Japanese government to deliberate new regulatory bill in the Diet to compete with giant IT companies such as Google Apple | NHK | Business Special Feature

Furthermore, as of 2021, the domestic sales of app stores where apps are installed amounted to 1.59 trillion yen for Apple’s “App Store” and 1.4 trillion yen for Google’s “Google Play.”

The source of revenue for both companies is the fees collected from app production companies. A portion of the fees paid by users when they download paid apps or purchase items in app games is paid by Google or Apple as a fee. % commission is paid. From Apple and Google’s point of view, it is natural for them to charge fees because they are conducting transactions using their own app stores and payment systems.

On the other hand, there is also criticism that the oligopoly of the two companies hinders competition and leads to high fees.

How do app providers view this current situation? This time, I applied for interviews with major companies that produce app games, but most of them immediately replied that they were unable to accept interviews. The only company that agreed to be interviewed also requested anonymity.

Why do companies avoid interviews? When I asked a representative of the app company, who spoke anonymously, this was the answer he gave me:

Furthermore, Apple only allows the use of its own app store, so app operators who want to provide services on the iPhone must undergo screening.

Takamasa Kishihara, executive director of an organization that includes businesses that create and distribute apps, also points out that giant IT companies called platformers have tremendous power.

Designating regulated companies and then preventing competitors from using their app stores, payment systems, or browsers, or giving priority to their own services when displaying search results without justifiable reason. Indicates in advance prohibited actions such as: If a company violates the law, it will be made to pay a surcharge of 20% of its sales in Japan.

Under the current Antimonopoly Act, the level of surcharge is more than three times the level for cases in which the activities of other businesses are unfairly excluded, and it increases to 30% in the case of repeated violations. .

Kazuhiko Fuchigawa, an associate professor at Keio University who is an expert on competition law, said, “I think this new law will prohibit requiring the use of app stores provided by Apple and Google.Consumers will be able to use a variety of app stores.“Competition makes it possible to purchase high-quality, low-cost apps.”

If competition lowers fees, the fees that app operators demand from users may also come down. Additionally, if the savings in fees is used to invest in new services and create interesting content, users can expect benefits as a result.

On the other hand, as app stores from various other companies are increasingly being used, there are concerns that adequate security measures may not be in place.

Another challenge is eliminating apps that are not recommended for use by minors. For this reason, the bill allows regulated companies to take necessary measures for security, privacy, youth protection, etc. It is important to consider how to balance security and other measures with the promotion of competition.

It covers fields such as online shopping and SNS, which are not covered by Japanese regulations, and indicates in advance to companies that are prohibited from doing so as they impede competition. In the event of a violation, it is possible to impose a fine of up to 10% of annual sales worldwide, not within the EU, and it can be said that the measures are stricter than those in Japan.

In late March, shortly after full-scale operation, the company immediately launched an investigation into Google’s parent company Alphabet, Apple, and Meta, which operates Facebook and other companies, on suspicion of violating the law. In addition to these regulations, the EU has also strengthened its confrontational stance by imposing huge fines on Apple and Google for hindering competition.

In response to the Digital Markets Act, Apple has announced new terms and conditions that will allow users to acquire apps from other companies’ app stores, which they had previously not allowed, and will also lower fees.

However, even when using other companies’ services, the company has announced a policy to impose new fees on apps that are downloaded more than 1 million times a year, which has sparked criticism from app operators.

Given this situation, there is a risk that companies will take a loophole approach to Japan’s new legislation.

It has even been pointed out that giant IT companies, which earn huge profits based on their overwhelming influence in the digital market, are now becoming entities that transcend national borders. Furthermore, the speed of technological innovation in the digital field is rapid, and I think smartphones, which have changed our lifestyle, are the best example of this. For this reason, in order to make regulations effective, it is necessary to constantly explore new ways to implement regulations in cooperation with the authorities of the EU and each country, rather than attempting to deal with them alone.

Healthy competition is essential for society to evolve without nipping new innovations in the bud. I would like to continue reporting and verifying whether Japan’s new regulations can fulfill this role.
(Broadcast on April 16th on “News 7” etc.)