White House calls Apple and Google 'harmful' in bid to cut app store fees

AppleInsider · February 1, 2023 11:35AM

The National Telecommunications and Information Administration wants Apple and Google to be forced to have third-party app stores, saying that as-is, the model inflates prices and reduces innovation.

As Apple prepares to raise App Store prices outside the US, the NTIA says that Apple and Google's business model "is harmful to consumers and developers."

Following an investigation, then NTIA says it has found that the current "mobile app store model has provided a range of benefits to both app developers and users, but has also created conditions of competition that are suboptimal."

"The policies that Apple and Google have in place... have created unnecessary barriers and costs for app developers," says the NTIA's full report, "ranging from fees for access to functional restrictions that favor some apps over others."

The Executive Branch claims that "in some areas, such as in-app payments, it is unclear how the current system benefits anyone other than Apple and Google."

It argues that "given the growing importance of this ecosystem to our economy," and also to the people of the United States, Congress should "pursue measures... to open the ecosystem to greater competition."

Google already allows sideloading of apps from alternative sources, but Apple has protested against it. The NTIA acknowledges Apple's position, but points out that others disagree.

"While Apple and Google provide reasons why some measures might be in place, such as the benefits to users in increased security and privacy protections, and to developers in terms of access to markets and development tools," it says, "many commenters challenge the technical necessities of these choices and question whether other models could provide similar if not greater benefit."

During the investigation, Apple filed a comprehensive account of its reasoning for its App Store rules. Those reasons concentrated on Apple's privacy stance plus how the company believes it has helped around 20 million app developers reach customers.

"Apple believes in vibrant and competitive markets and through the App Store," an Apple spokesperson told AppleInsider, "we've helped millions of developers around the world turn their brightest ideas into apps that change the world."

"Today, third party apps are among the most popular on the App Store, contributing to a robust app economy that includes millions of apps and supports hundreds of thousands of US jobs," continued the spokesperson. "We appreciate the report acknowledges the importance of user privacy, data security and user convenience."

"Nevertheless, we respectfully disagree with a number of conclusions reached in the report, which ignore the investments we make in innovation, privacy and security," said Apple, "all of which contribute to why users love iPhone and create a level playing field for small developers to compete on a safe and trusted platform."

The new report comes after President Biden's op-ed in the Wall Street Journal, calling for more bipartisan efforts against Big Tech firms and their use of users' personal data.

Updated 07:50 with comments from Apple.

Read on AppleInsider

DAalseth · February 1, 2023 12:13PM

Oh you’re probably not going to want comments on for this one

Hedware · February 1, 2023 12:14PM

Somehow everybody gets asked except for consumers. As a owner of Apple products, I do not want my privacy and security compromised because some lazy developers want to have open skies. They should attempt to build some decent apps.

Wavelan_312 · February 1, 2023 12:44PM

I specifically purchased Apple products because I want the closed ecosystem.

Maybe Apple should consider having two app stores. One store could be based on the closed system with more privacy, The other App Store could be more open less private ad-based and less expensive.

darelrex · February 1, 2023 1:07PM

Hedware said:

Somehow everybody gets asked except for consumers. As an owner of Apple products, I do not want my privacy and security compromised because some lazy developers want to have open skies. They should attempt to build some decent apps.

Exactly. Are all those people who voluntarily choose to shop at Macy's being unwittingly "harmed," and the government needs to save them from that harm by outlawing the Macy's markup? (which, BTW, is much larger than Apple's)

coolfactor · February 1, 2023 1:37PM

The fact that Apple's iOS and Google's Android have survived the birth and growth of the "mobile app" industry, and others didn't, is not a fault of theirs, and they should not be punished for it. If government wants to help this situation, they should offer grants to develop competing platforms. Even Microsoft and Blackberry (RIM) failed at that, so we know it's no easy task. Does Samsung have their own, or did they toss in the towel, too?

What's ironic is that everybody wants interoperability and competing platforms at the same time. You can't have both. The more platforms there are, the harder it becomes for app developers because now they need to support a wider array of platforms. So who's at a disadvantage now? Who's paying more in the name of "openness"?

bshank · February 1, 2023 1:49PM

It’s fake optics to make it look like the administration is addressing inflation.

