Japan has joined the growing list of nations pushing for reforms in the mobile ecosystem.
The Japanese government recently held its seventh Digital Market Competition Conference, during which a ‘Competitive Evaluation of Mobile Ecosystems’ report was presented. This report highlighted the critical role mobile ecosystems play in today’s digital landscape and emphasised the need for more options and fair competition.
One of the key recommendations of the report is to require Apple and Google to allow third-party payment services to access their app stores. This would enable developers to offer users alternative payment options for their digital purchases.
Additionally, Japan is calling for an end to the preferential treatment of the tech giants’ own apps within their respective app stores. The report also suggests making it easier for users to remove pre-installed apps that come bundled with devices.
The primary goal of these reforms is to reduce the costs for Japanese consumers when purchasing apps. By fostering the growth of third-party app stores that charge lower fees compared to Apple’s up to 30 percent commission and Google’s variable rates, it is hoped that increased competition will drive down prices.
While Apple and Google argue that their fees cover the costs of maintaining and operating the app stores, regulators believe there is room for a significant reduction.
Japan is not the only country pursuing these reforms. South Korea has already taken steps in this direction, albeit with mixed results. The European Union, the United States, India, Australia, and several other nations are also eager to challenge the app store duopoly.
Epic Games, the creator of the popular game Fortnite, has been actively involved in legal battles against both Google and Apple, seeking to address the same issues.
However, Japan has shown some flexibility by suggesting that security arrangements should be met to satisfy Apple and Google.
This cautious approach raises concerns among Japanese consumers, as Apple has previously opposed similar arrangements in other regions, citing security risks associated with third-party access to its iOS App Store and payment processing systems. In contrast, Google has been more receptive to reform, given its existing policy of allowing third-party app stores on the Android platform.
The implementation of the report’s recommendations into legislation is expected to reach Japan’s parliament in 2024, which means it may take several years before any new regulations come into effect.
While these proposed changes hold the promise of a more competitive and consumer-friendly app store ecosystem, the road to achieving meaningful reform will likely be complex and require cooperation from all stakeholders involved.
(Photo by Jason Leung on Unsplash)
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