[Platform Abuse] 'App Toll Fees' STOP! Wave of Lawsuits Abroad Too

Planning - Abuse of Power by Platforms in the COVID Era (Part 2)
Epic Games Sues Google and Apple
Europe Also Issues Preliminary Antitrust Conclusion Against Apple

[Asia Economy Reporter Eunmo Koo] The controversy over commission fee abuse by platform giants is not limited to South Korea. A representative case is Google and Apple, which are forcing 'in-app payments' based on their high market share. As conflicts between app developers, who must pay a significant portion of their app operating revenue as commission fees, and app markets intensify, competition authorities in various countries are also increasingly taking action.

The spark for the in-app payment conflict was Epic Games, the developer of the game "Fortnite." In August last year, Epic Games judged that the forced in-app payment was an unfair exercise of monopoly power and built its own payment system, but was subsequently removed from Google and Apple's app markets. Epic Games immediately filed antitrust lawsuits against the two companies, and the first trial was held this month.

As disputes over app market operations, including Epic Games, continue to expand, platform giants in the United States are being considered as regulatory targets. In October last year, the U.S. House of Representatives investigated the monopoly situations of big tech companies such as Apple, Google, Facebook, and Amazon, and reported that they infringed on consumer rights through unfair practices. Subsequently, the Department of Justice and the Federal Trade Commission (FTC) filed antitrust lawsuits against Google and Facebook based on the House's investigation and their own investigations. In March, the Arizona House of Representatives passed a bill to prohibit app market monopolies, and regulatory bills regarding app market commission policies are being discussed in state legislatures.

Negative perceptions of platform giants in dominant market positions are also high in Europe. On the 30th of last month, the European Commission (EC) issued a statement announcing a preliminary conclusion that Apple abused its dominant position in distributing music streaming apps through the App Store, violating the European Union's antitrust laws. This investigation followed a complaint filed by the music streaming company Spotify in 2019.

The EC pointed out that Apple requires music streaming providers to use in-app payments to sell digital content and charges a 30% commission on all purchases through this system. The forced in-app payment shifts costs to consumers and restricts purchase choices. Regarding the problematic issue, the EC can order changes or impose fines up to 10% of the company's global annual revenue, meaning Apple's fine could reach up to $27 billion (approximately 30 trillion KRW).