Who is hurting consumers more:
a dating-app maker that clandestinely charges some of its users up to five times more for the same service than it charges others; or
a smartphone operating system maker that transparently and consistently imposes a 30% tax on payments in dating apps (and roughly the same for out-of-app payments)?
Sorry to say so: even a vocal App Store critic like me can't possibly answer the question with "Apple."
Unfortunately, the correct answer is a company that co-founded the Coalition for App Fairness. How is it fair to intransparently charge some users five times more than others, for the very same thing?
Next question; closely related to the first. Who is helping consumers more:
non-profit foundations Mozilla and Consumers International, who investigated Match Group's pricing strategies and proved that "Tinder Plus can offer up to 31 unique prices in a single country, and that older users are often charged more" (and that "Tinder's opaque, unfair pricing algorithm can charge users up to five times more for same service"); or
competition watchdogs who fire cheap shots at Apple with legally and technically questionable allegations of non-compliance with a ruling that Apple has every right to appeal?
Admittedly, it was a leading question, but that's because the facts are what they are.
Double standards never work in the long run. At least not in competition policy and enforcement.
On the one hand, something must be done about Apple's App Store monopoly. The iPhone maker continues to drip-feed us with microscopic concessions such as removing a prohibition of app transfers from its requirements for getting a small business discount. The real issue--which is app review and, therefore, the unavailability of alternative app stores--is still far from being tackled other than through some legislative initiatives.
On the other hand, this doesn't mean that anything "anti-Apple" is necessarily meritorious, much less principled.
The Dutch Autoriteit Consument & Markt (Authority for Consumers & Markets; ACM)--sort of the Dutch equivalent of the United States Federal Trade Commission--has the potential to make a very significant contribution to the fight against the mobile app store duopoly if it makes prudent decisions that other jurisdictions adopt. Also, EU competition chief Margrethe Vestager is wielding a huge stick, though she has so far not used it much against App Store abuse (other than the Statement of Objections in the Spotify case, which is good but limited to direct competition by music streaming app makers with Apple). But both the ACM and Commissioner Vestager, whose condemnation of Apple's alleged non-compliance with the rule of law actually raises some rule-of-law questions in and of itself, should really think again--and think hard--about whether it reflects sound judgment to be in the tank for Tinder maker Match Group against Apple even to a post-factual extent and while turning a blind eye to Match Group's own questionable practices that harm consumers.
Dating apps were never the most uncontroversial app category to begin with. Why did the ACM focus on that field--when there is no reason why the Netherlands would have to care more about dating apps than literally any other country in at least the Western hemisphere? It's a bit of a mystery. But I'd have welcome anything that helps address the App Store situation, hoping that whatever works in one segment of the app market today may work in another--or all others--tomorrow.
Tinder's chief lawyer testified in the U.S. Senate that Match Group's apps are all about building "meaningful relationships," which is the height of hypocrisy not because I would (as I could not) deny that meaningful relationships indeed come into being as a result of online dating--but because that's just a part of the picture. The fact of the matter is that a lot of it is about cheating on partners, and the line between dating and prostitution is blurred. Yeah, maybe Match Group has some rules that users theoretically get thrown out if they ask for money, but do they enforce those rules vigorously? Weren't their credible media reports at the start of the pandemic that restrictions on a certain industry resulted in parts of the world's oldest profession increasingly going about their business via dating platforms?
Furthermore, just like Apple's app tax is arbitrary, so are the fees charged by services like Match Group's Tinder. They exploit network effects, just that compared to Apple they've made a negligible contribution to innovation. Chances are Apple innovates more on any given day than Match Group did in its entire corporate history.
Sure, dating apps can serve a wonderful purpose, and I'm not a hypermoralist, but Match Group distorts the reality of online dating in general and its own services in particular.
Even if we assumed for the sake of the argument that Match Group is eligible for sainthood among dating-app makers, the pricing scandal that Mozilla and Consumers International uncovered is truly shocking.
The Dutch ACM is not just an antitrust enforcement agency. They have a broader mandate, which is why I likened them to the FTC. They do look into all sorts of issues. Now, the problem they are facing here is simply this: people wonder why they are pursuing their Apple case at all, given that it benefits Match Group and a few other foreign companies, but no major Dutch player, and the answer is the "C" in the Autoriteit's name. The argument is that it's about Dutch consumers. Now, if there is one huge problem affecting dating-app users in the Netherlands that is worth looking into and addressing, the ACM should follow up on Mozilla and Consumers International's first-rate investigative work. Those non-profits do the job that organizations like the ACM should be doing in terms of "your tax dollars (or euros) at work."
They're not going to abandon their App Store case, and I wouldn't even want that. But they should sit back and think again. They should keep a low profile in this enforcement context because Apple's requirement for submitting a separate app for the Dutch market is reasonable even in the eyes of an Apple critic like me. Commissioner Vestager supported the ACM in her recent Berkeley speech despite DG COMP neither having reached any conclusion on the App Store (not even in the Spotify case) that comes close to the underlying Dutch ruling nor DG COMP having to resolve that Dutch enforcement dispute (which will be for Dutch courts, and possibly the European Court of Justice if a question of EU law needs to be sent to Luxembourg).
Maybe the Match Group case against Apple in the Netherlands isn't all that great, neither legally nor technically or politically. Maybe it's like a company putting out a first product and then doing better on the second. There are presumably plenty of complaints, some of which will relate to app categories with a much better reputation and will come from companies that don't charge up to five times more if an older user pays for a particular service than if a younger one does, without at least telling everyone that this is the case.
The ACM should build a better story, a better case, and ultimately impose better remedies--remedies that can clearly be enforced in a way that makes a positive impact. Apple is playing sort of a legalistic game, but it's a pretty universal rule--which the European Commission is also perfectly aware of--that if someone has to comply with a ruling, anything counts as compliance that is not based on a wholly unreasonable interpretation or application of the underlying decision. The standard is not whether another position may make more sense. I would even agree that the ACM's apparent position on what Apple should be doing in the Dutch dating-app market is more reasonable than Apple's--but that doesn't make Apple's wholly unreasonable.
Regrettably, the Tinder pricing scandal is also unhelpful to Epic Games. The Fortnite maker co-founded its Coalition for App Fairness with Match Group and Spotify. It's bad enough that an amicus brief proposed by the CAF was rejected by the United States Court of Appeals for the Ninth Circuit, the most important regional appeals court in the world--it's arguably more important to the global economy than almost any national top court. Now a CAF co-founder faces a major credibility problem when it comes to the question of who really overcharges app users.
It didn't help Epic that some internal emails surfaced in the Apple litigation that called its motives into question. But that was really just anecdotal evidence as Judge Gonzalez Rogers called it toward the end of the trial. And Judge YGR may dislike impulse purchases, especially by (Fortnite-playing) kids, which is why she sort of invited litigation against both Apple and Epic over that question. Then dating apps are also about impulse purchases, and there is no type of purchase where transparency is more critical than (in-app) impulse purchases.
As an advocate for the rights of app users not to be overcharged by abusers, Match Group has zero credibility left. Literally zero. This will have major ramifications also for its lobbying efforts. Hopefully more companies will advocate for App Store reform--companies who really practice what they preach when it comes to "App Fairness." If they're large and have been around for a long time, someone will always find something to criticize about what they did, even if it happened ages ago--but at least they shouldn't be App Unfairness hypocrites.
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