The Australian Competition and Consumer Commission (ACCC) today announced an investigation into the operation of app marketplaces in Australia, citing concerns around competition and consumer protections.
Google and Apple dominate app marketplaces. The former is currently engaging in a separate ugly stoush with the ACCC over the regulator’s plan to make it pay news publishers for use of their content, while the latter is under mounting scrutiny globally for its app revenue sharing requirements.
There are millions of apps available to download from Apple’s App Store or Google’s Play Store, with hundreds more published each day.
According to research from Sensor Tower, last year the two stores clocked nearly 115 billion app downloads globally. 2019 app store revenue for Apple was $US54 billion while Google pulled in $US29 billion.
Apple is already locked in a legal battle with Epic Games, developer of the popular game Fortnite, over Epic’s attempt to bypass Apple’s fee collection with its own in-app purchases for the game. Unhappy it could no longer take its usual 30 per cent cut, Apple removed Fortnite from its store. Fee policies are one area the Australian regulator will investigate in the probe launched today.
Mapping the marketplace
In an issues paper, the ACCC states it will look at the US tech giants’ practices in Australia, including their attempts to link or bundle their other goods and services with their app marketplaces; their effect on competition throughout the supply chain; terms and conditions for using app marketplaces; fee structures; rules; marketplace rankings; the collection and use of consumer data by marketplaces including users’ understanding of it; and whether consumer protection measures against harmful apps are working.
According to the regulator, the report’s findings may be used to recommend legislative changes and potentially ACCC action under competition and consumer laws.
The report is the second in a series of inquiries making up a five-year-long investigation into markets for the supply of digital platform services — a directive from the Coalition Government following the ACCC’s landmark Digital Platform Inquiry, which uncovered systematic problems in the operation of digital platforms.
Submissions are open until 2 October, with a final report to be delivered to government by the end of March next year.