Recording of the Senate Judiciary subcommittee hearing to examine competition in app stores, with testimony from Apple, Google, Spotify, Tile, and others

Subcommittee on Competition Policy, Antitrust, and Consumer Rights. Mr. Kyle Andeer Chief Compliance Officer Apple Cupertino …

Senate Judiciary Subcommittee 2021-04-22

Context & Ripple Effects

The hearing follows earlier congressional scrutiny in which Tile accused Apple of anticompetitive conduct, while other device and app companies raised parallel complaints about major platforms. Apple had already agreed to make Chief Compliance Officer Kyle Andeer available for the hearing, signaling that app-store oversight had moved from broad platform criticism to named testimony.

The same day, Spotify and Match characterized Apple’s treatment of developers as an abuse of platform power in Senate hearing testimony. The recording makes those claims and the responses from Apple, Google, Tile, and other witnesses part of the subcommittee’s accessible record.

First-order effects

The Senate Judiciary subcommittee obtains a public record of testimony from Apple, Google, Spotify, Tile, and other participants on app-store competition.
Apple and Google must defend their app-store practices alongside developers and hardware companies whose complaints had already reached Congress, including Tile’s prior allegations against Apple.

Second-order effects

Spotify, Tile, and similarly situated developers gain a formal venue to align their concerns about platform access and competition with the subcommittee’s ongoing oversight.
The hearing concentrates congressional attention on the rules through which Apple and Google govern app distribution, increasing the relevance of their policies to future antitrust scrutiny.

Third-order effects

If repeated hearings continue to build a shared factual record from platforms and their business users, app-store governance is likely to become a more durable antitrust category rather than a subset of broader Big Tech criticism.
The structure of platform oversight shifts toward examining gatekeeper rules and developer dependence, with testimony from affected companies shaping how lawmakers frame competition concerns.

The trend: Congressional antitrust oversight is narrowing from general platform dominance toward the operational rules that govern access to major app stores.

