South Korea Cracks Down On Big Tech

August 25th, 2021 6:12 PM

A committee in the South Korean parliament voted to recommend amending legislation that would ban Apple and Google from charging software developers mandatory fees for in-app purchases.

According to Reuters, Apple and Google charge commissions of up to 30% for in-app purchases.

Apple slammed the measure, arguing that the bill "will put users who purchase digital goods from other sources at risk of fraud, undermine their privacy protections" and damage user trust in App Store.

Google seemed to be on the same page, calling the legislation “rushed.”

"[T]he rushed process hasn't allowed for enough analysis of the negative impact of this legislation on Korean consumers and app developers,” Wilson White, senior director of public policy at Google, said.

One expert said app store operators should try to instead profit from more valuable services.

"Dominant app store operators with large platforms should by now look to profit from value-added services, not just taking a cut from apps sold on its store," Yoo Byung-joon, a Seoul National University School of Business professor and electronic commerce expert, said.

The move follows the pushback Big Tech is currently facing in the United States.

Earlier in the month, the U.S. Federal Trade Commission refiled a lawsuit against Facebook, arguing that the platform is a monopoly, calling into question its acquisition of both Instagram and WhatsApp.

The FTC aims to prove that Facebook has monopoly power.

“Facebook lacked the business acumen and technical talent to survive the transition to mobile. After failing to compete with new innovators, Facebook illegally bought or buried them when their popularity became an existential threat,” Holly Vedova, Acting Director of the FTC’s Bureau of Competition, said.

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