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European Union regulators on Monday accused Apple of violating new tech rules by not fully allowing app store consumers to be steered elsewhere.
In a set of preliminary findings, the E.U. found the company to be the first in breach of the Digital Markets Act, a sweeping set of rules designed to prevent Big Tech from stifling competition. It holds that app developers must be allowed to inform users of cheaper alternatives outside an app store – a practice known as “steering.”
“Steering is key to ensuring app developers are less dependent on gatekeepers’ app stores and for consumers to be aware of better offers,” wrote Margrethe Vestager, E.U. executive vice president in charge of competition policy.
Apple said it would continue to listen and engage with the European Commission.
“We are confident our plan complies with the law, and estimate more than 99% of developers would pay the same or less in fees to Apple under the new business terms we created,” the company said in a statement.
Experts said the accusation from the European Commission signals that regulators are serious about forcing Apple to open up its app store to meaningful competition. Apple’s current fee structure won’t be enough to satisfy regulators, said Gene Kimmelman, who served as the Justice Department’s deputy associate attorney general in the early parts of the Biden administration.
“European regulators have made it clear that Apple must totally revamp and possibly eliminate most of the fees imposed on developers and those seeking to open competitive app stores,” Kimmelman said.
The E.U. took issue with several policies that Apple applies to app developers, such as preventing them from providing pricing information within its app or promoting certain offers. They also flagged rules applied to linking customers to other apps, as well as certain fees that Apple charges.
The accusations come four months after the E.U. opened an investigation that focused on steering rules by Apple and Alphabet.
Apple said in a statement that it has made a number of changes in recent months after getting feedback from developers and European regulators. The company said all developers doing business in the E.U. on the app store can use new capabilities from the company, including the ability to direct users to the web “at a very competitive rate.”
The E.U. also said it opened a new probe into Apple’s contractual terms with developers. Specifically, it is looking into a fee of half a euro (about 54 cents), which developers must pay for each installed app, and an Apple membership program for developers. It is also probing the “multistep user journey” required to download and install an alternative app store on iPhones.
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Two thoughts
1) Apple has used their walled garden in anti-competitive ways and brought some of this government regulation upon itself.
2) The EU regulations seem capricious and written by government regulators who are either clueless at how technology works, or who are trying to use the law to get what they want, which is Apple to be broken up.
It’s just Europeans trying to make up for their lack of innovation and their non-competitive position by using the heavy finger of regulation on the scale. Not surprising from a continent that has stifled upward mobility and invention for centuries.
There is also that.