It’s not very brave to embrace regulation of the tech sector that uniquely spares your platform while restraining all other dominant tech platforms. But that appears to be precisely what Apple’s CEO Tim Cook did this weekend in his interview with Axios.
The Axios conversation pertaining to regulation never left the ambit of privacy protection. That’s convenient for Apple, as the maker of consumer electronics relies less on a user’s data than does Amazon, Google or Facebook. So it seemed a bit disingenuous to Tech Policy Twitter when Cook called for the tech platforms to embrace the coming regulation. Good for thee, but not for me!
Now I wouldn’t expect Axios to raise, in an interview with Cook, non-privacy forms of regulation that might constrain Apple. It sure would have been nice to hear, however, whether Cook could live under a nondiscrimination regime, such as the one proposed by Senator Mark Warner in his recently released tech manifesto. With nondiscrimination rules in place, Apple (and other dominant tech platforms) would be barred from using its own platform to privilege an affiliated app over a similarly situated, independent app. In a section near the end of his report titled “Competition,” Senator Warner called for the importation of cable-like nondiscrimination requirements into the tech sphere:
Legislation could define thresholds—for instance, user base size, market share, or level of dependence of wider ecosystems—beyond which certain core functions/platforms/apps would constitute ‘essential facilities’, requiring a platform to provide third party access on fair, reasonable and non-discriminatory (FRAND) terms and preventing platforms from engaging in self-dealing or preferential conduct. In other words, the law would not mandate that a dominant provider offer the service for free; rather, it would be required to offer it on reasonable and non-discriminatory terms (including, potentially, requiring that the platform not give itself better terms than it gives third parties). Examples of this kind of condition are rife in areas such as telecommunication regulation, where similar conditions have been imposed on how Comcast’s NBC-Universal subsidiary engages with Comcast and Comcast rivals.
In a nutshell, this regulatory regime would police episodes of discrimination by tech platforms on a case-by-case basis. Applied to Apple, an independent app provider excluded from the App Store could bring a discrimination complaint against Apple, and if it prevailed under the evidentiary standard, the remedy would consist of injunctive relief (that is, an end to the discrimination) plus lost profits.
Apple has a history with discrimination. For example, Apple allegedly made some third-party apps obsolete with prior operating system upgrades. Apple also has been accused of rejecting apps for its devices if they compete with its own current or planned offerings. Apple famously blocked Google Voice from its App Store in 2009. More recently, in September of this year, Apple allegedly removed a third-party app called Freedom from its App Store when Apple has a sort-of-competing time-management product.
Or perhaps Axios could have asked Cook whether Apple’s agreement with Amazon to limit third-party repair and resellers of used Apple products on Amazon was an area ripe for regulation.
Several important voices in the policy community have come out in favor of subjecting the tech platforms to a nondiscrimination regime, including Bloomberg’s Noah Smith and Public Knowledge’s Gene Kimmelman. Indeed, your intrepid reporter called for similar protections at the Federal Trade Commission’s recent hearings on the tech platforms. (One of Google’s outside antitrust attorneys pushed back on my proposal, claiming that it was impractical. Skip to minute 1:22:30 on the video.)
In contrast to privacy regulations, a nondiscrimination standard would actually constrain Apple’s conduct—namely, it would prevent Apple from discriminating against third-party app providers in the App Store. Thus, asking Cook about nondiscrimination would serve as a better test of Cook’s true attitude towards tech regulation.
By proving that he has some skin in the game, Cook’s embrace of Senator Warner’s proposal might change hearts and minds. I might even write a new column, taking back all the things I said here about cheap talk. Or I might finally upgrade my MacBook Air.
Twitter: @HalSinger
