Bill Overview
Title: Open App Markets Act
Description: This bill establishes rules related to the operation of an app store by a covered company (i.e., the owner or controller of an app store with more than 50 million U.S. users). An app is a software application or electronic service that may be run or directed by a user on a computer or mobile device. An app store is a publicly available website, software application, or other electronic service that distributes apps from third-party developers to users. The bill prohibits a covered company from (1) requiring developers to use an in-app payment system owned or controlled by the company as a condition of distribution or accessibility, (2) requiring that pricing or conditions of sale be equal to or more favorable on its app store than another app store, or (3) taking punitive action against a developer for using or offering different pricing terms or conditions of sale through another in-app payment system or on another app store. A covered company may not interfere with legitimate business communications between developers and users, use non-public business information from a third-party app to compete with the app, or unreasonably prefer or rank its own apps (or those of its business partners) over other apps. The bill provides for enforcement of its provisions by the Federal Trade Commission and the Department of Justice, as well as through suits brought by developers that are injured by reason of anything prohibited by this bill.
Sponsors: Sen. Blumenthal, Richard [D-CT]
Target Audience
Population: Global smartphone users and app developers
Estimated Size: 307000000
- App developers globally who develop apps for distribution worldwide may be affected as the app store rules change.
- The global population using smartphones, estimated at around 6 billion as of 2023, may also be indirectly impacted as the diversity of apps or their cost structure may change.
- The legislation applies to app stores with over 50 million U.S. users, affecting users globally if these stores operate internationally.
Reasoning
- The new policy directly targets large app stores, which implies a focus on major platforms like Apple's App Store or Google Play.
- Startups and small developers may experience increased competition and less restrictive distribution practices, which could improve their wellbeing by offering better market access.
- Consumers might see reduced app prices or more innovative apps emerging due to decreased fees and more flexibility for developers, thus potentially increasing their wellbeing.
- Larger developers might face increased competition but could benefit from fairer pricing structures, altering their wellbeing in complex ways.
- Not all smartphone users will notice immediate changes as the policy targets app store operations, affecting them indirectly through app availability and prices.
Simulated Interviews
Independent App Developer (California)
Age: 25 | Gender: female
Wellbeing Before Policy: 6
Duration of Impact: 20.0 years
Commonness: 5/20
Statement of Opinion:
- This policy will allow me to choose my own payment processors, which means I can negotiate better rates and potentially lower my app prices.
- Eliminating mandatory in-app payment systems reduces costs and helps avoid high commission fees on app stores.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 6 |
| Year 2 | 8 | 6 |
| Year 3 | 8 | 6 |
| Year 5 | 9 | 5 |
| Year 10 | 9 | 5 |
| Year 20 | 9 | 5 |
Tech Entrepreneur (New York)
Age: 34 | Gender: male
Wellbeing Before Policy: 5
Duration of Impact: 10.0 years
Commonness: 3/20
Statement of Opinion:
- It's about time smaller developers get a fair chance in the app distribution market. With this new policy, I hope my apps can compete more on merit rather than just marketing power.
- The restrictions against preferential treatment should help level the playing field.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 5 |
| Year 2 | 7 | 5 |
| Year 3 | 7 | 5 |
| Year 5 | 8 | 5 |
| Year 10 | 8 | 5 |
| Year 20 | 8 | 5 |
Software Engineer (Texas)
Age: 40 | Gender: female
Wellbeing Before Policy: 7
Duration of Impact: 5.0 years
Commonness: 4/20
Statement of Opinion:
- The policy might lead to increased competition, but also encourages innovation by opening more avenues to connect with users.
- My work might need adjustments to comply with new rules, but overall, it's positive.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 7 |
| Year 2 | 7 | 7 |
| Year 3 | 8 | 7 |
| Year 5 | 8 | 7 |
| Year 10 | 8 | 7 |
| Year 20 | 8 | 7 |
Mobile App User (Florida)
Age: 28 | Gender: male
Wellbeing Before Policy: 8
Duration of Impact: 5.0 years
Commonness: 10/20
Statement of Opinion:
- I think I might end up paying less for apps if developers are free to choose their own payment systems.
