If the App Store is a fiercely guarded citadel, the headquarters are officially established, and the rams are at its doorstep! A few days ago, ahead of an important vote by the US Senate Judiciary Committee, Tim Powderly, head of government affairs for America at Apple, sent a letter to US elected officials. It obviously didn’t have the desired effect.
He enjoined them not to give their endorsement to theOpen App Markets Act, a bipartisan bill currently under consideration. It must be said that this piece of legislation has the potential to seriously undermine the economic model of the App Store, as Apple has conceived and defended it until now: a closed and controlled universe, the only gateway to their iPhones and iPads.
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One more step towards the end of hegemony
However, the Senate commission officially validated, yesterday, Thursday, February 3, this project by 21 votes for and only one against. An overwhelming majority therefore, in favor of the continuation of the legislative process. Certain senators however noted that they voted in favor of this text even if its current drafting still contained details to be corrected and amended.
As the draft is currently drafted, app download stores with more than 50 million users in the United States would no longer be able to force developers to use their platform’s payment system.
A first hitch to the foundations of the App Store, which has already had to adapt to this point in several countries, notably in South Korea. But the biggest problem for Apple would lie in another part of the text, proposal S. 2710.
It explicitly indicates that application stores would no longer have the right to impose their platform as the sole means of distributing applications. Nor could they control prices or intervene in communication between developers and their users.
“Google and Apple own the rails of the app economy, just like the railroads at the turn of the last century »explained Richard Blumenthal, elected Democrat and one of the eight senators to defend this text.
In other words, and as Marsha Blackburn, a Republican senator who also wears theOpen App Markets Actthis law project “would let people download apps directly rather than forcing them to go through blinds officials ».
A long way yet…
Now that it has been approved by the Senate committee, theOpen App Markets Act will have to be on the legislative calendar, in order to be debated, amended and voted on by the American Senate.
A process that will certainly be long and will see the text evolve significantly during various passages before the elected officials of the American high court. Nevertheless, this first step towards a vote and its adoption is a victory for those who defend this text, and want to see the economic model of the App Store undermined. This is particularly the case of Microsoft, which supports the project.
The Redmond giant has become a great advocate of free competition in the world of application kiosks since it missed its entry into this market, at the same time as it missed the smartphone revolution.
App stores are the gateway for the most popular digital platforms. Congratulations to @SenBlumenthal @MarshaBlackburn for advancing important legislation, the Open App Markets Act, which would promote competition, and ensure fairness and innovation in the app economy.
—Brad Smith (@BradSmi) February 4, 2022
Thus, Brad Smith, president of Microsoft, split a tweet at the announcement of the decision of the Senate committee. He explains that the “App Store are the gateways to the most popular digital platforms. »
After the usual congratulations to the two main senators who are carrying this bill, he recalls that theOpen App Markets Act “would promote competition and ensure fairness and innovation in the application economy”.
An argument already heard
A position which is not without foundation, it is obvious, but which is of course at the antipodes of those defended by Google and by Apple.
Google has thus indicated, through the voice of Mark Isakowitz, its government affairs officer – in other words, its lobbying efforts – that this bill “is like seeing Congress try to artificially pick winners and losers in a highly competitive marketplace”.
Echoing positions already hammered out by Apple officials, including Craig Federighi, on the occasion of the Web Summit 2021, Apple loobying boss Tim Powderly wrote in a letter sent to the Judiciary Committee:
” the sideloading (the ability to download apps outside the App Store, editor’s note) would allow malicious actors to evade Apple’s privacy and security protections by distributing apps without essential checks in both areas.”.
Before going on to say that “These provisions would open the door to a proliferation of malware, scams and other data exploitation”.
Finally, the Apple representative added that his company was “very worried” that the law in its current form “would facilitate the avoidance of consumer-friendly practices by the task of large social media platforms. »
Because, in this complex case of monopoly and consumer protection, Apple’s control over the App Store also allows it to defend the privacy of users – whatever its primary motivations may be. In this case, the Cupertino giant is referring here to its platform called App Tracking Transparency (ATT), which requires app developers in its App Store to let users choose whether or not to be tracked during their activities.
Put in place at the start of last year, with a delay due to the need to prepare the ground, this restrictive framework has caused people to cringe. This was particularly the case of Facebook, which has set itself up as a defender of small business, which would have to suffer too much from these new obstacles to advertising tracking. According to Mark Zuckerberg, the ATT could cause him to lose ten billion dollars during his next fiscal year…
“The times They are a-changing”
But’Open App Markets is not the only bill to have been validated by the Senate committee and which could upset the American economic App, and therefore worldwide.
Two weeks ago, another text, theAmerican Choice and Innovation Online Act, followed the same path. Its first name said a lot about its intentions: Ending Platform Monopolies ActWhere Law to end platform monopolies.
Faced with this powerful wave, Google and Apple will certainly continue their lobbying work to influence these various texts. Knowing that a proposal very close in spirit, the Digital Markets Actcould have the same effect in Europe.
The year 2022 could well see the end of the era of App Store kings. The question is whether the multiplication of offers will be accompanied by the apocalypse announced by Apple, or if it will just offer more choice, and will require the various players to be even more attractive to retain users.
Source: Bloomberg