Apple chief privacy engineer says proposed bill could "destroy iPhone as you know it"
A bill has been introduced in the North Dakota Senate that could ban app storefronts (via The Verge). That means Apple would have to remove the App Store from the iPhone, the iPad, the Apple Watch and the iPod Touch. The bill, number 2333, seeks to remove those app stores like Apple's App Store that demand developers use only their in-app payment platform. It also prevents companies like Apple and Google from retaliating against developers who choose to offer their wares through a different means of distribution or use a different payment system.
A North Dakota bill "threatens to destroy iPhone as you know it"
This is the issue at the heart of the battle between Fortnite developer Epic Games and Apple. Seeking to avoid paying Apple its 30% cut of in-app purchases in the App Store, Epic gave Fortnite users the option of using its own payment platform for in-app purchases. Apple responded by kicking Fortnite out of the App Store.
A bill proposed in North Dakota could force Apple to remove the App Store from its devices in that state
State Sen. Kyle Davison (R-Fargo) introduced the bill Tuesday before a Senate committee. During a press conference, Sen. Davison said, "The purpose of the bill is to level the playing field for app developers in North Dakota and protect customers from devastating, monopolistic fees imposed by big tech companies. said Sen. Kyle Davison (R-Fargo), who introduced the bill before a Senate committee on Tuesday. Davison believes that the 30% cut of in-app revenue garnered by Apple and Google ends up "raising prices and limiting choices for consumers."
The bill requires that any "digital application distribution platform" taking in more than $10 million a year in revenue will need to adhere to certain restrictions. For example, if the bill becomes state law, in North Dakota Apple would have to allow users to sideload apps from a third-party app store some thing that the tech giant currently does not allow. We should point out that while Google also takes a 30% cut of in-app revenue generated from the Play Store, Android does allow users to sideload apps from third-party app stores such as the one owned by Amazon.
Not only is North Dakota looking to punish Apple by passing legislation, the U.S. Congress is considering an investigation of Apple; in Europe there are two active antitrust investigations looking at the App Store and Apple Pay. U.S. Representative David Cicilline (D-RI) accused Apple of committing "highway robbery" on a podcast. Rep. Ciclline said, "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. 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. 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. 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." The bill in North Dakota would also allow an iOS version of Fortnite to process in-app payments through Epic's own payment platform.
Apple already testified against the bill on Tuesday in a hearing with North Dakota's Senate Industry, Business and Labor Committee. Apple's chief privacy engineer, Erik Neuenschwander, told the committee that the bill "threatens to destroy iPhone as you know it." The law would "undermine the privacy, security, safety, and performance that’s built into iPhone by design. Simply put, we work hard to keep bad apps out of the App Store; (the bill) could require us to let them in."
Keep in mind that this is a state bill and its impact would only be felt inside North Dakota. However, in the current environment, more states could attempt to follow along.
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