ACCC says regulation may be needed for app stores if changes not made

• The ACCC said regulation may be required to manage the market power held by Apple and Google’s app stores if changes are not made
• It argued that app developers should be allowed to offer alternative payment methods and that data collected by the tech giants should be kept separate from their other operations
• Apple and Google have both the ability and the incentive to promote their own apps over others, and have too much control over competitive terms
• The report is the second to be published under a five-year inquiry into markets for the supply of digital platform services in Australia and their impacts on competition and consumers
• A third report, focussing on Google’s rollout of search engine choice options on new Android devices in Europe, is due at the end of September

Regulation may be required to manage the significant market power held by Apple and Google’s app stores if changes are not made to address concerns, the Australian Competition and Consumer Commission (ACCC) said on Wednesday.

In a digital platforms services inquiry interim report, the competition watchdog said app developers should be allowed to provide customers with alternative payment methods and that data collected by the tech giants should be kept separate from their other operations.

The ACCC also called for consumers to be allowed to change or remove pre-installed or default apps.

“We have identified a number of areas where action is required and have put forward potential measures to address areas of particular concern,” said ACCC Chair Rod Sims.

“There is a window of opportunity for Apple and Google themselves to take steps to improve outcomes for app developers and consumers.”

Sims said that Apple and Google have both the ability and the incentive to promote their own apps over others, and control the terms to which their competitors must comply with in order to gain access to the stores.

He also argued that while Apple and Google have taken steps to remove malicious apps from their stores, more could be done to tackle those that feature subscription traps and other scams.

“The ACCC will also take into account significant proposals and law changes in other countries which have identified similar concerns,” Sims added.

“Regulation may be required if Apple and Google fail to take steps to address the concerns identified.”

The report is the second to be published under a five-year inquiry — directed by the Treasurer — into markets for the supply of digital platform services in Australia and their impacts on competition and consumers.

A third report, focusing on Google’s rollout of search engine choice options on new Android devices in Europe, is due at the end of September.