After a bipartisan group of senators reintroduced the American Innovation and Choice Online Act (AICOA) today, reviving an effort that could have major implications for Big Tech if enacted into law, Apple issued a strong rebuttal of the proposal. Here are the details.
AICOA is back
Earlier today, Senate Judiciary Committee Chairman Chuck Grassley (R-Iowa) and Sen. Amy Klobuchar (D-Minn.) introduced, or rather, reintroduced a bill proposal that seeks to “restore online competition and affordability by preventing the world’s largest digital platforms from abusing their market power to stifle competition, undercut online businesses and raise prices for American consumers.”
The AICOA was immediately endorsed by companies such as Mozilla, Y Combinator, Proton, Yelp, DuckDuckGo, Replit, and others, as well as by several antitrust scholars, advocates, and organizations.
In a nutshell, AICOA would apply to “platforms that have at least $175 billion in average annual gross revenue and reach at least 34% of U.S. subscriber households or 34% of U.S. monthly active users over the age of 12.”
In practice, if enacted, it would prohibit covered platforms from:
- Unfairly favoring their own products or services.
- Misusing nonpublic business-user data to copy and compete against small businesses.
- Unfairly limiting competitors’ access to key platform features.
- Blocking business users from accessing or moving their own data from one digital platform to another.
- Retaliating against users or business users who raise legal concerns.
- Unfairly enforcing terms of service in ways that harm competition.
- Conditioning companies’ access to the platform, or product placement on the platform, on purchase or use of unrelated services.
- Locking users into default settings.
- Skewing ranking or presentation against similarly situated business users.
The bill would also allow federal and state agencies to pursue enforcement actions against Big Tech companies for conduct that harms competition, while carving out protections for privacy, security, and intellectual property.
Today’s reintroduction continues a years-long push to rein in Big Tech. First introduced in 2021, AICOA has repeatedly advanced with bipartisan support, but has never made it to the president’s desk.
Apple shoots back
In a statment to 9to5Mac, Apple said:
“We strongly disagree with the Senate’s consideration of European-style regulation that would hamper innovation and force changes consumers never asked for, while undermining the privacy, security and child safety protections they rely on every day. Apple is proud to be an engine of innovation, job creation, and economic growth in the U.S., where some of the world’s most innovative companies have designed technology that has changed the world. Importing Europe’s failed policies will not increase competition — it will make it more difficult to do business right here at home.”
The company also drew parallels between AICOA and Europe’s DMA, adding that surveys have shown Europeans perceive their online experiences today as worse than before the DMA was enacted.
Apple also noted that AICOA could have a particularly negative impact on children, as it would undermine many of the protections, safeguards, parental controls, and trust and safety APIs it has added to its platforms over the years.
The company also reiterated many of the arguments it has made against the DMA in Europe, including the dangers of increased exposure to alternative app marketplaces and payment systems, of reduced oversight over purchases made outside the App Store, and the availability of adult-content apps through third-party distribution channels. Apple argued that AICOA could lead to similar trade-offs in the U.S. market.
Finally, the company pointed to a study it commissioned last year that found developers largely did not pass on DMA-related commission savings to consumers. According to the study, “despite benefiting from an average commission rate decrease of 10 percentage points, developers kept prices the same or increased the prices on 91% of products.”
What’s your take on AICOA? Let us know in the comments.
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