Discussion

@gartenberg Michael Gartenberg on x
I believe @keleftheriou has brought an important issue about the App Store to a mainstream audience. I hope Apple gets its act together soon. The ecosystem that is often praised is breaking at the seams IMHO
@issielapowsky Issie Lapowsky on x
Match's Sine is spilling tea on a call from Google last night. “They called us last night after our testimony became public to ask us why our testimony was different than what we'd said about the situation in our earnings call earlier this year.”
@jacknicas Jack Nicas on x
The Senate is holding a hearing right now on Apple and Google's power over apps. Apple's Kyle Andeer just gave some misleading testimony. He said Apple's commission is “almost always” 15% — not 30%. Yet: 95% of Apple's app revenue comes from developers that pay the 30% rate.
@kantrowitz Alex Kantrowitz on x
Now, Tile general counsel Kirsten Daru is up. And she picks right up where Spotify left off. She says Apple restricted technology that Tile wanted to use, then used that exact technology for itself.
@matthewstoller Matt Stoller on x
Senator Cantwell asks Lina Khan about the collapse of local news in the face of Google and Facebook. Khan responds by saying there are dominant gatekeepers, and that there are problems - “potential criminal activity” - in adtech.
@keleftheriou Kosta Eleftheriou on x
Senator @ossoff with some excellent questioning on the new App Store scam findings: “Apple is making a cut on those abusive billing practices, are you not?” “Does Apple refund all of Apple's revenues derived from those scam billing practices?” Apple: maybe, I think? 😅🤷‍♂ ️ https:…
@jacknicas Jack Nicas on x
And here's a holy-shit stat: Match Group said app store fees are its single largest expense and will soon exceed $500 million a year. That's about a fifth of its total sales.
@dhh @dhh on x
“As Apple faces down hearings in Congress and lawsuits in court, its argument that it needs to maintain total control over the iPhone app ecosystem to keep users safe doesn't mesh with the obvious examples of grift that anyone can easily find.” 🎯☠️ https://www.theverge.com/...
@cat_zakrzewski Cat Zakrzewski on x
Exclusive: Tile says since it brought its concerns about Apple's anticompetitive behavior before Congress more than a year ago, they've only gotten worse. Here's what to expect when the company testifies later today: https://www.washingtonpost.com/ ...
@keleftheriou Kosta Eleftheriou on x
“It's trivially easy to find apps [...] which are scams, which are promoted by, in some cases, 100s or 1000s of obviously fake positive reviews” “Why do we rely upon open-source reporting and journalists to find all of these apps that are trivially easy to identify as scams?” 🔥 h…
@issielapowsky Issie Lapowsky on x
Klobuchar has used her time very effectively to help the witnesses lay out their case against (mostly) Apple.
@jacknicas Jack Nicas on x
Tile said Apple boxed it out and copied its products. Spotify said Apple blocked it from saying customers could find cheaper prices outside its iPhone app. And Match said that it now paid Apple & Google nearly $500M a year, its single largest expense. https://www.nytimes.com/...
@starfire2258 Sean Hollister on x
Apple is about to argue before the Senate that the App Store isn't a monopoly, and that Apple is right to extract a 30 percent cut. Here are 2,500 words from me about one specific way Apple is repeatedly falling down on the job: blatantly obvious scams. https://www.theverge.com/.…
@kantrowitz Alex Kantrowitz on x
Pretty wild how bipartisan the senate's hearing on app store competitiveness is. Marsha Blackburn is piggybacking off Jon Ossoff's questioning to hammer Google and Apple on abusing their power.
@dsilverman Dwight Silverman on x
Apparently Kyle Andeer, Apple's Chief Compliance Officer now testifying in the App Store hearing, hasn't gotten the word about the scam apps being uncovered almost daily. https://www.theverge.com/...
@jacknicas Jack Nicas on x
To be sure: 98% of apps that pay a commission are subject to the lower rate. But nearly all of the money Apple earns on the app store comes from larger companies paying the higher rate.
@pwnallthethings @pwnallthethings on x
And spare me the “but we put so much money into developer tools”. iOS developer tools *suck*. Xcode is actual garbage compared with equiv tools on other platforms (like Visual Studio), and you already pay $99/yr for a dev cert for the “privilege” of being an iOS developer.
@iansherr Ian Sherr on x
