US-based tech giants are worried about the new antitrust legislation as Apple CEO Tim Cook and Alphabet CEO Sundar Pichai have been personally “calling and meeting with Senators,” urging them to oppose the mooted legislation, media reports say.
The legislation in question is The American Innovation and Choice Online Act, a bipartisan bill spearheaded by Amy Klobuchar (D-MN) and Chuck Grassley (R-IA), citing Punchbowl News, The Verge reported on Thursday.
The legislation is currently in its early stages and is set to be considered by the Senate Judiciary Committee.
The bill would need to pass in both the House and Senate to become law, but it’s still easy to see why it’s ruffling feathers with Silicon Valley’s biggest beasts.
The legislation prohibits online platforms from advantaging their own “products, services, or lines of business” over those of rivals, the report said.
It applies only to the biggest tech companies — Apple, Amazon, Facebook-owner Meta and Alphabet’s Google, it added.
These platforms would be barred from behaviour like biasing search results in their favour, limiting rivals’ access to platform data, and using non-public data from customers to compete against them.
Although the exact impact of the legislation is difficult to predict, one aspect that worries Apple, in particular, is a possible threat to its App Store business model, as per the report.
In a letter sent by the company to the Senate Judiciary Committee, Apple said that if the bill became law it would be forced to allow users to “sideload” apps onto iPhones and iPads as it does Macs — meaning installing them from sources outside the App Store.
Apple said this threatens the security of its users by allowing unvetted apps onto devices and cuts into one of its main revenue streams (Apple collects up to 30 per cent commission on App Store sales).