A new report commissioned by the White House has further increased antitrust pressure on the App Store. The report concludes that the control exerted by Apple and Google leads to excessive prices for apps and potentially stifles innovation.
The report supports changes to proposed antitrust laws that received bipartisan support in Congress but were not enough to pass into law.
Antitrust Pressure on Apple's App Store
The App Store is Apple's biggest antitrust problem, as regulators around the world have concluded that the iPhone maker's exclusive control over iOS app sales is anti-competitive. Some developers argue that the restrictions imposed by Apple limit what their apps can do - in some cases, they can't compete directly with the iPhone maker's apps, such as Wallet - and that they are forced to pay Apple a $15 or $30 commission, driving up prices for users. Apple counters that its tight control of the App Store protects users from malware and other rogue apps. The evidence shows the company is far from perfect in this regard. Yet the argument is that things would be worse without Apple's control procedures.
White House report
The White House has commissioned the National Telecommunications and Information Administration to investigate. Axios reportedthat it too has come to the conclusion that an antitrust law is necessary.
A new report from the Biden administration describes Apple and Google as "gatekeepers" of mobile app stores and suggests that legislation is needed to spur competition and provide more choice for app makers and consumers. The way Apple and Google operate their app stores has "real potential for harm to consumers" as the companies "drive up prices and stifle innovation," NTIA Administrator Alan Davidson said in a phone interview with reporters.
Alternative App Stores: Apple has realized that the company cannot win the battle
Biden administration officials said both the Justice Department and the Federal Trade Commission should be guided by the report and consider it policy advice. Apple spent a record amount of money lobbying against antitrust cases in the US last year. Senator Amy Klobuchar, the sponsor of the American Choice and Innovation Online Act, said her bill was blocked by an "incredible flood of money" from lobbyists. However, the Cupertino-based company appears to have recognized internally that it is likely to lose this battle and is devoting "significant resources" to allowing alternative app stores on its platform. (Photo by ZapIchigo / Bigstockphoto)
