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Open App Markets Act

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Open App Markets Act
Great Seal of the United States
Long titleA bill to promote competition and reduce gatekeeper power in the app economy, increase choice, improve quality, and reduce costs for consumers.
Announced inthe 117th United States Congress
Number of co-sponsors10
Legislative history

The Open App Markets Act (OAMA)[1] is a proposed antitrust bill in the United States Congress. The Senate version of the legislation, S.2710, was introduced on August 11, 2021, by Richard Blumenthal (D-CT), Amy Klobuchar (D-MN) and Marsha Blackburn (R-TN).[2] On August 13, 2021, a companion bill in the House of Representatives was introduced by Hank Johnson (D-GA) and Ken Buck (R-CO).[3]

The legislation aims to prevent Apple and Google, operators of the App Store and Google Play, respectively, from engaging in what supporters of the legislation deem anti-competitive practices in app markets. The Open App Markets Act is intended to protect the ability to sideload apps and prevent operators of app marketplaces from "self-preferencing" their own products. On February 3, 2022, the Senate Judiciary Committee advanced the legislation in a 20–2 bipartisan vote.[4]

Background

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Both Apple and Google have received national and international scrutiny regarding their operation of their in-house app marketplaces. In Epic Games v. Apple (2020), developer Epic Games sued Apple for restricting applications on its App Store from featuring other in-app purchasing methods. Epic Games founder Tim Sweeney had criticized Apple for taking a 30% revenue cut from purchases made in the App Store.[5]

In July 2021, a group of 36 states and the District of Columbia filed a lawsuit against Google, alleging that the company abuses its market power through Google Play.[6] In August 2021, the National Assembly of South Korea voted to amend the country's telecommunications law to ban Apple and Google from requiring developers to use their in-house payment systems.[7]

Provisions

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The legislation applies to companies with 50 million users in the United States that operate app marketplaces. Provisions of the legislation include:[8][9]

  • A prohibition on requiring that app developers use the company's in-app payment system
  • Prohibiting the so-called "self-preferencing" of apps, where app marketplace operators advantage their own products at the expense of other developers
  • Requiring that app market operators allow for the download of third-party applications
  • Preventing app developers from being penalized for selling apps on a separate app marketplace at a lower price

Support and opposition

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Support

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As of June 13, 2022, the Senate version of the legislation, introduced by Blumenthal, has been co-sponsored by eleven senators.[10] The House companion bill introduced by Johnson, H.R.5017, has seven co-sponsors.[11] Ahead of the Senate Judiciary Committee vote, the Open App Markets Act received support from the CEOs of 20 tech companies, including Spotify.[12] A poll conducted by the Coalition for App Fairness (CAF) found that 84% of app developers surveyed supported the legislation.[13][14]

The American Economic Liberties Project (AELP), an anti-monopoly organization, urged lawmakers to pass the legislation.[8] Tennessee Republican Marsha Blackburn, a co-sponsor of the legislation, argued that the legislation would "take power away from Big Tech and give it to the free market". Tom Ridge and Janet Napolitano, who served as Secretary of Homeland Security in the Bush and Obama administrations, respectively, have endorsed the legislation on security grounds.[15]

In January 2022, a coalition of Chinese human rights activists and advocacy organizations wrote to the Senate Judiciary Committee in support of the legislation.[16] Signatories to the legislation include Yang Jianli, a former Tiananmen Square activist, the Uyghur Human Rights Project (UHRP), and Tibetan rights groups. The activists argued that:[17]

"If we were allowed to provide apps outside of the censored App Store, also known as sideloading, we would be able finally offer Chinese communities with tools to defeat the Great Firewall, such as Ultrasurf, Psiphon, and FreeGate."

Opposition

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Both Apple and Google publicly opposed the legislation, with Google vice president Mark Isakowitz arguing the bill would "destroy many consumer benefits that current payment systems provide and distort competition by exempting gaming platforms, which amounts to Congress trying to artificially pick winners and losers in a highly competitive marketplace.”[8] Apple CEO Tim Cook has criticized the legislation, arguing it would harm user security.[18]

The Chamber of Progress, a tech industry trade group, criticized the bill on user security grounds, arguing that the sideloading provisions of the legislation posed a threat to consumers.[19] Despite voting to advance the legislation in the committee, California Democrat Dianne Feinstein expressed concern that the legislation would disproportionately impact Apple and Google, both of which are headquartered in her state.[20]

Legislative history

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Congress Short title Bill number(s) Date introduced Sponsor(s) # of cosponsors Latest status
117th Congress Open App Markets Act. H.R.5017 July 13, 2021 Hank Johnson (D-GA) 7 Referred to Committees of Jurisdiction.
H.R.7030 March 9, 2021 Hank Johnson (D-GA) 20 Referred to Committees of Jurisdiction.
S.2710 July 11, 2021 Richard Blumenthal (D-CT) 14 Referred to Committees of Jurisdiction.

