ACCC steps into Google, Apple apps fight with new competition probe

An escalating fight between the tech giants and app developers has spilt over from the US into Australia, prompting a new ACCC probe.

The ACCC will investigate competition issues surrounding Google and Apple’s app stores. Picture: AFP

An escalating fight between the tech giants and app developers has spilt over from the US into Australia, with Australia’s competition watchdog announcing it is investigating competition in the mobile app market as part of its five-year project on digital platforms.

In a statement, the ACCC said it would examine issues including data use and the sharing of data between apps, the state of competition between Google and Apple’s rival app stores, and “whether more pricing transparency is needed in Australia’s mobile apps market”.

The development comes amid a bruising battle in the US between Apple and Fortnite developer Epic Games, which has been banned from Apple’s app store for breaching its terms. Epic claims Apple’s 30 per cent cut of all transactions is unfair, while Apple says the fee is necessary for it to be able to provide the App Store to users.

A number of app developers, including videostreaming company Netflix, dating app provider Match Group and music-streaming service Spotify, have challenged or publicly complained about the 30 per cent commission.

Facebook has said that Apple’s 30 per cent cut makes it harder for small businesses that are having to shift certain operations online.

“Apps have become essential tools for daily living for many Australian consumers, a trend that is likely to have increased during the COVID-19 pandemic. Apps are, in turn, increasingly important for businesses as they promote, grow and run their enterprises,” ACCC deputy chair Delia Rickard said.

“We want to know more about the market for mobile apps in Australia, including how transparent and effective the market is, for consumers as well as those operating in the market. We will also focus on the extent of competition between the major online app stores, and how they compete for app sales with other app providers,”

Millions of apps are available for download by Australian consumers for use on mobile devices like phones, tablets and smart watches, and they span a wide range of functions including games, entertainment, health and fitness, education and the delivery of goods, such as food, and services, such as banking.

“For app developers and suppliers, gaining a spot in one of the major app stores can result in significant sales, while failing to gain access can be a major setback. We are keen to provide greater transparency on how this process works,” Ms Rickard said.

“We are also interested in how data is used and shared in the app ecosystem, including the data available to Google and Apple as a result of their control of the major app stores.”

Apple and Google were contacted for comment.

The digital platforms inquiry was the basis for the industry code governing compensation for media companies for content the platforms use.