Saturday, March 27, 2021

Has European Commissioner Thierry Breton already announced that Apple will have to allow alternative app stores? A matter of interpretation.

One of the first LinkedIn posts I read this morning was from the Coalition for App Fairness, which was founded last year by Epic Games, Spotify, Match Group and others. When the CAF started, I firstly wanted to wait and see, but at the start of this year I already predicted on this blog that it would keep growing. My own app development company may at some point apply for membership, but even in that case I'd obviously retain my independent opinion. It was high time someone founded the CAF, given that a couple of other organizations claim to represent app developers while in reality being paid and remote-controlled by Apple in one case, Google in the other. It's laughable when an entity claims to represent app developers but doesn't support Epic against Apple, for example.

So the CAF pointed to an article published by EU Internal Market Commissioner Thierry Breton on LinkedIn, entitled DSA/DMA Myths -- What is the EU digital regulation really about?

According to CAF's interpretation of the article, Mr. Breton is "stressing the importance that all gatekeepers allow other app stores on their platforms. This would mean that for the first time, there will be real competition for the App Store." (emphasis added)

It's obvious that I would want this to happen. Competition works wonders. This isn't just about the commission on in-app payments. When they reject your app and won't let you publish it at all or force you to give up on your original concept, your focus is not on 15%, 30% or any percentage for that matters. As Epic will argue in the May trial, alternative app stores can do a better job at curation (app reviews). I don't know whether the Epic Games Store, if it already existed on iOS, would have accepted my app (we'd have to build a Windows version and submit it to them to find out), but considering that similarly-themed games are available on Steam (a pretty meaningful point of reference), the Samsung Galaxy Store, the Microsoft Store etc., I'd be reasonably optimistic. At a minimum I would know that whoever (Apple, Epic, or any third party) rejected it would have to assume that some other app store might carry it. That would discipline all of them, and rejections would become more reasonable. Some people blame the reviewers, such as the Coronavirus Reporter complaint against Apple; I prefer to focus on structural and systemic issues, but regardless of how structural or not a problem is, competitive constraints can only help.

The European Union's envisioned Digital Markets Act could become the most important piece of legislation in the technology space ever, way above such laws as the U.S. Digital Millennium Copyright Act (the substance of which I don't mean to criticize; I vocally supported its enforcement in a case involving Blizzard Entertainment).

But the question is: is Mr. Breton actually saying in that LinkedIn article that there will be alternative app stores on iOS (and Android)?

Here's the only passage in his statement that mentions apps:

"Gatekeepers will keep digital opportunities; providers of operating systems will always be able to offer all sorts of software and apps as they wish. In addition, the DMA empowers the users who do not like the preinstalled apps to switch to a different service or use a different app offered by another provider." (emphasis in original)

The narrowest interpretation would be that users must be provided with alternatives to any preinstalled apps, either by selecting different services within an app (such as by selecting a different search engine in a search app) or installing "a different app" made by another developer. In that case, one would interpret "provider" as "service provider" in the same sense that users could switch to a different service within an app.

But one doesn't even have to interpret "by another provider" as "by a different app store" in order to arrive at the CAF's desired outcome. The Apple App Store is an app itself (as is the Google Play Store). And it's a preinstalled one. So, arguably, Apple would have to offer an alternative by another service provider (such as the Epic Games Store) to the App Store. At a minimum, the CAF's interpretation is defensible, even though I'm not going to take a definitive position on whether it's the only proper interpretation (absent additional evidence).

What Mr. Breton primarily sought to accomplish with his LinkedIn article is to debunk the "myth" that Apple couldn't offer, say, a music streaming service. Instead, the DMA would impose obligations requiring "that business users and end users are not unfairly deprived of their free choice, a fundamental postulate of [the EU's] single market." An alternative app store would be as consistent with that vision as it gets. Many roads lead to a multi-app-store ecosystem, and the DMA is one of them, at least potentially.

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