Antitrust in the Apps Market

Apps have been playing an increasingly important role in our everyday lives. Billions of people around the world possess a smartphone and utilize apps on a daily basis: whether it is checking the weather, replying to e-mails, sharing content on our social media profiles, playing videogames or anything in between, there is little-to-no limit to what an application software can do. Apps have become such a widespread phenomenon because of their ability to transform mobile phones into devices that can be compared, to a certain extent, to personal computers, all while maintaining the intrinsic comfort of utilizing a small portable device. Without a doubt, apps have contributed to the success of smartphones, and vice-versa: a new ecosystem had been created, which consequently spurred relevant economic opportunities, both for developers and for hardware producers. As the market size of apps increased, so did the market concentration in the hands of a small number of platform providers, unveiling several issues for app developers. The present work is structured in three different sections: the first section aims to deliver a general overview of the application software market by providing the definition of “two-sided markets” or platform markets, examining the drivers of growth, as well as analyzing the various revenue models of application software developers, placing emphasis on gaming apps. The second section consists in an analysis of the topic of competition from a more general point of view, highlighting the motives for the genesis of competition law in contemporary times, and providing a brief summary of antitrust legislature in the United States and in the European Union. Finally, the third section presents the study of two antitrust cases that might set as the stepping stone for antitrust in the apps market: the cases of Spotify v. Apple, and Epic Games v. Apple. The two companies have cited Apple to court due to allegations of monopolistic conduct and anti-competitive practices: given the fact that the app market is still relatively on its early stages, the outcomes of the two trials might become relevant for the adoption of more market-specific antitrust legislation in the near future.