to pay fines but more importantly could be forced to issue refunds or make changes to its business practices.

"DETAILED INVESTIGATION" ORDERED

Smartphone companies often face complaints following software updates.

In 2018, Italy sanctioned Apple for not advising consumers how the iOS 10 update could adversely impact performance of older iPhones, and for not offering support to phones out of legal warranty.

Last year, India's Central Consumer Protection Authority (CCPA) told Apple it had received a large number of complaints that the iOS 18 rollout in late 2024 led to screen display and microphone malfunctions among other issues, forcing customers to pay for related repairs, as no warranty is provided on software.

On July 29 this year, the regulator told Apple it had "escalated" the matter for a "detailed investigation" by its investigation wing, one document shows.

That raises the stakes for the company, as it signals New Delhi has not been satisfied with Apple's responses.

"The case involves alleged violations of consumer rights," the regulator said in its notice to Apple, seen by Reuters.

In a statement, Apple said it did not identify any issues or safety concerns with iOS 18 in India and would work with authorities to provide clarity on the customer response to the software.

Indian consumer law allows investigators to seek documents and hold hearings before making a final report to the regulator, said Kirti Mahapatra, a New Delhi-based lawyer specialising in consumer laws.

"Where contractual terms or warranty conditions form part of the alleged unfair practice, the CCPA can ask the company to ensure accurate information be provided to its customers," she added.

"It can also ask for changes to such terms, but that would be unprecedented."

India's consumer regulator did not respond to queries.

WARRANTY TERMS IN SPOTLIGHT

Apple says its iOS 18 underwent stringent testing and the CCPA case was based on just 75 complaints, adding that only about 11% of iPhones still used iOS 18 by June 2026.

The CCPA, however, accuses Apple of having violated the rights of "consumers as a class".

In its software licence agreements, Apple says they are "without warranty of any kind" and users must bear the entire cost of repairs if the software proves defective. The limited warranty globally only covers hardware.

In an August 20 reply to the investigators, Apple said the no-warranty clause was not unusual as consumers were told about it before installation, and followed lines similar to those of many electronics majors, such as Sony and Samsung.

"A requirement that every issue ... be treated as a breach of an absolute warranty would effectively convert any software provider into an insurer against all technological risk," it said.

India ​is a key market for Apple, with its iPhones taking a 9% share last year, up from 4% in 2022, Counterpoint Research ‌says.

Apple's response followed the regulator's July 29 notice to "formally notify" the company of the escalation.

The investigation covers complaints that green, pink or white lines appeared on users' screens after iOS 18 upgrades.

Subsequently, the regulator says, consumers had to pay "exorbitant amounts" for repairs and change of display screens, "despite the issues stemming from the company's software upgrade".

The estimated cost to service damage to an iPhone 15 screen is 27,900 rupees ($291), or more than about a third of the retail price.

"Charging consumers for issues arising from the company's own negligence violates the principle of fair trade," the CCPA told Apple.