The Australian Competition and Consumer Commission (ACCC) has come out swinging against Apple and Google app stores’ market domination, saying measures are needed to address the significant market power in the distribution of mobile apps.
This was part of the ACCC’s Digital Platform Services Inquiry interim report, which found that developers need fair and reasonable terms, and better processes, for approvals.
“Apple and Google’s stores are the gateways between consumers and app developers, and it’s true that they provide considerable benefits to both groups. But there are significant issues with how this market is operating,” ACCC chairperson Rod Sims said.
“Apple and Google don’t only run the app marketplaces, they also compete within them with their own apps. They have the ability and incentive to promote their own apps over others, and they control the terms that their competitors must comply with to gain access to their stores.”
Sims said that to address this market power, the ACCC believed app developers should have more information about how their apps are made discoverable to consumers and that consumers should have the ability to change or remove any pre-installed or default apps.
“Apple and Google should also be prevented from using information collected about third-party apps to the advantage of their own competing apps,” he said.
The ACCC also raised concerns with restrictions imposed by Apple and Google which mean developers have no choice but to use Apple and Google’s own payment systems for any in-app purchases.
“Further, while Apple and Google have made efforts to remove malicious apps from the app stores, we believe they could do more to prevent and remove apps that feature, for example, subscription traps and other scams,” Sims added.
“There is a clear need for better redress and dispute resolution for consumers who are harmed by these sorts of apps, or who have disputes over payments and other issues. This situation reinforces the need for an external dispute resolution body for digital platforms including Apple and Google, as previously recommended by the ACCC.”
The ACCC has put forward a series of potential measures in response to its findings, including that consumers be able to rate and review all apps, that consumers have the ability to change any pre-installed default app on their device, that app developers be allowed to provide consumers with information about alternative payment options and that information collected by Apple and Google in their capacity as app marketplace operators be ring-fenced from their other operations.
“We have identified a number of areas where action is required and have put forward potential measures to address areas of particular concern. There is a window of opportunity for Apple and Google themselves to take steps to improve outcomes for app developers and consumers by adopting the potential measures we have identified,” Sims said.
The ACCC will revisit the issues raised in this report during the course of the five-year Digital Platform Services Inquiry and will take into account steps by Apple and Google to address the concerns identified.
“The ACCC will also take into account significant proposals and law changes in other countries which have identified similar concerns. Regulation may be required if Apple and Google fail to take steps to address the concerns identified,” he said.