Creators of mobile software have complained for years that app stores take an unfair share of revenue that should go straight to them, with two behemoths calling the shots and collecting whatever tolls they see fit. In response to these worries, a group of senators presented a new measure this week that, if enacted, would severely limit Apple and Google’s influence over app purchases in their operating systems and totally disrupt the way mobile software is delivered.
The Open App Markets Act would provide a number of rights for app developers that are tired of handing over 30% of their income to Apple and Google. Companies that manage operating systems would be required to enable third-party programmes and app stores, according to the law, which is posted in full below.
This would also prevent firms informing developers from informing consumers about cheaper versions of their products available outside of approved app stores. Apple and Google would also be prohibited from using “non-public” data collected through their platforms to develop competitive apps.
Senator Richard Blumenthal (D-CT) said, “This legislation will tear down coercive anticompetitive walls in the app economy, giving consumers more choices and smaller startup tech companies a fighting chance.” Senators Richard Blumenthal (D-CT), Marsha Blackburn (R-TN), and Amy Klobuchar (D-MN) presented the bipartisan measure (D-MN). Klobuchar heads the Senate’s antitrust panel, which also includes Blackburn and Blumenthal.
Senators Blackburn and Klobuchar both stated that Apple and Google’s app store tactics are a “direct affront to a free and fair marketplace,” and that their actions create “serious competition concerns.”
The measure is based on evidence gathered earlier this year during a hearing on app stores and competition held by that panel.
Tile, Spotify, Google, Apple, and Match Group all testified in front of lawmakers, saying that anti-competitive app store restrictions had hurt their firms. “… We urge Congress to swiftly pass the Open App Markets Act,” Spotify Chief Legal Officer Horacio Gutierrez said of the new bill. “Absent action, we can expect Apple and others to continue changing the rules in favor of their own services, and causing further harm to consumers, developers, and the digital economy.”
A developer advocacy organization, the Coalition for App Fairness, welcomed the law for its potential to encourage digital market innovation. “The bipartisan Open App Markets Act is a step towards holding big tech companies accountable for practices that stifle competition for developers in the U.S. and around the world,” CAF executive director Meghan DiMuzio said.
Apple lowered its own fees for companies with less than $1 million in App Store revenue from 30% to 15% last year with the aim of avoiding regulatory problems in the future. Developers have long grumbled about the exorbitant fees they must pay to sell their applications through the world’s two most popular mobile platforms.
Epic Games defied Apple’s payment regulations by enabling Fortnite users to pay Epic directly over the last year, igniting a court battle with far-reaching ramifications for the mobile software industry. The verdict is due later this year, following a May trial.
In Google, apps that do not have access to the google play store don’t get installed on smartphones. Official app stores, on the other hand, make apps safer and more user-friendly. While Apple and Google charge exorbitant fees for distributing mobile software through the App Store and Google Play Store, the firms say that doing so protects users from viruses and enables timely software upgrades to address security issues that may compromise user privacy.
“At Apple, our focus is on maintaining an App Store where people can have confidence that every app must meet our rigorous guidelines and their privacy and security is protected,” an Apple spokesperson said.
The proposed plan is a “finger in the eye” for Android and iPhone users, according to Adam Kovacevich, a former Google policy officer who now runs the new tech-backed business organization Chamber of Progress.
“I don’t see any consumers marching in Washington demanding that Congress make their smartphones dumber,” Kovacevich said. “And Congress has better things to do than intervene in a multi-million-dollar dispute between businesses.”