Procedural history

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On February 3, 2022, the Senate Judiciary Committee voted to advance the legislation in a 20–2 bipartisan vote, with only Republicans John Cornyn (R-TX) and Thom Tillis (R-NC) voting in opposition.[4]

See also

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References

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  1. ^ Seitz, Jacob (2022-04-14). "Digital groups rally as Apple pushes back against App Store legislation". The Daily Dot. Retrieved 2022-04-15.
  2. ^ "Blumenthal, Blackburn & Klobuchar Introduce Bipartisan Antitrust Legislation to Promote App Store Competition | U.S. Senator Richard Blumenthal of Connecticut". www.blumenthal.senate.gov. Retrieved 2022-02-26.
  3. ^ "Congressmen Johnson, Buck Introduce Bipartisan Plan to Rein in App Store Monopolies". Congressman Hank Johnson. 2021-08-13. Retrieved 2022-02-26.
  4. ^ a b Feiner, Lauren (2022-02-03). "Senate committee advances bill targeting Google and Apple's app store profitability". CNBC. Retrieved 2022-02-26.
  5. ^ Leswing, Kif (2020-07-24). "Fortnite maker: 'Apple has locked down and crippled' the App Store". CNBC. Retrieved 2022-02-26.
  6. ^ McCabe, David; Wakabayashi, Daisuke (2021-07-07). "Dozens of States Sue Google Over App Store Fees". The New York Times. ISSN 0362-4331. Retrieved 2022-02-26.
  7. ^ Shead, Saheli Roy Choudhury, Sam (2021-08-31). "South Korea passes bill limiting Apple and Google control over app store payments". CNBC. Retrieved 2022-02-26.{{cite web}}: CS1 maint: multiple names: authors list (link)
  8. ^ a b c Robertson, Adi (2022-02-09). "Everything you need to know about the bill that could blow up the app store". The Verge. Retrieved 2022-02-26.
  9. ^ Blumenthal, Richard (2022-02-17). "Text - S.2710 - 117th Congress (2021-2022): Open App Markets Act". www.congress.gov. Retrieved 2022-04-04.
  10. ^ "Cosponsors - S.2710 - 117th Congress (2021-2022): Open App Markets Act, S.2710". www.congress.gov. 17 February 2022. Retrieved 2022-06-14.
  11. ^ "Cosponsors - H.R.5017 - 117th Congress (2021-2022): Open App Markets Act". www.congress.gov. 2021-08-13. Retrieved 2022-02-26.
  12. ^ Klar, Rebecca (2022-01-28). "App company CEOs urge senators to back antitrust bill". The Hill. Retrieved 2022-02-26.
  13. ^ Evers-Hillstrom, Karl (2022-01-31). "8 in 10 app developers back measure to rein in Google, Apple: poll". The Hill. Retrieved 2022-02-26.
  14. ^ Black, Lucy (2 February 2022). "App Developers Support Open App Markets Act". www.i-programmer.info. Retrieved 2022-03-27.
  15. ^ Krishan, Nihal (April 11, 2022). "National security bigwigs split over bills targeting Amazon, Apple, and Google". Washington Examiner. Retrieved 2022-05-03.
  16. ^ Miller, Andrew Mark (2022-02-01). "Chinese human rights activists back bill to crack down on Big Tech, China app market control". FOXBusiness. Retrieved 2022-03-14.
  17. ^ "Chinese Human Rights Letter on Sideloading". United States Senate. January 31, 2022.
  18. ^ Rodrigo, Chris Mills (2022-04-12). "Tim Cook cautions against antitrust legislation". The Hill. Retrieved 2022-04-15.
  19. ^ Zilbermints, Regina (2022-02-03). "Senate panel advances bill targeting Apple, Google app store power". The Hill. Retrieved 2022-02-26.
  20. ^ Zakrzewski, Cat (February 3, 2022). "Apple avoided the Washington techlash for years. Now it's at the center of the bull's eye". The Washington Post. Retrieved February 3, 2022.
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