9secondkox2 · February 1, 2023 2:04PM

Um… let’s see… these systems are SUPPOSED to benefit Apple and Google. They’re the ones paying for infrastructure. Beyond that, it’s seems consumers have benefitted greatly in terms of convenience, security, and peace of mind. No one wants it to be like the Wild West days of internet yore.

This has got to be the most inept and desperate administration in history.

rob53 · February 1, 2023 2:05PM

I think the government is upset because they can't continue the Microsoft monopoly in the federal government. It would be much easier for their IT staff to only have to deal with Microsoft garbage instead of other products. The federal, and probably state, governments are so tied to Microsoft products (especially costly client licensing) that they can't or refuse not to see how anything else could be better. Consumers have spoken in the mobile marketplace and it doesn't include Microsoft. They keep saying Apple and Google cost people too much money while conveniently not doing anything about the cost of oil, gasoline, pharmaceuticals, housing, food, and just about everything else. Even though some Apple products are costing more, their features and power continue to escalate, something the other things I mentioned don't do. We all know our government is beholden to corporations, at least the ones who bride them the most. Sorry, I meant to say make the largest contributions to their reelection (this is legal bribery, BTW). Apple also has to spend lots of money trying to product us from our own government's attack on what and how we buy things. I have used Apple products since the late 1980's. This was my choice, nobody told me I had to buy Apple products. Of course, when I actually worked for the government, they felt they could tell me what I had to buy but even then I fought it and in many cases won. These attacks on Apple have been going on for decades and it doesn't matter which party is in power. I know what I want to use, I know what I feel is better for me and my family. I don't need some ***** person in Washington DC telling me what's good or bad. I do have a choice in where I shop and there's no way our government can force me to shop where they want me to shop without breaking all kinds of basic laws. Of course, this is exactly what they continue to try and do.

BirderGuy · February 1, 2023 2:07PM

Wait, what ? The two companies who are responsible for the creation of the most successful search and phone technologies are being accused of stalling innovation? Seriously ? Literally every business charges 15-30% markup to make enough profit to stay in business? I guess we should make sure no company is able to make enough money to innovate so that smaller companies can produce more crap? And this from the single president of the US who is 80 years old and grew up with black and white televisions and rotary phones? I wonder how we got to Apple and Google without innovation from such companies? Maybe there should be competing presidents. Why should Biden have all the power. We need a republican, democratic and independent president serving simultaneously so they can innovate and always have a 2/3 majority when voting to sign a bill to help create a level playing field and encourage innovation

Madbum · February 1, 2023 2:36PM

This White House , which I regretfully voted For

is fast tracking our families to a Nuclear War vs Russia….

is helping European Union bashing America’s greatest companies while doing nothing against European companies

a complete shit show in more ways than one ….

mike1 · February 1, 2023 2:37PM

For what it's worth, this appears to be the e-mail address to send comments.

[email protected]

charlesn · February 1, 2023 2:45PM

You know who they didn't consult about Apple's App Store? The countless millions of customers who vote with their wallets and CHOOSE Apple products specifically for the safety and privacy of its closed ecosystem, making it the most successful and admired tech company in history. I'm a Democrat, but this is an example of the effing Nanny State at its worst. I have far cheaper choices than Apple in the marketplace that don't have closed ecosystems and I CHOOSE not to buy them. I don't want my choices dictated by a bunch of luddite octogenarians who think that TikTok is a Chinese plot to infiltrate American alarm clocks and who rely on their interns to stop them from trying to put stamps on email.

It's also insane to be lumping Google and Apple in the same basket. Google's entire business model is built on collecting and monetizing user data often without disclosing to users how they're being packaged and sold... until they get caught. Then Google just figures out a new and sneakier way of doing it until they caught again.

And by the way, if you're angry about this, posting here accomplishes nothing. Look up who represents you in the Senate and House if you don't already know, and email THEM.

genovelle · February 1, 2023 2:48PM

bshank said:

It’s fake optics to make it look like the administration is addressing inflation.

You do know that inflation has decreased 4 months in a row. Ironically the gas prices here jumped as much as 40 cents to the exact same price the night before the election, then suddenly fell back to the falling prices. Well, all of the stations run but big oil. Walmart and their partner stations did not go up. I think the hater companies have gotten in the ears of the right people and the administration doesn’t understand the whole picture.

