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Wednesday, April 13, 2022
Apple has a better motivation than privacy to fight hopeless reform
Apple (AAPL) CEO Tim Cook released his public statement this week against the proposed anti-trust law targeting the company’s App Store. Cook says allowing customers to download apps on their iPhones from third-party sources will give them less security.
During a meeting of international privacy experts on Tuesday, Cook said, “If we are forced to allow unverified applications on the iPhone, the unintended consequences will be profound.
Cook is right that the App Store helps protect users from malware, and third-party options increase the risk of iPhone users downloading fraudulent applications. However, there is a big reason for the Apple leader to oppose the law: Apple’s grassroots tax.
This is because if users download apps outside the App Store, they will lose the 30% charge that Apple collects on multi-app sales. Apple did not break revenue from its App Store, but its service division, which includes the App Store, brought the company’s total revenue to $ 68 billion to $ 365 billion in 2021. Since 2008, the App Store has grossed $ 260 billion.
“Maintaining central control is highly profitable for Apple – a way for Apple to allow users, app developers and consumers on both sides of its platform to set prices,” Penn State Law Professor John Lopatka told Yahoo Finance. “And maintaining central control inevitably hurts competitors.”
The Apple App Store keeps users safe
Cook argues for a proposed anti-trust law called the Open App Market Act, which would make users less secure by eliminating Apple’s ability to verify every app users install on their devices.
And he is right.
Without the App Store, users can download and install apps from any third-party App Store or site of their choice. While it gives users more freedom, it also opens up the possibility of downloading malware-loaded applications that could steal their information, obtain their login credentials or capture their bank data.
“It’s true that Tim Cook has a real business here,” explained Justin Cappos, a professor at the NYU Tandon School of Engineering. “And it’s not a small business. If things change, there will be privacy and security trading, especially for page loading.”
That too is not a stand-alone position. Lopatka echoed Kapos’ concerns about consumer security and privacy, saying that the removal of central control of Apple’s apps “undoubtedly creates the risk of malicious and intrusive software entering the phones.”
This is a basic thought. As users are naturally given more ways to download the app, they are more vulnerable to dangerous applications.
Of course, the Apple App Store will not keep you completely safe. According to The Washington Post’s 2021 report, 2% of the App Store’s 1,000 highest grossing apps are fraudulent apps.
However, Apple’s iOS and iPadOS are more secure than competing products because they have the latest software updates. Apple Devices security and feature updates that automatically download and protect users from malware that exploits flaws in Apple’s software.
It’s about Apple’s foundation
Apple’s privacy and security chops are one of its biggest selling points. For consumers who seem tired of having every company absorb or sell their data online and offline, it is worth paying a premium for the company’s devices. Apple’s entry-level iPhone SE starts at $ 429, while Samsung’s A03s starts at $ 159.
Apple, of course, also benefits from user data. The company’s Safari browser uses Google as its default search engine, which earns Apple $ 8 billion to $ 12 billion a year, according to a lawsuit. Google, naturally, uses information gathered from users’ searches to inform its advertising business.
That aside, losing control of the Apple App Store could affect Apple’s base. The company currently charges 15% or 30% on sales of some applications. However, Apple only uses those fees when developers use payment technology in its application. Of course, only developers can use Apple’s technology, so they are forced to pay every time a customer buys an app.
That, the developers say, forces them to raise prices, which is detrimental to them and their customers. Developers like Spotify (SPOT), Epic and many others have been fighting this for years. It looks like Apple is finally being forced to loosen its iron grip on the App Store as hopeless laws finally come through Congress.
This does not mean that users will be left to fend for themselves. Under the proposed law, companies that are closed to protect the security and privacy of users or to prevent spam or fraud will not violate the Open Application Market Act.
That does not mean that Apple can fully protect users, especially those who want to use third-party app stores. This means that Apple will still have the ability to provide at least some protection for users.
While allowing users to load applications side-by-side on Mac desktops and laptops, Apple is already working to ensure that its MacOS products are protected. If the Open App Markets Act becomes law, the company will have to do the same on its iOS and iPadOS products.
While this may not be as secure as Apple had complete control of the App Store environment, it will allow for more competition. This will help consumers in a different way – by protecting their wallet.
By Daniel Howley, Technical Editor at Yahoo Finance. Follow him Daniel Howley
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