Google and Apple scare us, according to app makers in Congress

Some app makers who rely on Apple and Google’s mobile distribution are afraid of the amount of power the tech giants have over their businesses, according to congressional testimony delivered Wednesday.

“We’re all scared,” Jared Sine, legal director of Match Group, told Sen. Amy Klobuchar, D-Minn., Chairman of the Senate antitrust judicial subcommittee at a hearing Wednesday.

The hearing brought together representatives of Apple with Google and several of its most outspoken critics, including Match Group, owner of the dating site Tinder; Tile, which creates devices that help users find lost objects and face new competition from Apple’s AirTag technology; and Spotify streaming music service.

The hearing comes as lawmakers on both sides of the aisle are working on updates to antitrust laws that could give a better account of the power some tech giants have in many digital markets. This includes the ability of platforms like Apple and Google to manage the major application distribution platform, while increasingly making their own competitors more negative.

Throughout the hearing, app creators expressed fear for how easily any company could shrink their business by making small changes to their app store rules. They also complained about high rates for purchases since the application and unclear application of the rules.

Several executives accused Apple and Google of threatening their businesses.

Sine said Google called Match Group Tuesday night after its testimony was made public to ask why its testimony differed from the company’s comments on its latest earnings call.

In the earnings call, Match executives had said they believed they were having productive conversations about Google’s 30% payout in their Google Play store. But in statements, Match complained that Google had made “false claims of open platform” and complained about its “monopoly power.”

Wilson White, senior director of public policy and government relations, said it sounded like employees working on Google’s business development team were contacted to ask an “honest question.” Wilson said he didn’t see it as a threat “and we would never threaten our partners” because Google needs app developers to use its app store to be successful.

Senator Richard Blumenthal, D-Conn., Said the call was “potentially actionable.”

Klobuchar said he planned to delve deeper into the issue.

Spotify legal director Horacio Gutierrez said he could think of “at least four clear examples of threats and retaliation” from Apple after Spotify decided to talk about alleged anti-competitive behavior and Apple’s tariffs for digital product developers purchased through its platform. It included threats to remove the Spotify app, refuse to promote it, or wait for months for minor app updates to be approved, he said.

“They basically threw us the book in order to make it difficult for us to keep up our decision to talk,” he said.

Many app makers have complained about the costs porters make for purchases made from digital services to the app.

Gutierrez complained about what he called Apple’s “gag order” about how it can communicate with its own users on how to upgrade to its paid version.

For example, Spotify allows customers to upgrade only outside of their iOS app to avoid Apple’s 15% to 30% commission on digital services purchased through their platform. But because Spotify doesn’t sell the paid service through its iOS app, Apple also doesn’t allow the app creator to talk about updates with customers through the app; instead, users must update using a web browser on a PC or other method. .

At the same time, Apple operates a competing service, Apple Music, which has no such restrictions. Gutierrez claimed that this gives the Apple version an unfair advantage.

Representatives from Apple and Google told lawmakers that their fees for developers are intended to cover the costs of distributing apps across their platforms and insuring them properly. Apple’s chief compliance officer Kyle Andeer compared the services offered in the App Store today to the costly and costly process app makers they had to pursue to distribute their apps before the App Store existed.

White formed the group as a set of “small but vocal” voices from “mostly big companies.” He said he was concerned that, in trying to satisfy his complaints, “we are damaging the foundation that has allowed the Android open source ecosystem to work so well for a much larger set of small and medium-sized businesses.”

In addition to complaints about tariffs, developers were concerned that Apple’s own rival products would encourage it to make decisions unfavorable to them.

For example, Tile’s general counsel Kirsten Daru said the company had asked permission from Apple to use ultra broadband (UWB) technology on iPhones to make its article tracking technology more accurate than you can use only Bluetooth. He said Apple had turned down the request and then reserved the technology for its own competitive AirTags, which it announced Tuesday.

While Apple is developing a way for third-party developers to leverage more accurate location data, Daru said that to access it, “we need to give Apple unprecedented control over our business and led customers in the Find My app find their lost items. “

Andeer argued that AirTags is a separate product from Tile, which currently has the majority of the space’s market share, and that opening up tools to more external developers will foster competition.

App makers also complained that Apple’s application of its app store rules may seem arbitrary and delay the release of key features. Apple may tell developers what rule they’ve broken, but not exactly how or what to do to fix it, Sine said.

He said Tinder had tried to send a version of its app with a feature designed to protect its LGBTQ + users by notifying them when they were in a country where they might be at risk of exposing their sexuality or gender identity. Sine said it took two months and a conversation between the top executives of the owner of Match Group IAC and Apple to fix the problem.

An exchange between subcommittee ranking member Mike Lee, R-Utah and Andeer revealed how complex the Apple App Store rules can be.

Lee asked Andeer to differentiate why a paid service through Tinder could incur a commission while one for Uber could not. Andeer explained that an Uber customer pays for a non-digital service (a car to show up at home), while not expecting the same return from Tinder, saying it would be a different service, in what seemed like a hint of work sexual.

App makers stressed their reliance on app stores because of their unprecedented access to consumers. But, they argued, it’s not the symbiotic relationship that Apple and Google like to paint.

“We’re not successful at what Apple has done, we’ve had it despite Apple’s interference,” Gutierrez said. “And we would have been much more successful for their anti-competitive behavior.”

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