Spotify says there was a time that it was forced to use Apple's commission pricing. And as a result, it raised prices from $9.99 to $12.99 per month. Then a few months after the price change, Apple introduced Apple Music for $9.99 per month. “We had no choice to take the IAP out”
@pwnallthethings @pwnallthethings on x
The bit that truly gets me tho is the idea that app stores are entitled to post-initial-sale sales that don't even involve the appstore. Just imagine how absurd that logic would sound if applied to other industries
@issielapowsky Issie Lapowsky on x
Despite the Parler outrage in his opening, Mike Lee is asking some substantive questions so far, too, on pricing. He asked why Uber doesn't have to pay a fee but Match does. Apple and Google both said it's because Uber is not delivering a digital good. But but but...
@pwnallthethings @pwnallthethings on x
“Thanks for getting internet provided through Comcast. It costs $300 for a router, $60/mo thereafter, oh, and also every time you make an internet purchase you have to hand over 30% to us. Because we provide the Internet platform”
@dhh @dhh on x
Just the sheer fact that Apple is AN ACCOMPLISH to these scams should be scaring the bejesus out of their risk managers. They've collected millions in fraudulent fees from approving scam apps that use their payment processing system to rob people. (Do Apple have risk managers?)
@matthewstoller Matt Stoller on x
And now @ossoff is bringing the 🔥🔥🔥 on why it's trivially easy to get fraudulent apps onto the Apple app store. @keleftheriou https://t.co/LZSf6v404H
@kellymakena Makena Kelly on x
Apple on Tile/Airtags: We did not copy Tile's product. We did not copy Tile's application. I think, if you look at the Airtags that will be released tomorrow, if you look at the Find My application, you'll see this is a very different product."
@ddayen David Dayen on x
This app store hearing is interesting. Sen. Ossoff just blew up the entire concept of a restricted app store as a safety and security measure, when they're crawling with scam artists and fraudsters https://www.judiciary.senate.gov/ ...
@patrickmcgee_ Patrick McGee on x
Match says Apple constantly lets underage users join the Match apps for 18+ years users. Apple knows their age, from user ID, but still lets them download the dating apps. Match has asked them to stop. Instead the onus is on Match.
@jacknicas Jack Nicas on x
Apple's Kyle Andeer: “We do not favor ourselves in search.” The New York Times: “If you searched for ‘podcast’ in May 2018, you would have had to scroll through as many as 14 Apple apps before finding one made by another publisher.” https://www.nytimes.com/...
@b_fung Brian Fung on x
Tile's Kirsten Daru went after Apple's just-announced AirTag device, complaining that Apple has rebuffed Tile's requests to access the same ultra-wideband wireless chip in Apple devices used by AirTag “because Apple has decided to reserve its use exclusively in its product.”
@kantrowitz Alex Kantrowitz on x
Spotify chief legal officer Horacio Gutierrez is reaming into Apple in the Senate's hearing on app store competition. Gloves are off.
@thesullivan Mr. Sullivan on x
I'm going to say it. This is going badly for Apple. https://www.judiciary.senate.gov/ ...
@kantrowitz Alex Kantrowitz on x
As he testifies, Spotify's Gutierrez says Apple's app store policies are an “abusive power grab and a confiscation of value created by others.”
@pwnallthethings @pwnallthethings on x
“Thanks for buying our new Toyota car platform. Our cars run on normal gas, but to fill it up at any gas station you must sign up for an account, enroll your credit card into our app, and pay via us for a tiny tiny 30% markup. Y'know. For security or whatever.”
@josephfcox Joseph Cox on x
Senator Ossoff just described the X-Mode SDKs as “malware” in a hearing (02:14:35). Asks Google to for a report on if they've fully removed X-Mode from Play Store. Comes after we found X-Mode harvesting location from Muslim app; includes military customers https://www.judiciary.s…
@annaedge4 Anna Edgerton on x
Key quote here from @SenAmyKlobuchar in her opening statement: “Just because it company creates a successful innovative business that consumers like doesn't give it a free pass to harm competition or ignore our antitrust laws.”
@patrickmcgee_ Patrick McGee on x
Apple's Kyle Andeer calls in remotely, says App Store is one of Apple's key innovations. Says app distribution used to be limited, expensive, and when they web-based were subject to security threats. https://twitter.com/...
@issielapowsky Issie Lapowsky on x
