Apple and Google were attacked over anti-competitive behavior related to their app stores

At the antitrust hearing held by the US Senate on April 21, the influence of the two technology giants, Apple and Google, on their smartphone ecosystem became the focus of the meeting.

In addition to the concerns of members of Congress, Apple and Google also faced a series of accusations in the hearings from well-known app developers including streaming music platform Spotify and online dating site Tinder. They accused large technology platforms of improper use of dominance and sabotage.

According to the report, during a lengthy Senate hearing, app developers stated that Apple and Google’s regulations on in-app payments and app upgrades allow tech giants to stifle rival services and retaliate when developers refuse to comply.

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Most of the complaints from app developers are directed at Apple because Apple’s closed ecosystem prohibits apps on iOS from being installed anywhere outside of the Apple App Store; a small number are directed at Google, mainly focusing on its search and advertising business.

The tense hearing also highlighted how the anti-monopoly review against Apple has been strengthened over the past year or so after a series of concerns by antitrust regulators on Apple, Google, Amazon, Facebook and other technology giants. Legislators are very clear that this hearing will become a springboard for legislation to restrict large-scale technology platforms.

At the hearing, participants criticized Apple for withdrawing a 30% commission for in-app purchases of digital goods and services. Apple argued that the fee is to ensure the security of the iOS ecosystem and make users trustworthy.

Jared Sine, chief legal officer of Match Group, Tinder’s parent company, said that app store fees have now become the company’s largest expenditure, up to $500 million per year. For example, if a user purchases a premium membership through Tinder’s iOS app, 30% of the fee goes to Apple.

“This $500 million could have been given back to users, or used to increase hires and invest in new innovations,” Sine said. Horacio Gutierrez, Spotify’s chief legal officer, said that companies that try to bypass Apple’s in-app purchases (such as allowing users to pay directly on the website) and find alternative solutions will soon find themselves in a disadvantaged position of Apple.

“We can’t even send emails to users to tell them how to upgrade,” Gutierrez said that sending emails does not involve payment to Apple. He called Apple’s contract restrictions a “ban.”

App developers also expressed concerns about retaliation for bypassing the tech giants. Sine testified that on the eve of the hearing, Google had contacted the Match Group to ask for an explanation of their testimony.

Senator Richard Blumenthal called the actions of Apple and Google “obviously unforgivable.” After listening to Sine’s testimony, he told Senator Amy Klobuchar, chairman of the subcommittee, that he believed that Google’s move was a threat and should be investigated by the Senate. Klobuchar said there will be this plan.

In response to this, Wilson White, Google’s senior director of public policy, said that he did not agree with Sine’s description of the phone: “I don’t think this is a threat. We will never threaten our partners.”

Spotify accused Apple of improper retaliation, saying that Spotify was rejected from the App Store for criticizing Apple. To this, Apple cited Spotify’s huge commercial success to oppose it. “We have been supporting these businesses without any evidence of retaliation,” said Kyle Andeer, Apple’s chief compliance officer.

Andeer also defended Apple’s 30% commission structure, saying that the company chose to use these fees for digital products and services from the beginning, and most application developers paid nothing.

But Senator Mike Lee challenged Apple, asking them to explain why certain services, such as ride-hailing platform Uber, can be excluded from commission requirements, while online dating sites like Tinder are still subject to this.

Apple tried to explain the difference to Lee, saying that Uber does not provide digital goods or services because it involves consumers asking drivers to carry out physical transportation. In contrast, whether it is online dating or buying e-books, “all the experience is on the device. On the screen.”

This explanation seems to be unreasonable to Lee and Sine, because they believe that app store operators such as Apple and Google “have essentially acquired the Internet and transferred it to the app store.”

“They have built the entrance, built the toll station, as long as you are a digital product and service, you have to pay to pass,” Sine said, “They let other people enter the highway for free, and what we want to say is, Why isn’t the highway the same for everyone?”