Should the government be able to decide what apps your smartphone can download? With the recently introduced Open App Markets Act, the federal government is looking to put itself right in the middle of the fight between app developers and mobile operating systems.
The Open App Markets Act would force companies to allow third party app stores and other apps to be downloaded directly to devices through a process known as “sideloading.” Additionally, it would require the creator of the app store to allow alternative payment options outside of their own app store. These requirements would only apply to companies that have more than 50 million app store users.
This legislation comes on the heels of a slew of similarly written state bills all marketed as a way to protect consumers from the monopoly power of Google and Apple and their popular mobile operating systems. In reality, however, bills like these are aimed at helping app developers, not doing what’s best for smartphone users.
Just look at what House Sponsor Ken Buck said in a recent statement: “For far too long, companies like Google and Apple have had a stranglehold on app developers who are forced to take whatever terms these monopolists set in order to reach their customers.” Rep. Buck’s concerns center on app developers, not smartphone users. It’s no wonder app developers have been the driving force behind these legislative proposals.
This legislation started as an intra industry fight between Epic Games and Apple. Epic is the maker of the hugely successful game Fortnite, which is free to play online. Epic monetizes Fortnite through in-game purchases, and when these purchases are made on an iPhone, Apple takes a cut. Wanting to lower these transaction costs, Epic sued Apple for antitrust violations alleging that Apple disallowing alternative app stores or payment methods on their iPhone constituted an antitrust violation. These same arguments have spread to the Android mobile operating system through a state-led antitrust lawsuit as well as legislation like the Open App Markets Act.
Allowing app creators to reduce or remove their payments to app stores may seem like a win for those companies, but what about consumers? Talk to many Apple users about why they purchase their product, and you’ll most likely hear the same testimonial on repeat: “It just works.” That’s no accident. Apple is notorious for having strict app standards to make sure consumers have an integrated product free from malware. iPhone users also only have to deal with Apple when disputing transactions, which saved them more than a billion in potentially fraudulent transactions in 2020. Sure, these devices are not as open as other platforms, but that seems to be a choice consumers are willing to make.
Those wanting a more customizable experience can easily purchase a variety of Android phones that already allow for sideloading and multiple app stores. Samsung, which sells the most Android devices in the United States, has its own app store preloaded onto its phones. Why force Apple to be Android?
Like most legislation aimed at big tech companies, this legislation fails to consider the preferences and welfare of consumers. Instead, it looks to help app developers at the expense of smartphone users. Congress should stop trying to fix a smartphone and app store market that’s far from broken.
By: Eric Peterson | The Pelican Institute
Eric Peterson (@Eric_Peterson_ ) is the director of the Pelican Center for Technology and Innovation in Louisiana. He lives in New Orleans.