As Apple faces an avalanche of pressure amid accusations of antitrust and anti-competitive behavior, a prominent US lawmaker is speaking out against the company’s App Store policy. In an interview with The Verge Representative David Cicilline who is the Chairman of the US House Judiciary Committee says that Apple’s App Store is “highway robbery.”
“Because of the market power that Apple has, it is charging exorbitant rents — highway robbery, basically — bullying people to pay 30 percent or denying access to their market,” said Rep. Cicilline. “It’s crushing small developers who simply can’t survive with those kinds of payments. If there were real competition in this marketplace, this wouldn’t happen.”
This week Apple told the developers of the email app Hey, that if it doesn’t switch to the company’s in-app purchasing system which gives it 30% commission for purchases made in the app, it wouldn’t be added back to the store. Since then, the Silicon Valley tech-giant has faced more pressure to alter its rules amid newly announced investigations by the European Commission.
“Many people have come forward to share their experiences, who are terrified of economic retaliation, who are afraid they can’t survive the economic retaliation that these large platforms can impose because of the power that they have, and we intend to pursue those allegations very seriously,” said Rep. Cicilline. “This is a real problem in the marketplace. This is a direct consequence of enormous market power, the fact that Apple is the gatekeeper for these developers, and we have heard many, many examples.”
“No one has a choice,” added Heinemeier Hansson. “Everyone is petrified… and then I understood. If you’re a publicly traded company, you cannot afford this. You cannot afford to file your earnings and say, ‘Oh, we just lost 50 percent of revenue last quarter because we had a spat with Apple.’ And if you’re a small developer, you can’t afford this literally because you will go broke — you will lose your house if they kick you out of the App Store.”
The US Judiciary Committee, lead by Cicilline has called upon Tim Cook and the CEOs of Facebook, Google, and Amazon to testify in hearings set for July. Apple has signaled its willingness to send a Senior Executive to get grilled by lawmakers but does not say it will be Mr. Cook himself.
Just today it was revealed by The New York Times that Apple has rejected Facebook’s gaming app for at least the 5th time. Apple notes violation of App Store policy as the reason for rejection, however, people familiar with the matter say its more likey a strategic move to limit competition for Apple Arcade.
This week Apple proudly touted its support for an independent study that highlighted the economic benefits that the App Store provides. According to the company-backed report, the App Store “facilitated half a trillion dollars” of trade in 2019. The announcement itself was an attempt to highlight the App Store’s success as calls for change grow louder and louder.