Just like the chips and the supply chain issues, the eggs are a problem we are lucky to have Biden because he actually will work to find a solution. When half of the chickens are dead from avian flu, there is going to be an egg shortage.

Dude is far from perfect as shown here, but he is effective

foregoneconclusion · February 1, 2023 2:48PM

Why isn't desktop/laptop software cheaper than mobile software? Why haven't third party stores and a wide variety of payment methods on desktop/laptop ensured a consumer paradise of the lowest software prices and highest software innovation? Why aren't small developers the kings of desktop/laptop software?

The problem with most of the governmental "let's force third party stores on iOS" stuff is that it completely ignores the real history of desktop/laptop software. A lot of what Apple did with iOS was specifically geared to avoid the stranglehold that legacy software developers had achieved on desktop/laptop operating systems.

ranson · February 1, 2023 2:55PM

Hedware said:

Somehow everybody gets asked except for consumers. As a owner of Apple products, I do not want my privacy and security compromised because some lazy developers want to have open skies. They should attempt to build some decent apps.

I fail to understand how this compromises YOUR security. It's very simple. If YOU don't want to use a third party store or sideloading to have access to an app, then YOU don't have to. See, no security problem for YOU. But others, who want to put software on their phone that Apple has declined to list in their App Store, should have that opportunity, given it is their device that they own. None of that compromises YOUR security in any way.

I hear the argument that "well, there are apps that will move to their own stores instead of Apple's, and then we can't trust the app maker to not do nefarious things." Fine, then don't install the app. If you can't trust their product because it's not in Apple's Store, then frankly, you can't trust the app at all and should not use it. Note that numerous scam apps are in the Apple Store already (see this AI article from just this morning), and popular apps like Tik Tok and Facebook actively track you in spite of the tracking transparency options. So again, if you think you wouldn't be able to trust them outside of the Apple store, those apps being in the Apple store is really no different. It's a completely false sense of security.

So nobody's security is unwillingly compromised here. We are adults, and we can make informed decisions about what apps to install, even when it runs counter to Apple's opinion. This harms no one except those who choose to go down that road and make bad choices.

mikethemartian · February 1, 2023 2:55PM

That’s a picture of the Capitol building, not the White House.

foregoneconclusion · February 1, 2023 2:57PM

bshank said:

It’s fake optics to make it look like the administration is addressing inflation.

FYI...inflation has been falling for the past six months in the United States.

https://apnews.com/article/december-2022-inflation-report-72bb938a443ab0500bd72d23f62214ad

foregoneconclusion · February 1, 2023 3:01PM

ranson said: I fail to understand how this compromises YOUR security. It's very simple. If YOU don't want to use a third party store or sideloading to have access to an app, then YOU don't have to. See, no security problem for you. But others, who want to put software on their phone that Apple has declined to list in their App Store, should have that opportunity, given it is their device that they own. None of that compromises YOUR security in any way.

That would only be true if there was a legal requirement for developers to make their app available in the App Store as well as in third party stores.

Madbum · February 1, 2023 3:02PM

Just wrote to my congressman

Congressman Khanna

I noticed the Democrat administration is bending over backwards to help the EU destroy American companies like Apple.

I buy Apple because specifically I like how they protect my privacy. Forcing a 3rd party App Store opens up my phone and computer to Chinese or Russian spyware.

Why are Democrats doing this? The company leading this, Epic Games, is a 49 percent Chinese CCP owned company that prays on young kids with its own App Store!

Congress needs to wake up . How about asking consumers what we want? And not bureaucrats and politicians ?

Your voter in Sunnyvale

rob53 · February 1, 2023 3:09PM

charlesn said:

…..

And by the way, if you're angry about this, posting here accomplishes nothing. Look up who represents you in the Senate and House if you don't already know, and email THEM.

You do realize that unless money accompanies that email nothing will be done. It’s been a long time since members of Congress actually listened to the 90%. Corporations and PACs run this country funded by the top 5%. The other 5% just plays around a lot doing nothing.

White House calls Apple and Google 'harmful' in bid to cut app store fees

Comments