Keep Government out of App Stores

By: Katie McAuliffe

Mobile app stores should not be the subject of an antitrust investigation. The focus of antitrust should be and has been focused on consumer welfare, not preferencing one competitor over another. Some companies trying to take advantage of new found antitrust zeal to expand their bottom line, but any government mandate in this space would cause consumer harm especially when it comes to security and privacy. 

There is not an antitrust issue in the app marketplace. Americans can choose the iPhone, especially with if they put a premium on security and privacy – Apple has always included privacy and security by design and their focus on privacy is a company mission – or Americans can choose a more open platform like Google’s Android where they can download any choice of app marketplace, such as Google Play, Samsung Galaxy Store, Amazon Appstore, 1Mobile Market AKP, etc. In fact, there are more than 20 options for users to choose from. 

The proposed “solutions” of mandated sideloading and price fixing are unwarranted. The requirement of sideloading on mobile devices can create substantial privacy and security concerns for consumers because apps loaded outside of a trusted marketplace are not scanned for malware, privacy settings, or security standards by a third party that requires certain standards to participate in their app marketplace. This exposes individuals to vulnerabilities particularly when it comes to personal data protection. For the average user, it is much easier, safer, and more reliable for them to use app stores as a method for downloading apps and making purchases because in the event something goes wrong the consumer can quickly and safely contact the market place for assistance or a refund. The more technically savvy users can choose an open platform if they want to option to sideload, but this shouldn’t be mandated.

Currently, when an app developer wants to have their app distributed through an app store, they pay a commission ranging from 15-30%. Only the top 1 or 2% of apps pay the industry standard of a 30% commission and small app developers tend to pay nothing. Recently, large companies that are heavily reliant on apps, like Spotify and Epic Games, are taking aim at app stores to do away with commission fees and create other avenues to share their applications.

These large developers are attempting to use current anger at tech companies over speech issues to assist in their bottom line and avoid commission-based app stores. They have pushed for state regulation that would do away with commission-based systems and require devices to permit sideloading, and have filed antitrust lawsuits against the various app marketplaces. Government, at the federal or state level, should not regulate prices private companies charge. There is plenty of evidence that consumers are the beneficiary of the app marketplace model and there are plenty of models to choose from. 

All levels of government should remember the guiding principle is what is best for consumers. It is not the government’s job to enter a bottom line fight and choose one competitor over the other in a functioning free market.

Photo Credit: Rahul Chakraborty