WASHINGTON (AP) — The Biden administration is targeting Apple and Google for operating mobile app stores that it says stifle competition.
The finding is contained in a Commerce Department report released Wednesday by the administration as Chairman Joe Biden convenes his competition council for an update on efforts to promote competition and lower prices.
The department’s National Telecommunications and Information Administration report said the current app store model — dominated by Cupertino, Calif.-based Apple Inc. and Mountain View, Calif.-based Google LLC — is “bad for consumers.” and developers” by inflating prices and reducing innovation. Companies have a stranglehold on the market that stifles competition, he adds.
“The policies that Apple and Google have in place on their mobile app stores have created unnecessary barriers and costs for app developers, ranging from access fees to functional restrictions that favor some apps over others,” the report said. .
In an op-ed in the Wall Street Journal in January, Biden called on Democrats and Republicans to rein in big tech companies without mentioning Apple or Google by name.
“When tech platforms get big enough, many find ways to promote their products by excluding or disfavouring competitors, or they charge competitors a fortune to sell on their platform,” Biden said. “My vision for our economy is one where everyone – small and medium-sized businesses, family-owned shops, entrepreneurs – can compete on a level playing field with the bigger companies.”
A legal battle for app store dominance is already underway in the courts.
Apple has defended the area surrounding its iPhone app store, known as a walled garden, as a must-have feature appreciated by consumers who want the best protection available for their personal information. It said it faces significant competition from various alternatives to video games on its iPhones. And Google has long defended itself against monopoly claims.
The Commerce Department report says that “new laws and more antitrust action are likely needed” to increase competition in the app ecosystem.
Alan Davidson, the NTIA administrator, told reporters the report “identifies where legislation would be needed to address some of these issues.”
On another competitive front, the White House said the Consumer Financial Protection Bureau would move forward with a proposed rule to limit credit card late fees, which the bureau estimates would save consumers about 9 billions of dollars a year in late fees.
Rohit Chopra, director of the bureau, said the rule would reduce typical late fees from about $30 to $8 for missed payments and could go into effect as soon as 2024.
“Historically, credit card companies charge relatively small penalty amounts for missed payments, but once we discovered that these fees could be a source of easy profits, late fees have soared in the 2000s,” Chopra told ai. journalists. In recent years, these non-payment fees have ballooned to $41. These fees add up, with consumers hit with $12 billion a year in late fees on top of the billions of dollars in interest they’re paying.
The bureau is the nation’s financial watchdog agency created after the Great Recession.