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Europe wants to punish Apple for playing favorites with its apps

Wednesday, June 17, 2020 by Robinhood Snacks |
_When the ref is your dad_

When the ref is your dad

"You are the Apple of my eye"... Apple to its own apps. Apple's App Store is a massive marketplace for the world's scrolly-tappy desires. But in addition to owning that marketplace, Apple also competes in it with its own apps: Apple Maps, Books, Podcasts, etc.

  • iControl: In addition to pre-downloading some apps on your iPhone, Apple often displays them higher than arguably more-worthy competitors on its App Store. For instance Apple Music is currently #1 and Spotify comes up #5 for a "music" search.
  • iMoney: Apple also takes a 15%-30% cut of paid downloads, in-app purchases, and subscriptions in non-Apple apps.
  • iAngry: That rubs some the wrong way — especially the EU, which has launched 2 antitrust probes to determine whether Apple violated competition laws.

Silicon Valley dominates Europe's scrolly-tappy ways... The EU hates that Apple, Facebook, Google, and Amazon are making bank off hundreds of millions of European users — without really paying any European taxes. And it hates the home-court advantage:

  • The EU is investigating Apple for rival-squashing with its App Store and Apple Pay policies. If Apple is found guilty, Europe could fine it for a 10% cut of its annual sales.
  • Preemptive defense: On Monday, Apple announced that the App Store generated $519B in 2019 revenues for global developers.
  • In press release speak: "The results encapsulate...the dynamic, competitive, and flourishing app economy, which has unleashed a torrent of innovation across 175 countries." Key word: competitive.
THE TAKEAWAY

This is a wider "platform-player" issue... The EU is investigating other American tech giants too, saying they're abusing home court advantage on their own platforms. BTW — the US government is also running its own antitrust investigations. Platforms like the App Store have created an explosion of opportunity and wealth, but they seem to be playing favorites.