Bulletins

Microsoft vows to adapt to app store regulations — just not for Xbox

The company is getting ahead of potential U.S. regulation with the proposed Open App Markets Act.

An image of Microsoft's cloud gaming setup.

Microsoft said its new app store commitments are about "adapting to regulation" rather than "fighting against it."

Image: Microsoft

Microsoft has announced a series of new app store policy commitments, which apply to its Microsoft Store on Windows and in its various gaming marketplaces. The company specifically cited proposed U.S. regulation, which includes the Open App Markets Act and the American Innovation and Choice Online Act, along with potential scrutiny of its Activision Blizzard acquisition, as the motivating factors.


The post, authored by President Brad Smith, outlines 11 principles the company has pledged to follow with how it treats developers and the rules it imposes on software distribution. Some of these principles cover existing positions, like Microsoft's announcement last year it would not forbid app-makers from using a third-party payment system for software sales through the Microsoft Store.

But Microsoft is going a step further today in "adapting to regulation" rather than "fighting against it," Smith wrote. He explained that the commitments the company is announcing today are "grounded in app store legislation being considered by governments around the world, including by the United States, the European Union, the Republic of Korea, the Netherlands, and elsewhere."

The principles include three commitments to quality, safety, security and privacy; two on accountability, including a pledge to "not use any non-public information or data from our app store to compete with developers’ apps"; two on fairness regarding the ranking of apps and marketing and placement in its stores; and four principles on developer choice, outlining Microsoft's positions on letting app-makers choose third-party payment systems and communicate with customers.

Many of these positions stand in stark contrast to App Store restrictions Apple has been vigorously defending both in the antitrust lawsuit against Epic Games and in bouts with regulators around the world. And Smith's post takes a clear shot at Apple.

"Our vision is to enable gamers to play any game on any device anywhere, including by streaming from the cloud. App stores on the most relevant and popular everyday devices like mobile phones; PCs, including Windows PCs; and, in time, the cloud, are important to realizing this vision," Smith wrote. "But too much friction exists today between creators and gamers; app store policies and practices on mobile devices restrict what and how creators can offer games and what and how gamers can play them."

All 11 of these principles will apply to Microsoft's approach to software distribution on PC, mobile and the cloud, but not all of them will apply to its Xbox platform. The company sees its Xbox console as a closed ecosystem; in the Epic trial, Xbox executive Lori Wright outlined how the company loses money on hardware sales and relies on the closed nature of the Xbox platform to earn money on software sales and subscription services.

"Some may ask why today’s principles do not apply immediately and wholesale to the current Xbox console store. It’s important to recognize that emerging legislation is being written to address app stores on those platforms that matter most to creators and consumers: PCs, mobile phones and other general purpose computing devices," Smith argued. It's a position Wright also emphasized in her testimony, and one Microsoft has publicly expressed to explain why Xbox should not be open to third-party app stores.

"Gaming consoles, specifically, are sold to gamers at a loss to establish a robust and viable ecosystem for game developers. The costs are recovered later through revenue earned in the dedicated console store," Smith said. "Nonetheless, we recognize that we will need to adapt our business model even for the store on the Xbox console. Beginning today, we will move forward to apply Principles 1 through 7 to the store on the Xbox console."

Smith did, however, add that Microsoft is "committed to closing the gap on the remaining principles over time," and that it will "incorporate the spirit of new laws even beyond their scope, while moving forward in a way that protects the needs of game developers, gamers, and competitive and healthy game-console ecosystems."

It's unclear if that means Microsoft may in the future open the Xbox platform to third-party payment systems or alternative app stores, or if the company intends to lower its store commission on Xbox from 30% to 12%, as it did last year for PC gaming apps on the Microsoft Store.

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“Been thinking about anti-perks in tech jobs. What perks *sound* good but are a hard no from you?”

The tweet came from Jessica Rose, a developer relations advocate, founder of a meetup series for programmers and aspiring programmers and co-founder of Trans*Code, a hacker org devoted to drawing attention to transgender issues and opportunities.

Rose’s “hard no” was to those so-called benefits that have been around since time immemorial (or at least since the dot-com era). “Don't give me food or hammocks or video games, just let me work remotely or go home on time,” said Rose.

'Don’t touch me'

The tweet thread was full of varied responses, but the paradox of unlimited vacation was the clear favorite. “Wow, people are just so suspicious about unlimited paid time off,” Rose told Protocol when we caught up with her to ask about the tweet.

Other workers balked at in-office massages (“don’t touch me”), free booze, open-plan offices (did anyone in the history of the world ever call this a benefit?), fitness rooms, nap rooms, escape rooms (really any rooms), and something called “blameless retrospectives.” Um, what?

If employees are going to be suspicious of whatever perks you offer, why offer any perks at all?

