A Bill in the Senate aimed at Apple and Google In-App Payments is Moving Forward

If passed, the Open App Markets Act would Compel Apple to allow iOS Sideloading.

A bill aimed at circumventing Apple and Google's app store rules has made progress. Only Senators John Cornyn and Thom Tillis voted against the Open App Markets Act, which passed the Senate Judiciary Committee 20-2. The vote demonstrated that the bill has bipartisan support once again.

If the bill passes as written, it will make it illegal for app marketplace owners with more than 50 million users in the United States to shut third-party developers out of their payment systems. The App Store and Google Play Store both pass this test since they require third-party apps to use their respective payment systems.

They'd have to allow developers contact their customers with "legitimate commercial offers, such as pricing terms and product or service offerings," and they wouldn't be able to prohibit or punish developers for providing apps at various prices on other platforms. Another clause would compel Apple and Google to allow customers to sideload or install software from third-party app stores. Because Android already enables side loading, this would have a greater impact on Apple.

Apple and Google have voiced their opposition to the plan, stating that it will threaten user security and privacy. They said the same thing about the American Innovation and Choice Online Act, a more comprehensive technology reform plan passed by the committee last month. Both legislation will be debated and voted on the Senate floor.

For both firms, the stakes are quite high. The App Store and Google Play Store each take a 15% cut of in-app purchases up to $1 million in yearly revenue for developers. After then, the fees increase to 30%.

Play Store revenue is included in Alphabet's "Google other revenues," which also includes hardware and non-ad earnings from YouTube. Last quarter, that business area raked in $8.2 billion, a 22 % rise year over year. The App Store is part of Apple's services business, which brought in $19.5 billion in the fourth quarter.

As a result of its legal struggle with Epic Games last year, Apple was compelled to allow developers to link consumers to other payment options. Before the amendment was intended to take effect, an appeals court judge allowed a last-minute stay.