WASHINGTON: The Biden administration is taking aim at Apple and Google for operating mobile app stores that it says stifle competition.
The finding is contained in a Commerce Department report being released by the administration on Wednesday as President Joe Biden convenes his competition council for an update on efforts to promote competition and lower prices.
The report from the department’s National Telecommunications and Information Administration says the current app store model — dominated by Cupertino, California-based Apple Inc. and Mountain View, California-based Google LLC — is “harmful to consumers and developers” by inflating prices and reducing innovation. The firms have a stranglehold on the market that squelches competition, it adds.
“The policies that Apple and Google have in place in their own mobile app stores have created unnecessary barriers and costs for app developers, ranging from fees for access to functional restrictions that favor some apps over others” the report said.
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In an op-ed in The Wall Street Journal in January, Biden called on Democrats and Republicans to rein in large tech firms without mentioning Apple or Google by name.
“When tech platforms get big enough, many find ways to promote their own products while excluding or disadvantaging competitors — or charge competitors a fortune to sell on their platform,” Biden said. “My vision for our economy is one in which everyone — small and midsized businesses, mom-and-pop shops, entrepreneurs — can compete on a level playing field with the biggest companies.”
A legal battle over app store dominance is already playing out in the courts.
Apple has defended the area surrounding its iPhone app store, known as a walled garden, as an indispensable feature prized by consumers who want the best protection available for their personal information. It has said it faces significant competition from various alternatives to video games on its iPhones. And Google has long defended itself against claims of monopoly.
The Commerce Department report said “new legislation and additional antitrust enforcement actions are likely necessary” to boost competition in the app ecosystem.
