February 1, 2023
The Department of Commerce’s National Telecommunications and Information Administration (NTIA) released s new report today that found the current mobile app store model is harmful to consumers and developers. Apple and Google act as gatekeepers over the apps that people and businesses need, NTIA said in its “Competition in the Mobile Application Ecosystem” report. Inflated prices and reduced innovation due to the companies’ policies have the potential to harm consumers, according to NTIA.
Based on more than 150 comments from a diverse set of stakeholders, NTIA identified two main policy issues holding back competition in the app ecosystem – from the agency’s press release:
- Consumers largely can’t get apps outside of the app store model, controlled by Apple and Google. This means innovators have very limited avenues for reaching consumers.
- Apple and Google create hurdles for developers to compete for consumers by imposing technical limits, such as restricting how apps can function or requiring developers to go through slow and opaque review processes.
The report recommends multiple changes to open the app ecosystem to greater competition, innovation and potential benefits for users and developers, including:
- Consumers should have more control over their devices. They should be able to choose their own apps as defaults, use alternative mobile app stores, and delete or hide pre-installed apps.
- App store operators should not be able to “self-preference” their apps in an anticompetitive manner. Operators should not be able to favor their own apps in how they appear in search results or discriminate against other apps that are similar to their own.
- Operators should lift restrictions on alternative ways for consumers to download and install apps. While still preserving appropriate latitude for privacy and security safeguards, legislative and regulatory measures should prohibit restrictions on sideloading, alternative app stores and web apps.
- Addressing limits on in-app purchasing options. This can be done by banning requirements that developers use the app store operators’ in-app payment system.
“New legislation and additional antitrust enforcement actions are likely necessary to boost competition in the app ecosystem,” NTIA concludes.