- Seeing a wider variety of apps would be great, especially if smaller developers can compete better.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 8 | 8 |
| Year 2 | 8 | 8 |
| Year 3 | 9 | 8 |
| Year 5 | 9 | 8 |
| Year 10 | 9 | 8 |
| Year 20 | 9 | 8 |
Policy Analyst (Washington)
Age: 45 | Gender: female
Wellbeing Before Policy: 6
Duration of Impact: 20.0 years
Commonness: 2/20
Statement of Opinion:
- The Open App Markets Act is a good starting point for deeper regulation of big tech companies, but enforcement will be key.
- It may encourage more fair competition in the long run.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 6 |
| Year 2 | 6 | 6 |
| Year 3 | 7 | 6 |
| Year 5 | 7 | 6 |
| Year 10 | 7 | 6 |
| Year 20 | 7 | 6 |
Tech Support Specialist (Illinois)
Age: 30 | Gender: male
Wellbeing Before Policy: 7
Duration of Impact: 10.0 years
Commonness: 6/20
Statement of Opinion:
- More flexibility for developers should mean fewer inquiries about app store payment issues, which might free up my time.
- It's a progressive change that many of our clients have been hoping for.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 7 |
| Year 2 | 8 | 7 |
| Year 3 | 9 | 7 |
| Year 5 | 9 | 7 |
| Year 10 | 9 | 7 |
| Year 20 | 8 | 7 |
College Student (Ohio)
Age: 22 | Gender: female
Wellbeing Before Policy: 7
Duration of Impact: 10.0 years
Commonness: 8/20
Statement of Opinion:
- It encourages new developers like me to enter the market without the fear of being overshadowed by larger players' preferential treatment.
- My chances of success in launching my own app might be higher.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 8 | 7 |
| Year 2 | 9 | 7 |
| Year 3 | 9 | 7 |
| Year 5 | 9 | 7 |
| Year 10 | 9 | 7 |
| Year 20 | 9 | 7 |
Business Owner (New Jersey)
Age: 50 | Gender: male
Wellbeing Before Policy: 6
Duration of Impact: 5.0 years
Commonness: 4/20
Statement of Opinion:
- The policy might lead to better options for app-based businesses like mine in terms of payment processing merchants.
- Local businesses could benefit from reduced in-app transaction costs.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 6 |
| Year 2 | 7 | 6 |
| Year 3 | 8 | 6 |
| Year 5 | 8 | 6 |
| Year 10 | 8 | 6 |
| Year 20 | 8 | 6 |
Retired (Arizona)
Age: 60 | Gender: female
Wellbeing Before Policy: 9
Duration of Impact: 10.0 years
Commonness: 12/20
Statement of Opinion:
- If the policy leads to more diverse apps, especially for wellness, it could be beneficial.
- Also, if apps become cheaper, that would be great.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 9 | 9 |
| Year 2 | 9 | 9 |
| Year 3 | 9 | 9 |
| Year 5 | 9 | 9 |
| Year 10 | 9 | 9 |
| Year 20 | 8 | 9 |
Large App Developer (Massachusetts)
Age: 38 | Gender: male
Wellbeing Before Policy: 8
Duration of Impact: 10.0 years
Commonness: 3/20
Statement of Opinion:
- I have mixed feelings about the policy; it creates more competition but also opens up new pricing strategies.
- We'll likely need to adjust our business model to align with new regulations.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 8 |
| Year 2 | 8 | 8 |
| Year 3 | 8 | 8 |
| Year 5 | 8 | 7 |
| Year 10 | 9 | 6 |
| Year 20 | 9 | 6 |
Cost Estimates
Year 1: $45000000 (Low: $35000000, High: $55000000)
Year 2: $48000000 (Low: $37000000, High: $59000000)
Year 3: $50000000 (Low: $39000000, High: $61000000)
Year 5: $55000000 (Low: $42000000, High: $66000000)
Year 10: $62000000 (Low: $48000000, High: $74000000)
Year 100: $0 (Low: $0, High: $0)
Key Considerations
- Monitoring and enforcement by the FTC and DOJ require significant resources, including funds, personnel, and technological capabilities.
- Increased legal actions and litigation could pose additional unforeseen fiscal challenges.
- Economic impacts are highly sensitive to how companies adapt to and implement policy changes.