Arizona Bill on App Store Payments
Regina Cobb and Leo Biasiucci:
The status quo is failing Arizonans, forcing us to pay inflated prices. It’s failing entrepreneurs, who are being forced to jump through hoops simply to get products to their customers. In fact, the only folks who seem to benefit from this setup are the monopolies – Apple and Google.
But we’re ready to change that – and Arizona is leading the charge. While D.C. sits on its hands, we are taking action now to challenge Big Tech’s monopoly and make Arizona a better place for every app user and app developer. We are fighting for HB2005, a bill to lower prices for consumers and free small businesses from Big Tech’s “app tax.” The legislation would allow web developers to accept payments for their apps without going through Apple or Google’s app stores, bypassing the app tax and reducing the cost for consumers without compromising security or safety.
This is a more narrow bill than what was first proposed in North Dakota. It focuses exclusively on giving all developers the same kind of freedom in payment processing that Uber, Lyft, Amazon, and other physical goods apps already enjoy.
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The hearing before the vote is being broadcast live on the Arizona State Legislature site.
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“We we introduced the App Store in 2008, developers had to pay for the tools to build, they had to pay for their discs.” LOL. Like the internet didn’t exist in 2008? Sheesh.
“Apple: Developers had to pay 70% before the App Store was invented”, this is just terrible, horrible misinformation. Ugh. Sad to hear Apple advance this.
Apple doesn’t have the information on how much money they’ve made from the IAP cut!
From kagi.com’s 1997 web site Kagi’s fees in 1997 were ~12%! More than a decade before the App Store. What a bunch of lying liars!
Previously:
Update (2021-03-02): Juli Clover:
A Minnesota bill shared by Star Tribune would force Apple and Google to keep products from Minnesotan developers on their app stores even if those developers sell them directly or through other channels, skirting current in-app purchase rules.
For state legislatures, the in-app payment part is particularly intriguing because lawmakers can directly benefit consumers in their states and, potentially, attract app development companies.
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Of the three bills I’ve seen so far (Arizona, Minnesota, and North Dakota), my personal favorite is the language of the Grand Canyon State’s version of the bill, which would make it illegal for Apple and Google to “require a developer that is domiciled in this state to use a particular in-application payment system as the exclusive mode of accepting payments from a user to download a software application or purchase a digital or physical product or service through a software application” (emphasis added). As Apple and Google are based in California, not Arizona, the argument is apparently made by the bill’s opponents that this is interstate commerce and Arizona is just trying to favor its own companies, but again, the vote on constitutionality was unanimous and in favor of this proposal.
As outlined by Protocol, Apple has been working against the bill since last month. Apple lobbyist Rob Didiron began fighting the legislation before it had been formally introduced, with Apple also hiring additional lobbyists and sending lawyers to Arizona.
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In a hearing last week, Apple’s chief compliance officer Kyle Andeer called HB2005 a “government mandate that Apple give away the App Store.”
Update (2021-03-11): Juli Clover:
The Arizona House of Representatives today passed HB2005, a state bill that would provide developers with an alternative to Google and Apple’s in-app purchase options by allowing developers to use their own payment solutions within apps.
Matt Stoller (via David Heinemeier Hansson):
All but one Republicans voted for it and all but one Democrat voted against it. It’s too soon to declare app store monopolies over. The bill isn’t law, it has to pass both houses and be signed by the Governor first (and Apple has hired the former chief of staff to the Governor to lobby against it). it will now head to the state Senate, and potentially the Governor.
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My guess is that this bill will become law somewhere, with enforcement conflicts to follow. Apple and Google will kick and scream, but as with Facebook and Australia, they will eventually fold.
A couple of proposed amendments failed, while a proposal by Dr. Cobb (enabling app developers to complain to Arizona’s Attorney General about any failure by Apple or Google to comply) was adopted.
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This remains interesting, and meanwhile there are initiatives in various other states. Today, the Minnesota Reformer website published an opinion piece by Justin Stofferahn and Pat Garofalo, calling on the Minnesota state legislature to “curb anti-competitive tactics” in order to become, once again, “an innovation center.”
On the other side of the Big Pond, Apple’s purely pretextual defenses of its app store monopoly are falling apart. There were not one, not two, but three news cycles this week, two of which are bad news for Apple and the third is more likely than not to portend another decision against Apple[…]
Update (2021-04-16): Nick Statt:
The Arizona State Senate was scheduled to vote on an unprecedented and controversial bill Wednesday that would have imposed far-reaching changes on how Apple and Google operate their respective mobile app stores, specifically by allowing alternative in-app payment systems. But the vote never happened, having been passed over on the schedule without explanation.
Arizona’s proposed state bill “HB2005", that would provide developers with an alternative to Google and Apple’s in-app purchase options by allowing developers to use their own payment solutions within apps, appears to have been abandoned after intense lobbying (via The Verge).
1 Comment RSS · Twitter
This is great. I hope more states do this.
I'm not normally a government regulation person, but Apple's stance on this is entirely customer hostile. There is no reason I can't buy books in the Kindle app because Apple wants their cut. It drives me bonkers.
