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Questions that CCI should explore in its investigation into Apple and Google

Also includes follow-ups that let India’s competition regulator dig deeper.

The Competition Commission of India (CCI) is investigating the Apple App Store and Google Play Store after multiple developers complained that Apple and Google’s in-app payment policies are too restrictive and commissions are too high, among various other complaints. As part of these investigations, here are some questions we think the CCI should consider.

These questions were initially posed by the United States Department of Commerce’s National Telecommunications and Information Administration (NTIA) as part of its report on competition in the mobile app ecosystem in the US, but have been slightly adapted for the Indian context.

Questions around definitions and scope

  1. How to measure whether the app ecosystem is competitive?
    1. How should the “success” of an app be measured?
    2. How should the “failure” of an app be measured?
    3. Does the reported total of the number of apps available at any one time in an app store have bearing on the state of competition among apps or particular categories of apps?
  2. Are there any important entities mistakingly omitted (or included) because of the chosen definitions of relevant markets?
    1. If so, how should this study be scoped so that it is optimal but feasible?
    2. For example, should mobile apps offered specifically for enterprise use (e.g., for use by businesses, not for consumers) be considered in this study?
  3. Apps are not all the same. For example, some have different technical features and capabilities (e.g., location-based apps compared to messaging apps), while others are bound by specific regulatory guardrails (e.g., banking apps or children’s apps). In the context of framing competitiveness within the ecosystem, how should we categorize types of apps so that they are grouped by distinguishable barriers and other significant factors? Are there ways to best categorize or segment the market to diagnose specific market barriers, such as those that could impact app developers or consumers?
    1. Should distinctions be made based on the type of content and app functionality?
    2. Should distinctions be made based on the level of hardware or operating system integration required for the app to function? For example, categories might include apps that access location data, special-purpose hardware (e.g., near field communications), secure elements for payment, or other credentials.
    3. Should a distinction be made for apps that are the primary way (or the only way) the app provider interacts with users, as opposed to apps that are an extension of an existing digital or physical business? Do app-based businesses face different competitive constraints than businesses that have a brand and presence outside of mobile apps?
  4. How should web apps (browser-based) or other apps that operate on a mobile middleware layer be categorized?
  5. There are some indicators that there is a difference in kind between some apps that generate large amounts of money or are downloaded often and most other apps. For example, one industry analyst reported that 97% of publishers that monetize through the Apple App Store earned less than $1 million per annum in 2021, compared to other reports of more than $1 billion earned by the top 13 apps (including games) on both Apple and Google platforms. What is the best way to assess the competitive environment for less popular apps and start-ups?
    1. Can any potential harms, such as deficiencies in data security and privacy protections, be traced back to the current market imbalance?
    2. Is there evidence to suggest that consumers are less likely to avoid or stop using a particular app even if they would prefer a more privacy-enhancing environment because of a lack of competitors offering similar services?
  6. Are there governance practices, regulations or laws that impact competition among certain categories of apps more than others, or their non-app counterparts?

Questions around app development

  1. What unique factors, including advantages and obstacles, are there generally for app development — especially start-ups — that are relevant for competition?
    1. Are there unique market dynamics in this ecosystem (such as the existence of a small number of dominant technology companies) that affect mobile apps’ ability to secure funding?
    2. Are some methods of monetization essential to the economic success of an app? What are they? For example, is there pressure to incorporate advertising or collect personal data of users or engage in unique relationships with data aggregators?
  2. Are there particular obstacles preventing more development from different communities, such as location/region, ethnicity/race, language, or gender?
  3. Are there studies or specific examples of the costs or advantages for app developers to build apps for either, or both, of the main operating systems, iOS and Android (which have different requirements)?
    1. What are the challenges specific to multi-platform development and how can they be mitigated?
    2. What are the costs and advantages of developing standalone apps for these platforms relative to other means of providing the same services or content, such as web apps, which can operate across platforms?
  4. What role does interoperability play in supporting and advancing a competitive mobile app ecosystem?
    1. What are the key characteristics of interoperability as it relates to the mobile app ecosystem?
    2. What other barriers ( e.g., legal, technical, market, pricing of interface access such as Application Programming Interfaces [APIs]) exist, if any, in fostering effective interoperability in this ecosystem? How are these barriers different or similar to those present in other ecosystems?
    3. How does data portability, or lack thereof, factor into consumers keeping the same app if they switch from one operating system (iOS or Android) to another?
  5. While apps can be coded from scratch, Software Development Kits (SDKs) and other technical tools can make it easier for developers to create apps. What data is available to show how such tools shape the ecosystem and affect the ability of developers to compete?
    1. Which tools are most often used by app developers and what are the entities that offer those tools?
    2. Do these tools make it easier for a developer to create apps for multiple platforms? How so? Are there any trade-offs (e.g., performance, battery life, or stability) for using these tools?
    3. Are developers of certain types of apps more likely to use the assistance?
    4. Are there privacy or security concerns associated specifically with these tools?
    5. What empirical data exists to support findings on this topic?
  6. How do policy decisions by firms that operate app stores, build operating systems, or design hardware impact app developers ( e.g., terms of service for app developers)? What empirical data exists to support those findings?
    1. In particular, how does a lack of transparency about app market rejections affect app developers ( e.g., costs)?
    2. How do the policy decisions affect or limit the feasibility or availability of alternative models of app development ( e.g.open source), delivery ( e.g. browser-based apps), or funding ( e.g. non-commercial or donation-based models)?
  7. What types of labour restrictions or workforce pipeline challenges, if any, limit paths for app innovation? What may solutions look like?
  8. Some apps make use or would like to make use, of additional mobile device components beyond those that are more commonly accessible (e.g., camera, microphone, contacts) in order to offer an innovative product or service, but the operating system or device provider does not allow such access. Similarly, for some apps, it might be essential to be able to interconnect to other hardware and services, such as cloud services. What are the valid security concerns and technical limitations on what device functionality an app can access?
    1. What factors should be considered in striking a balance between encouraging companies to ensure proper security measures, while allowing third parties to access the protected features that might allow for further innovation and competition?
    2. Are there specific unnecessary (e.g., technical) constraints placed on this ability of app developers to make use of device capabilities, whether by device-makers, service providers or operating system providers, that impact competition?
    3. Are there other means or factors to consider for mitigating specific risks that would not inhibit competition?
  9. What unique challenges, if any, do software updates pose for app competition, including updates driven by the app developers and those necessitated by other ecosystem changes, such as operating system updates? How does this impact security and costs for those apps, products, and services?