Seems like Dems might have the hardest time squaring their stance on app store gatekeeping with their stance on content moderation. Rs are saying tech cos should be hands off of everything. Dems want more content filtering, but seem to be suggesting *app* filtering is a problem.
@patrickmcgee_ Patrick McGee on x
Sen Mike Lee now speaking. Brings up @Parler “In January, in a matter of days both Apple and Google removed Parler from their app stores. They did this despite Parler's close collaboration with the FBI in advance of the January's 6 events.”
@issielapowsky Issie Lapowsky on x
Sen. Mike Lee is already turning this into a censorship thing yippee. Talking about Parler's deplatforming after the Jan. 6 riot. “Millions of voices went silent.”
@dylanbyers Dylan Byers on x
“The woke barons of Silicon Valley” is something Sen. Mike Lee (R-UT) just said.
@issielapowsky Issie Lapowsky on x
As app store hearing begins, Klobuchar notes that Apple and Google's “gatekeeper power” can be used for security, but says the hearing will focus on how that power can be used to “exclude or suppress” competition.
@matthewstoller Matt Stoller on x
Heavy antitrust hearing day. The Senate is now holding a hearing on Apple and Google app stores, basically two monopolies with an aggregate $100B revenue rate annually. https://www.judiciary.senate.gov/ ...
@jeffjohnroberts Jeff Roberts on x
For years, I've told Android users I prefer Apple b/c its app store is more secure. I take it back. Apple obviously doesn't give a s*** about blatant scams. Nice reporting @verge https://www.theverge.com/...
@jason_kint Jason Kint on x
“Potential criminal activity” - more truth to the power at Facebook and Google - presumably based on the alleged charges in the Google antitrust case for their contract signed by Sheryl Sandberg. https://twitter.com/...
@b_fung Brian Fung on x
Khan seems to take a veiled swipe at Facebook's $5 billion FTC privacy settlement, saying that “in some cases, some of these companies may think it's actually worth the cost of business to violate privacy laws.” Critics have panned the deal as little more than a wrist-slap.
@gartenberg Michael Gartenberg on x
Unlikely any member of Congress will ask this question. They will confuse Apple with Facebook and/or Twitter at least three times. https://twitter.com/...
@judiciarydems Senate Judiciary Committee on x
At 2:30 PM ET, @SenAmyKlobuchar—Chair of the Subcommittee on Competition Policy, Antitrust, and Consumer Rights—holds a hearing entitled “Antitrust Applied: Examining Competition in App Stores” with witnesses from @Apple @Google @Spotify @ConsumerFed @TheTileApp & @Match
@matthewstoller Matt Stoller on x
No, the Apple app store doesn't secure privacy or security. As @keleftheriou has shown, the claims of Apple executives on this point are a joke. https://t.co/LZSf6v404H
@amyklobuchar Amy Klobuchar on x
Spotify just testified at our antitrust hearing that Apple has threatened to take them off their App Store and stop promoting them after they spoke out about Apple's monopoly behavior and high fees.
@jason_kint Jason Kint on x
Curious as to Apple's public policy calculus. They were scorched today along with Google. Apple has the largest market cap on the planet, $200 billion in cash and if they had a more friendly App Store, they would likely be on the antitrust sidelines with Microsoft.
@econliberties @econliberties on x
Jared Sine at Match Group just detailed an authoritarian encounter they had w/ @Apple. One @Apple lawyer told him Match Group should be *glad* @Apple didn't take all of their revenue & said “you owe us every dime you make.” 😤
@samsabin923 Sam Sabin on x
Match Group's Jared Sine after being asked about fears of testifying at today's Senate hearing on competition in Apple/Google app stores: “They could hurt us in little ways, they could hurt us in big ways.... We're all afraid is the reality, senator.”
@alistairmbarr Alistair Barr on x
‘You owe us every dime.’ The App Store antitrust hearing did not go well for Apple https://www.bloomberg.com/... via @technology @annaedge4
@pwnallthethings @pwnallthethings on x
Pet peeve, but the appstore cut is 30% of app /revenue/, not app /profit/. It's a much higher cut of profit.
@sentinelcentral @sentinelcentral on x
More information has released on the Epic vs Apple case: Earlier today, Spotify testified that Apple threatened to stop promoting & remove the company off the app store after Spotify complained about Apple's unfair app store policies.
@jacknicas Jack Nicas on x
“There are many, many ways they could hurt our business,” Match's Jared Sine testified about Apple and Google. “We're all afraid is the reality, senator. We're fortunate you're listening to us today.” “Well,” replied @SenAmyKlobuchar. “I hope the Justice Department is, too.”
