Monday, November 15, 2021

Tech Innovators deserve a level playing field by Barbara Espinosa

Arizona has become a hub for tech innovators. Many think of California's Silicon Valley or New York City as home to many of these companies. But, especially after the pandemic, and as more people work from areas outside the standard office environment, we are seeing areas such as Nebraska’s Silicon Prairie, Colorado’s Silicon Mountain, Arizona’s Silicon Desert grow and thrive as incubators for tomorrow’s technology.

Our Silicon Desert is home to many small to medium-sized tech start-ups and Fortune 100 companies alike. We need to make sure these companies have the tools and ability to thrive and flourish. We have attempted to do this at the state level, with Arizona House Bill 2005, which would have allowed different payment methods on Android and iOS that bypass the Apple App Store's 30 percent transaction fee. Sadly, this bill did not pass-most likely due to the extreme lobbying methods deployed by the tech giants.  We have also seen court challenges, but their results have been middling at best, and did not do an adequate job of protecting these important innovators against the monopolistic tendencies of “Big Tech.”

Now the ball is in the court of the U.S. Congress. In August, the Open App Markets Act was introduced in the U.S. Senate by Senators Richard Blumenthal (D-CT), Marsha Blackburn (R-TN), and Amy Klobuchar (D-MN). A companion bill was later introduced in the U.S. House of Representatives by Reps. Ken Buck (R-CO), Hank Johnson (D-GA), and David Cicilline (D-RI). This important piece of legislation supported by both sides of the aisle in both houses would promote a fair app environment and allow developers to innovate while providing consumer choice. 

Developers in Arizona face detrimental constraints and practices put in place by the large tech companies, like the 30 percent transaction fee on purchases made through in-app payments as well as unfair self-preferencing methods. These strong-arm tactics diminish developers’ capability to bring innovative products to the market. This severely limits choices for consumers in the short and long run.

The Open App Markets Act will provide the much-needed legislative fix to this problem, which is not going away, but actually increasing in its severity. It is a step in the right direction to hold large tech corporations accountable for suppressing competing developers in the U.S. and worldwide. This bill takes square aim at the anti-competitive tactics and seek to provide a level the playing field by blocking app stores from funneling all in-app payment systems to themselves, prohibiting developer-suffocating self-preferencing schemes, and removing obstacles to developers’ direct communication with their consumers.

Simply put, this is good legislation that seeks to find a solution to monopolistic app practices. I am happy to see that it is gaining the support of both parties in both houses. Our state's tech innovators and developers are a growing part of Arizona’s economy, and we will reap the benefits for years to come if they are allowed to succeed. It is my sincerest hope that entire Arizona Congressional delegation, especially Representative Andy Biggs, will come out to support, and even co-sponsor this crucial legislation. Arizona's Silicon Desert’s future is at stake. ###