Australia’s competition watchdog is taking aim at the Google Play Store and Apple App Store as part of its five-year digital platform services inquiry.
The Australian Competition and Consumer Commission (ACCC) began its report into app marketplaces on Tuesday with a call for submissions from consumers and app developers about the nature of app stores.
“Apps have become essential tools for daily living for many Australian consumers, a trend that is likely to have increased during the COVID-19 pandemic,” ACCC Deputy Chair Delia Rickard said.
“Apps are, in turn, increasingly important for businesses as they promote, grow and run their enterprises.
“We want to know more about the market for mobile apps in Australia, including how transparent and effective the market is, for consumers as well as those operating in the market.
“We will also focus on the extent of competition between the major online app stores, and how they compete for app sales with other app providers.”
Apple and Google’s domination of mobile app stores has come under scrutiny recently following the rebellion of Fortnite developer Epic Games.
Last month, the US game developer launched a protest against 30 per cent taxes Google and Apple impose on in-app purchases, calling Apple a “behemoth seeking to control markets, block competition, and stifle innovation”.
The ACCC mentions the 30 per cent tax in its issues paper for app developers, saying it wants to know how those requirements affect developers’ ability to “compete with apps made by Google and Apple”.
Other issues concerning the ACCC are how apps are ranked, how consumer data is collected and used, and existing feedback systems for harmful apps.
“For app developers and suppliers, gaining a spot in one of the major app stores can result in significant sales, while failing to gain access can be a major setback,” Rickard said.
“We are keen to provide greater transparency on how this process works.
“We are also interested in how data is used and shared in the app ecosystem, including the data available to Google and Apple as a result of their control of the major app stores.”
The investigation is part of the ACCC’s five-year digital platform services inquiry which is due to be completed in 2025.
When the consumer watchdog hands down its initial report into app stores in March next year, it could result in recommendations to the government to address underlying issues with the app store marketplace.
Previously, the ACCC’s digital platforms inquiry pointed to tech giants like Facebook and Google exploiting a “distortionary” market imbalance in competition with Australian media and advertising companies.
That has since resulted in the development of a draft media bargaining code that would require Facebook and Google to pay for news content used and shared on their platforms.
Both companies have protested the upcoming regulation: Google threated that the laws “will hurt how Australians use Google Search and YouTube” and Facebook said it would skirt the laws by banning Australian users from posting news content.