“So I'm aware of how wonderfully spoiled it is to complain about perks being given out in some kinds of tech workplaces,” said Rose. “I'm the most unimpressed by ‘perks’ which either directly undermine employment rights (like unlimited paid time off can do in some regions) or are intended to throw work/life balance out of kilter in the workplace's favor.”

Unlimited or flexible vacation time can work, but it helps when the culture is one where people are encouraged to take time off and experts agree that mandatory minimums go a long way in helping create that kind of culture.

Your best interests or mine? Why can’t it be both? ¯\_(ツ)_/¯

A director of engineering at Google who formerly worked at Microsoft and Zillow called employer-sponsored coaching an anti-perk. “I’ll spring for a coach who is looking out for my best interests, not the company’s, thanks,” she said, adding, “I know I am lucky to be offered this, but it always feels like a trap.”

There’s good reason to be at least a little wary of these programs. Last year Protocol reported that when tech companies work with coaching programs like BetterUp and Bravely the conversations themselves are confidential, but the company often receives aggregated reports on the issues workers are expressing in general, the topics they’re discussing, what's going well for them at work, and what's not.

When Protocol spoke to Twilio’s VP of talent management Andrew Wilhelms about the company's coaching partnership, Wilhelms explained that BetterUp provides a set of Twilio-specific priorities to coaches and Twilio can update those priorities and goals based on what kind of culture change the company needs to see.

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“Thoughtful, meaningful perks can benefit both employers and team members, by helping keep their team members happy and hopefully keep them in their role for longer,” Rose said.

Free SunChips < values-based work culture

Research shows that today’s employees don’t want snacks as much as they want work that aligns with their values, and that extends to benefits.

  • “I love work perks that demonstrate an employer's ethics and commitment to meaningfully supporting their team members,” said Rose.
  • These benefits can include big structural benefits like location-agnostic pay and support for different kinds of employee leave, but also smaller things like “sending people a small bonus on their birthday to buy a cake,” Rose added.
  • Rose also looks for “employers who don't subcontract out cleaning or security staff, to make sure that all of their team members get access to the same kinds of pay and support.”

What your 'perks' say about your corporate culture

Some “anti-perks” are just common decency and respect, such as believing your employees are telling the truth when they call in sick. In response to Rose’s prompt, one senior system admin pointed out a job listing that offers an “honor-based sick leave policy” in addition to its “commitment to an open, inclusive and diverse work culture.”

And think twice about listing your game room in your job description, tweeted a product designer from Miro:

“When they advertise a ping-pong table in the job listing, it's a huge 🚩 for me. And I love ping-pong. If a silly perk like this [is] such a relevant part of your benefits package, that says a lot about what the company values, and likely its culture."

A version of this story appeared in Protocol's Workplace newsletter. Sign up here to get it in your inbox three times a week.

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“The impression I have is that it’s basically not enforced,” the employee said. The Google contractor said attendance varied across different teams, noting that while some of their teammates go to the office three days a week, most only go in once. (Neither Google nor Apple returned emails inquiring about how their hybrid policies are enforced.)

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More than 40% of HR leaders surveyed by Gartner last month said they weren’t tracking office attendance. Thirty-five percent said they were gathering attendance data from key fob or badge swipes, while 22% said managers were tracking their teams’ attendance. Another 10% said employees were self-reporting their attendance.

Companies that selectively enforce attendance requirements may wind up with unfair outcomes, Kropp said.

“If you have a mandated set of days where you have to come to the office, but it’s unevenly enforced across the company, then you run into issues of fairness,” Kropp said. “That just creates more variability across the company, which then creates more risk as well in terms of that inconsistency.”

And while flexibility puts companies at an advantage when it comes to competing for talent, it also requires more sophisticated management, Kropp said. “The question you should really be asking is: Does our managerial population, on average, have the capability to manage much more flexibility, or not?” Kropp said. “If the answer is ‘yes, they do,’ you should push for as much flexibility as you can.”

To run high-performing teams in a flexible environment, managers need to be “half social worker, half engineer,” Kropp said. That means more empathy and more capacity for planning and organization.

While companies may seem settled into their hybrid ways of working, many leaders are leaving policies open to change with time rather than overcommitting themselves. The world is unpredictable, as we’ve learned in the last 2.5 years. “A lot of these executives — the way that they’re framing it now is, ‘This is our hybrid strategy for now, and it could evolve and could change,’” Kropp said.

Amazon falls into that category. As Andy Jassy put it at the Code Conference on Wednesday, Amazon doesn’t have a plan to force employees back to the office: “We’re going to proceed adaptively as we learn.”

A version of this story appeared in Protocol's Workplace newsletter. Sign up here to get it in your inbox three times a week.

Bulletins