@annaedge4 Anna Edgerton on x
Apple: “We don't copy, we don't kill.” https://www.bloomberg.com/... with @damclaugh @markgurman via @business
@jason_kint Jason Kint on x
We have premium publishers in @DCNorg who pay 30% of a $500 subscription and we have DCN members who pay 30% of a $20 subscription. Apple makes $150 on the former, $6 on the latter. For the same amount of work. Makes zero sense.
@pwnallthethings @pwnallthethings on x
So if the numbers are right that Apple makes $15-$18bn for the appstore but costs $100m to run, that means they're making a 150x margin on the appstore. Or IOW, a 1% charge for exactly the same service would *still* net Apple just shy of a half-billion dollars in profit per year
@issielapowsky Issie Lapowsky on x
Now Match's Sine is poking holes in the security defense. “Despite multiple requests over the years, Apple and Google still allow under age users to download our apps, even when they know they are under 18. Apple and Google actually make it harder for us to keep our users safe.”
@pwnallthethings @pwnallthethings on x
“We don't look at the appstore as a separate business, we look at it as an integrated part of our entire business” ... uh, yes, that's why the antitrust committee is looking at it
@pwnallthethings @pwnallthethings on x
“we don't favor our own apps [like Apple music that comes preinstalled] over third party apps [like Spotify that doesn't] in the search via the appstore”
@tweabr Twea on x
Information regarding Epic vs Apple Case: Spotify has testified against Apple's threats to cancel promotion and support of the app on the Apple Store after complaints from Spotify's marketing team about Apple's store policies.
@jacknicas Jack Nicas on x
.@SenBlumenthal accused Apple of copying @TheTileApp's products with its new AirTags device. Apple's Kyle Andeer responded: “We always create something different and special and unique.” Here are Tile's trackers. Here are Apple's. They essentially do the same thing. https://twitt…
@kantrowitz Alex Kantrowitz on x
Tile's relationship with Apple went south in a hurry: Its co-founder Mike Farley's LinkedIn page still spotlights Apple featuring his product. Yesterday, Apple released a Tile copy. Today, Tile is testifying against Apple. https://twitter.com/...
@rachelbovard Rachel Bovard on x
Tile's general counsel equates doing business with Apple to “Hotel California.” You can check out, but you can never leave. Also notes Apple uses privacy as a blanket excuse to subject competitors to different rules.
@parkerortolani Parker Ortolani on x
Hey Tile. You make an inferior product. You boxed yourself into a corner on your own. You failed to innovate. You could work with Apple if you wanted to. Find My is optional. Stop being bitter losers.
@karissabe Karissa Bell on x
Den. Lee is asking Apple's lawyer to release the Tile exec from some aspects of Apple's NDA in order to discuss the contractual terms of Apple's “Find My” program.. Apple's lawyer refuses
@jacknicas Jack Nicas on x
Tile's general counsel just testified that Apple would not let Tile use basic “ultra-wideband” technology in in iPhones that would've helped Tile's devices find lost items. Yesterday, Apple released competing devices that use that technology to help people find lost items.
@laurengoode Lauren Goode on x
Daru, from Tile, says that when Apple made changes in iOS for the rollout of Find My, Apple started showing people prompts to turn Tile off but not turn off Find My. Also says new “magic onboarding flow” with AirTags isn't available to third parties like Tile.
@appfairness @appfairness on x
“With the exact same operating system update, they took away one of our critical permissions and required customers to go deep into Apple's settings to turn Tile on. But FindMy, Apple's software, turns on automatically.” -@TheTileApp's Kirsten Daru #OpentheAppStore
@laurengoode Lauren Goode on x
Sen. Lee is asking Tile's Daru questions about Apple that she says she can't answer because Apple required Tile to sign an NDA. Lee immediately turns to Apple counsel and asks co to waive NDA, on the spot. (I have a feeling this isn't going to go very far.)
@brittanyagibson Brittany Gibson on x
Tile's Kirsten Daru wasn't able to talk about Tile's treatment in the app store while Apple was developing a similar product, AirTag, because of an NDA. Sen. Lee (R) asked the Apple rep to release her for questions, and he did not. The products: https://twitter.com/...

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