Open App Markets Act Undermines Innovation and Competition, Says ITIF
WASHINGTON—Following the Senate Judiciary Committee advancing its second tech competition bill of the year, the Open App Markets Act, forcing large technology platforms to give up quality and payment control on their app stores and allow consumers to download apps from third-party sources, the Information Technology and Innovation Foundation (ITIF), the leading think tank for science and technology policy, issued the following statement from Aurelien Portuese, ITIF’s director of the Schumpeter Project on Competition Policy:
The bill wrongly assumes the app economy is not competitive enough and that app stores are too selective.
Contrary to its objectives, the bill will not increase competition and innovation. It will just force app-store owners to accept a higher number of apps without the proper quality checks. This can generate new cybersecurity and liability concerns for both platforms and app developers. Policymakers should be less concerned about the number of apps on the app stores and more focused on the quality of such apps. Decreasing quality controls on the app stores does not lead to more innovative products, but more faulty applications that are no longer be filtered out.
Ironically, this bill will not favor small entrepreneurs, but support large app companies such as Epic Games or Spotify, who will not need to give up a share of their in-app payments to the app stores. This, in turn, undermines platforms’ intellectual property rights. In addition, by giving in to a few vocal app companies, Congress is now opening doors to foreign app developers who have the space to grow and ultimately undermine American competitiveness.
For more on the issue, please see:
- Aurelien Portuese, “Open Letter to the Senate Judiciary Committee Regarding the ‘Open App Markets Act’” (ITIF, 2022).
- Daniel Castro, “Banning ‘Closed’ Mobile Ecosystems Would Hurt Consumer Choice and Competition” (ITIF, 2022).
- Aurelien Portuese, “Is Congress Committed to Making American Lives Costlier?” (ITIF, 2022)
###
The Information Technology and Innovation Foundation (ITIF) is an independent, nonprofit, nonpartisan research and educational institute focusing on the intersection of technological innovation and public policy. Recognized by its peers in the think tank community as the global center of excellence for science and technology policy, ITIF’s mission is to formulate and promote policy solutions that accelerate innovation and boost productivity to spur growth, opportunity, and progress.
