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Who wins when governments go head-to-head with technology giants — and whom should we root for?
We’re getting a small test of that question in the Netherlands. The Dutch equivalent to the U.S. Federal Trade Commission required Apple to offer multiple payment options to users of dating apps on their phones last ye. It was a small crack in Apple’s absolute control over iPhone apps from 2008.
This has now become a standoff between the world’s most valuable company and Dutch bureaucrats. Apple has proposed a workaround, but the regulator calls Apple’s attitude “regrettable” and has issued weekly fines totaling 25 million euros (about $28 million). Apple says that iPhone owners’ security and convenience would be compromised if it allowed this, but also says that the company is complying with its legal obligations.
I wouldn’t normally pay attention to a relatively minor regulatory beef, but the company is fighting as if it’s a big deal. Apple’s response is also revealing about how tech superpowers react to governments’ efforts to alter the role of technologies.
More authorities everywhere in the world — in both democratic and authoritarian countries — want to make tech companies change what they’re doing. Tech giants often claim that they adhere to the laws in every country where they operate. However, they are also known to push back against governments and modify or deflect laws and regulations. And it’s not always easy to tell the difference between righteous defiance and corporate impunity.
Democrats have criticised Facebook, Twitter and Google for not doing more in opposition to government attempts to censor political speech countries like Russia, India, Vietnam, and Russia. After mass shootings at San Bernardino, Calif. in 2015, and Pensacola, Fla. in 2020, internet evangelists applauded Apple for refusing help from the F.B.I. break into the killers’ iPhones.
The Netherlands became an unlikely high-stakes tech battleground starting in 2019, when the Authority for Consumers and Markets began investigating whether Apple’s app storefront broke the country’s laws against abuses of power.
This is the same issue that Apple faces from Fargo, N.D. to Seoul, and many other world capitals and courts. Apple demands that iPhone apps are downloaded through its app store, according to developers and authorities. The company decides what content is appropriate and receives a 30% commission on certain purchases.
Match Group, an American company that owns Tinder, Match.com, and other dating services, used the Dutch investigation in order to air their grievances regarding Apple. Match wanted more options that go around Apple’s store to direct people to pay for dating services.
The A.C.M. issued an order in August that prohibited Apple from requiring dating apps to use only the company’s payment system. issued an order that prohibited Apple from requiring dating apps to use only the company’s payment system, which enables Apple to collect a fee. It might not look like much, but the Netherlands could be one of the first dominoes in loosening Apple’s grip on the app economy.
Apple proposed conditions last month to counter the Dutch regulator. Apple stated that dating apps could use any payment system in the country, but that Apple would collect 27 cents for each dollar that users make in the app. Apple also required that the dating companies give information and be audited.
Try to imagine if Walmart said that shoppers could pay any way they wanted, but that it might cost more if you used a non-Walmart credit card and you had to give Walmart your card’s monthly statement.
People who keep close tabs on Apple have said that its approach in the Netherlands is probably a blueprint for other cases in which judges or regulators try to force the company to do things it doesn’t want to do with its app store.
The regulator says that Apple’s new conditions don’t comply with the A.C.M. order. “Apple’s so-called ‘solutions’ continue to create too many barriers for dating-app providers that wish to use their own payment systems,” a spokesman for the A.C.M. Monday’s statement contained the following:
The dispute with Apple will likely be resolved by a Dutch court. Regulating tech companies with large pockets is difficult and slow. This dispute shows that it’s even more complicated. The question now is whether Apple will fight current and future attempts to change its app store with the vigor it has in the Netherlands — and whether we’ll be better or worse off if it does.
Before we go …
- The future of work in physical offices remains uncertain, but Tech companies are on a rampage of office expansion, my colleague Kellen Browning writes. One reason is that tech superpowers have so many dollars. What’s a few more gleaming glass office towers?
- A new twist on financial frauds combines the “The old romance lure is rekindled by the newer temptation of instant cryptocurrency riches,” Kevin Roose explains.
- Why are we still receiving robocalls ?!?! (insert SCREAMS): The technologies and laws that made phone calls and text messages cheap in the U.S. also made it extremely difficult to end those unwanted automated phone calls and spam texts,Vox’s Recode publication reports. It offers some helpful suggestions to help you protect yourself against robocalls.
This is a huge accomplishment
Hank the Tank, a 500-pound bear that I am obsessed with, is my obsession.