On Deceptive Apps and Practices: Unmasking the ACT App(le) Association

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On July 1, the Federal Trade Commission (FTC), under the leadership of new Chair Lina Khan, held the first open Commission meeting in a series of announced monthly meetings. It was interesting to watch, and I have high hopes that Chair Khan, an accomplished Columbia University Law professor who was one of the lead authors of last year’s House report on Competition in Digital Markets, truly understands Big Tech’s market shenanigans. This is why what happened near the end of the meeting surprised me.

The meeting announcement stated that the “Commission will invite members of the public to share feedback on the Commission’s work…and bring relevant matters to the Commission’s attention.” And indeed, invited speakers were mostly small players, like small restaurant owners, independent pharmacy owners, family grocers, family farmers, IT repair providers that electronic companies are trying to kill, etc. Other speakers spoke on behalf of associations that oppose Big Tech practices including Athena, Free Press, and the Parent Coalition for Student Privacy. However, it was surprising to see a speaker for the ACT App Association selected to speak, supposedly on behalf of small business interests.

The ACT App Association should really be called the ACT Apple Association. It was founded in 1998 by Microsoft as a lobbying arm utilizing smaller player’ as a front to support its defense against antitrust charges on both sides of the Atlantic. Over the years, it remained a vehicle for Big Tech interests. Although hard to find (and strategically placed off the members’ page), if you scroll all the way down this page you see the ACT App(le) association’s main sponsors are Apple, Microsoft, Intel, Verizon, and AT&T (other recent sponsors have included Facebook, Oracle, and eBay).

I have written about this “hide behind a supposed app association” charade last year. Since then, we’ve seen real app developers fight for their lives in the Epic Games vs. Apple litigation. However, the ACT App Association filed an amicus brief in support of… Apple (!), and its blog similarly takes Apple’s side. So why is an “app association” opposed to app developers’ interests?

As Florian Mueller recently explained:

“the only organization at the moment that definitely represents developer interests is the Coalition for App Fairness. … Unfortunately, there are a couple of other organizations pretending to represent app developers, but in reality they’re lobbying fronts for large corporations:

  • ACT | The App Association says it “enjoys the support of top companies in the mobile economy.” The first logo that webpage shows (near the bottom of the page I linked to) is Apple’s. . . .
  • The Developers Alliance (previously known as “Application Developers Alliance”) is effectively a Google front”

I hope the FTC understands why the association’s small app developers supposedly support Apple in the Epic v. Apple litigation, why these app developers supposedly care so strongly about standards essential patents (although app developers are never required to take SEP licenses), or how these app developers have the resources to support a 22-employee trade association. The answer is easy. It’s because the ACT App(le) Association represents Apple, Microsoft, Intel, Verizon and AT&T – not app developers.

Also misleading is the Association’s claim at last week’s hearing to represent “thousands of small business software application development companies…located across every state in America.” The Association’s membership page lists thirty entities. Ten of these are European entities surprisingly listed without websites. The remaining ones include a venture capital company, a marketing company, a design company, and at least one entity that appears to be out of business. It is unclear how the remaining dozen or so entities amount to “thousands of small [app developers] … located across every state in America.”

In short, this group is Big Tech masquerading as small business. It bears no resemblance to the small businesses and legitimate public interest organizations who spoke at the open meeting. For the ACT App(le) association to pretend to be an association of little guys is deceptive, at best. Instead of inviting them to speak, maybe the FTC Bureau of Consumer Protection should be investigating them and their sponsors for this misrepresentation.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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