[Update: Rejected] Proposed North Dakotan bill aims to dismantle Apple and Google’s app store and payment monopolies
This might just be the year that Apple’s walled garden ecosystem gets some doors, windows, and a breath of fresh air. A bill proposed in the North Dakota Senate in the USA seeks to ban digital stores like the Apple App Store and the Google Play Store from exercising a distribution monopoly and force third-party developers on their platform to strictly use their platform-respective in-app payment systems.
The Senate Bill 2333 (via TheVerge) targets “digital application distribution platforms” that “exceed $10 million in annual revenue”, and not smartphone app stores in particular. But its wide definition does indeed put the crosshair on both Apple and Google. This bill, if it passes through and becomes law for the state of North Dakota in the USA, will restrict platforms from:
- Requiring a developer to use a digital application distribution platform or digital transaction platform as the exclusive mode of distributing a digital product.
- Requiring a developer to use an in-application payment system as the exclusive mode of accepting payment from a user to download a software application or purchase a digital or physical product through a software application.
- Retaliating against a developer for choosing to use an alternative application store or in-application payment system
Essentially, app distribution platforms and concerned payment platforms cannot exercise monopoly use from developers. They also cannot retaliate against developers for choosing an alternative store or payment platform. Do keep in mind that the proposed legislation will only affect business within the state of North Dakota. But to implement these changes, both Apple and Google will have to make fairly big changes to their policies, leaving the room open for these changes to also be brought in to more states, or even across the USA and the globe.
The proposed legislation targets situations such as the removal of Fortnite from the Apple App Store and the Google Play Store as a consequence of Epic introducing its own payment system. There is a definite payment monopoly on both the platforms and the platforms even made changes that make it harder to bypass the commission they charge on using the payment platforms. Apple did cut its commission rate to 15% for smaller developers, but developers on iOS are still stuck on the Apple App Store as the app distribution platform because of Apple’s walled garden approach to iOS. Android does have the ability to sideload, but the efforts to gain momentum on anything other than the Google Play Store are gargantuan, resigning developers to contend with the Play Store as their only practical means of success on the app distribution front. Many large developers even joined hands to form the “Coalition for App Fairness” non-profit to oppose Apple and Google. North Dakota’s proposed legislation seems like another falling domino that might just change how apps are distributed on smartphones in the future.
Update: Bill voted down
State senators of North Dakota have voted against the bill, 36 to 11 in favor (via NYTimes). The bill will consequently not materialize as a law in the state. The bill was being lobbied by the “Coalition for App Fairness” non-profit, and attention has now turned to other states like Arizona, Georgia, Massachusetts, Minnesota, and Wisconsin that are considering similar legislation.