Apple has improved on the arrangement it’s trying to reach with authorities in the Netherlands and adjusted its deal for reader apps. But the company may have another way to get regulators off its back while protecting its customers’ user experience and privacy – enable sideloading as an option.
Apple is under pressure to open up
There’s been a tumult of regulatory activity aimed at Apple. The gist of this is that the company now faces what looks like an unstoppable tidal wave that will eventually force the company to open up parts of its platform.
A recent EU diktat, for example, may force it to open to third parties including competitors, payment providers, browser developers and, most recently in some weird and seemingly impossible idea, messaging apps.
Reader apps and dating
Apple this week also began allowing “reader apps” to add a link to their own websites for payment and account management. Reader apps are those that “provide previously purchased content or content subscriptions for digital magazines, newspapers, books, audio, music and video.” The company will still collect commissions for purchases within the app itself.
The details of this arrangement are here.
The company is also racking up fines in the Netherlands following a judgement that forced it to permit developers of dating apps to use external payment systems. Apple plans to appeal the judgement, but has been forced to improve on its original approach to comply with that decision.
It’s important to recognize most developers don’t pay a 30% commission — Apple sliced commissions to 15% for most of them in 2021.
Regulators, regulators, regulators
At the same time a tumult of regulation is emerging from governments worldwide. The EU Digital Markets Act and American Innovation and Choice Online Act are just two examples. The sea of litigation continues; most recently a Dutch consumer lobbying group filed a $5 billion lawsuit against the company.
I am someone who thinks the biggest casualty of most of this activity will be the erosion of user privacy and security. Apple’s competitors are probably pleased as they get to extract more profit from the platform Cupertino built.
Apple’s less pleased, as it knows it will be blamed for weakened platform security and increased fraudulent and criminal activity. It has warned that these will be the consequences of some of these moves, but regulators don’t seem to want to listen.
The sideloading scandal
Then there’s sideloading — the idea that you can install apps from third-party stores. Company critics like to point out that you can install applications on Macs from outside the Apple Garden.
What they ignore is that Macs just don’t work like iPhones. A Mac user must have a certain skill before they install/sideload applications; sideloading on iPhones is unlikely to offer the same technical hurdle.
With more than a billion users, not all of them terribly technical, it’s hard to see how consumers are protected by being denied the chance to use a secure and private platform.
[Also read: Triumph in adversity: Apple’s payment system opportunity]
While I expect Apple will be forced to lower its 30% commission rate, will be made to support external payment systems, and may also have to make some of its own apps more optional, I believe sideloading, if it is enforced, should be a consumer choice, not a universal mandate. That may be a way Apple can protect at least some of the user experience, while meeting regulatory demands to open its platform a little.
It just needs to make sideloading an option when users first set up their device.
Consumers do deserve choice, privacy as an option
When you are setting up your account, you would be greeted with a new dialog that gives you the choice to support sideloading. You’d be told the risks and the advantages.
Apple might say something along the lines of:
“If you choose not to support sideloading on your device, we will continue to provide the high quality private and secure experience we’ve always provided on iPhones. If you choose to enable sideloading on your device, we will strive to deliver the best possible experience, but must explain that if you or your device suffer damage because of sideloading an app from an external store, we will not be held responsible. Sideloading is at your own risk.”
I can’t see any reasonable argument against such a proposal.
Yes, it would mean that some things — probably including end-to-end encryption — would probably stop working for users who choose that path. But it would at least explain the risk to consumers and give them a choice.
This would also protect the vast majority of users who don’t want to become responsible for securing their devices, particularly those who recently discovered the risks of relying on some third-party security providers.
What is it really about?
After all, it really is a choice if you decide you want the best possible security and privacy on your devices more than you want the ability to install apps from third party stores. I really don’t see that governments should have any right to insist every consumer endures a poorer customer experience in the name of so-called “free markets.”
Do regulators have the imagination to see this as a viable way forward?
So far, it doesn’t seem that way. That’s because it’s not about opening markets at all. I think it’s Apple’s privacy position they’re really trying to undermine.
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