Questions around app distribution

  1. Some mobile apps are pre-loaded on mobile devices or set as default apps, while others are only available through an app store, through a browser (web apps), or, for devices using the Android system, by sideloading. Is there data comparing these mechanisms and their effect on app distribution?
    1. Is there a competitive advantage to being preloaded or available by default to the users of phones and tablets? What is the evidence to support or contradict there being an advantage?
    2. Is there data on the number of developers that have been able to have their apps preloaded or available as default apps or the types of apps?
    3. What information is available on the types of agreements these developers reached and with whom to preload or set their app as a default app?
  2. As noted above, governments and courts are already exploring concerns about control of app access to users exercised by mobile app stores and other ecosystem participants.
    1. What data and studies exist that identify specific additional obstacles that developers and businesses might face related to the distribution of apps? Commenters may reference factual findings in existing cases and filings in government explorations
    2. In particular, what studies have been done on requirements that apps use an app store or operating system’s own services or the appeal of alternative mechanisms that do not tie app access to using other products or services from those mechanisms?
  3. How do, or might, alternative app stores (other than Google Play or the Apple App Store), affect competition in the mobile app ecosystem?
    1. What data is there to assess how well existing alternative stores distribute apps, in general, or specific types of apps?
    2. What unique barriers are there affecting each of the main operating systems (Android, iOS) that might prevent web apps or—to the extent allowed on the Android system—alternative app stores and sideloading, from gaining more popularity with users and app developers than they currently have?
    3. Is there an analysis comparing competition in the iOS ecosystem (where app distribution is limited) to that of alternative distribution mechanisms on Android operating systems?
  4. What evidence is there to assess whether an app store model is necessary for mobile devices, instead of the general-purpose model used for desktop computing applications?
  5. Mobile app stores act as initial screeners and responders for concerns about mobile app content, such as fraudulent apps and malware. Similar issues for screening and responding exist in other contexts, such as website hosting and search engine retrieval. What empirical data is there analyzing any unique content screening issues related to mobile app stores that affect competition?
    1. Is there evidence of legitimate apps being rejected from app stores or otherwise blocked from mobile devices? Is there evidence that this is a common occurrence or happens to significant numbers of apps?
    2. What assessments are there of their effectiveness, or lack therefore, on security and privacy of end-users?
    3. Are there disincentives or unique barriers affecting the degree of security and privacy protections offered by alternative app stores?
  6. Are there other areas, specific technologies or procedures, that offer lessons on more and less successful ways to screen out problematic apps? What are the characteristics of such success?
    1. Are there good examples by enterprise users?
    2. For example, some devices allow sideloading only after warning the user to make sure they trust the app before proceeding with the download, in a way similar to how some browsers issue warnings for unknown websites. What material exists about the efficacy of such methods?
    3. What roles, if any, do independent or third-party security testing play in the app store ecosystem?
    4. Does the current model discourage competition and innovation in the development or advancement of security testing?
  7. How does the existence of imposters and other fraudulent apps affect developer incentives or legitimate app lifecycles?

Questions around app users

  1. What research exists regarding the number of active apps consumers have on their mobile devices at any one time and how often they try new ones?
    1. Are there generalizations that can be made based on items such as the cost of the app, type of broadband access or device, or even categories of phone users?
  2. How do most consumers find and make decisions to use apps?
    1. Is there data to show whether the usage of an app or any other relevant metric for performance is tied to existing brand visibility outside of the mobile app ecosystem?
    2. Is there data about how often people use the search feature in an app store, search engines through browsers, or particular ranking lists of popular apps or app storefronts?
    3. Is there empirical data that examines how app rankings, app reviews, or other objective measures of apps (for example, popularity, quality, or the number of downloads) are used (or manipulated) to influence consumer choices?
  3. If the goal is to maximise “user benefit” with regard to competition in the mobile app ecosystem, how should we measure or consider user benefit?
    1. What is the appropriate scope of users for consideration? Should it include developers?
    2. If there are conflicts between end-user and developer interests, how does this affect the assessment of user benefit?
    3. How might convergence of end-users and developers—through low-code environments, for example—affect this dynamic moving forward?
  4. Do apps that are developed for, or used by, certain communities (such as by income, ethnicity/race, or gender) face significantly different competitive challenges? What are the challenges?

Questions around potential actions to increase competition

  1. What specific measures might the government take to foster healthy competition—especially for nascent app innovation—in the mobile app ecosystem?
  2. What specific actions could the private sector and civil society take to ensure and promote healthy app competition (such as technical standards development or monitoring)?

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