A bipartisan bill, the Open Apps Market Act, has been introduced that would reduce the control that Apple and Google have over their respective app stores.
Introducing the bill Wednesday (Aug. 11) were Sens. Richard Blumenthal (D-Conn.) and Amy Klobuchar (D-Minn.), joined by pretty much their polar political opposite, Marsha Blackburn (R-Tenn.). While they may be far apart on most issues, they agree that there need to be "fair, clear, and enforceable rules" governing the app marketplace.
The senators argue, and with some reason, that Google and Apple have "gatekeeper control" of the dominant operating systems and app stores, power they use to dictate terms, inhibit competition and restrict choice, they argue. For example, they said "Apple has prevented the creation of third-party app stores on iPhones, required that apps exclusively use their own expensive payment system, and penalized app developers for telling users about discounted offers."
The explicit goal of the bill is to "reduce gatekeeper power in the app economy, increase choice, improve quality, and reduce costs for consumers."
The bill, which reads like an app net neutrality rule for edge providers, would prevent a covered company from restricting the use of alternative in-app payments systems; or from favoring their own terms of distribution, pricing or conditions of sale; or penalize developers for using different pricing terms or conditions via another in-app payment system.
The bill prevents a Google or Apple from using info derived from a third-party app to compete with that app.
In general, reads the bill, "a Covered Company shall not provide unequal treatment of apps in an app store through unreasonably referencing or ranking the apps of the covered company or any of its business partners over those of other apps." "Unreasonable referencing" includes algorithms that prioritize apps apps owned by the covered company or its partners but does not include "clearly disclosed" ads.
Violations will be enforced by the Federal Trade Commission since they will be considered unfair methods of competition, which the FTC has section 5 authority to police. In addition, any state attorney general can also bring a civil action based on a violation of the act and there is also a private right of action so that any developer can also sue, and get treble damages if the win.
“For years, Apple and Google have squashed competitors and kept consumers in the dark—pocketing hefty windfalls while acting as supposedly benevolent gatekeepers of this multi-billion dollar market," said Blumenthal. "I’m proud to partner with Senators Blackburn and Klobuchar in this breakthrough blow against Big Tech bullying. This bipartisan bill will help break these tech giants’ ironclad grip, open the app economy to new competitors, and give mobile users more control over their own devices.”
Sen. Blackburn was singing from the same hymn book.
“Big Tech giants are forcing their own app stores on users at the expense of innovative start-ups,” she said. “Apple and Google want to prevent developers and consumers from using third-party app stores that would threaten their bottom line. Their anticompetitive conduct is a direct affront to a free and fair marketplace. Senator Blumenthal, Klobuchar, I are committed to ensuring U.S. consumers and small businesses are not punished by Big Tech dominance.”
Contributing editor John Eggerton has been an editor and/or writer on media regulation, legislation and policy for over four decades, including covering the FCC, FTC, Congress, the major media trade associations, and the federal courts. In addition to Multichannel News and Broadcasting + Cable, his work has appeared in Radio World, TV Technology, TV Fax, This Week in Consumer Electronics, Variety and the Encyclopedia Britannica.
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