When you hear the phrase “app store,” there’s a good chance Google’s Google Play Store or Apple’s App Store come to mind. Both companies dominate the app economy, with about a combined total of 143 billion apps downloaded from their respective app stores in 2020, which is more than half of the 218 billion apps downloaded worldwide. With this much influence, it’s no surprise that Apple and Google have been accused of adopting gatekeeping behavior that has hamstrung competition and harmed app developers. Back in May, Apple and Epic Games were duking it out in the courts after Epic Games alleged that Apple took a hefty 30% commission on in-app purchases, unlawfully prevented consumers from sideloading apps—which is installing applications without using the device’s official app store—and restricted developers from using their own services that handle in-app purchases.
The Open App Markets Act
Thus, on Wednesday, August 11, US Senators Richard Bluementhal (D-Connecticut), Marsha Blackburn (R-Tennessee), and Amy Klobuchar (D-Minnesota) introduced legislation S.2710, also known as the Open App Markets Act. “This legislation will tear down coercive anticompetitive walls in the app economy, giving consumers more choices and smaller startup tech companies a fighting chance,” said Bluementhal.
This bill targets companies that possess an app store with at least 50 million US users (so, Apple and Google). Companies are required to permit consumers to sideload applications and even allow them to “hide or delete Apps or App Stores provided or preinstalled by the App Store owner or any of its business partners.” Although Android already lets its users download apps from alternative app stores, 36 states and Washington D.C. have sued Google for allegedly stunting the use of third-party app stores. Additionally, Apple vehemently claims they keep iOS devices sequestered from unauthorized apps in the name of security and safety. To accommodate this, the bill states that companies will not be punished as long as they can prove that their actions are “necessary to achieve user privacy, security, or digital safety; taken to prevent spam or fraud; or taken to prevent a violation of, or comply with, Federal or State law.” Companies are also prohibited from creating algorithms or methods that rank their own apps at the top during search queries.
The bill would also bar app-store operators from forcing developers to use their in-app payment systems and from creating terms that penalize developers who sell the same app at a different price on different app marketplaces. In addition, companies must give developers “access to operating system interfaces, development information, and hardware and software features…on a timely basis and on terms that are equivalent or functionally-equivalent to the terms for access by similar Apps or functions provided by the Covered Company or to its business partners.” If a company violates anything outlined in the act, it will be considered as “unfair method of competition under section 5 of the Federal Trade Commission Act (15 U.S.C. 5).” Developers are even given the ability to sue companies if they are hurt by any violation of this act.
Pushback and Support
The Chamber of Progress (a center-left tech industry policy coalition) criticized the bill, CEO Adam Kovacevich stating, “This bill is a finger in the eye of anyone who bought an iPhone or Android because the phones and their app stores are safe, reliable, and easy to use.” (It’s important to point out that this organization is funded by companies like Apple and Google.) Apple has also given their own statement, saying, “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.” Google has yet to speak on the new legislation.
On the other end of the spectrum, the Coalition for App Fairness (a group with members like Spotify, Epic Games, Basecamp, and ProtonMail) greatly supports the Open App Markets Act. “This will make it easier for developers of all sizes to challenge these harmful practices and seek relief from retaliation, be it during litigation or simply because they dared speak up,” states Corie Wright, Epic Games Vice President of Policy.
Whether you’re a proponent for or an opponent against this bill, you have to admit that if it is passed, it’ll be a major blow against Big Tech’s monopolistic control over markets.