The Intelligence from The Economist Stores of value: regulators lean on app vendors
May 27, 2024
Guy Scriven, the US technology editor for The Economist, discusses the app economy dominated by Apple and Alphabet, examining the challenges of regulatory scrutiny and emerging competition. Sakeep Rahim, a science and technology writer, brings insights on innovative strategies to combat desert locust swarms, including drones and low-tech solutions. They also explore the astronomical costs of India's elections, influenced by digital marketing and regulatory complexities. This lively conversation ties together technology, ecology, and political finance.
AI Snips
Chapters
Transcript
Episode notes
App Store Revenue
- Apple and Alphabet's app stores generate significant revenue through in-app purchases and subscriptions, earning them about $40 billion annually.
- Despite being a seemingly small portion of their total revenue, app stores boast impressive margins of around 80% for Apple and 65% for Alphabet.
Government Intervention
- Governments worldwide are increasingly interested in regulating app stores, aiming to control which apps are available and to lessen Apple and Alphabet's dominance.
- This includes removing unsavory apps and those posing geopolitical risks, like TikTok, due to concerns about data access and disinformation.
Breaking the Duopoly
- The EU's Digital Markets Act aims to break up Apple and Alphabet's app store duopoly by forcing them to allow multiple app stores on their devices.
- Developers like Spotify and Epic Games support this, hoping for lower commission fees and fairer competition.