There's a new bill that's making Apple nervous, and it's called SB 2333.
It spans all of two pages and makes its point quite clear. It says a "digital application distribution platform" that does than $10 million in revenue in North Dakota each year — which includes every major app store — cannot:
- "Require a developer to use a digital application distribution platform or digital transaction platform as the exclusive mode of distributing a digital product."
- "Require a developer to use an in-application payment system as the exclusive mode of accepting payment from a user to download a software application or purchase a digital or physical product through a software application."
- "Retaliate against a developer for choosing to use an alternative application store or in-application payment system."
Where did this come from? Kyle Davison, the North Dakota state senator who co-sponsored SB 2333, told me the Coalition for App Fairness originally brought up the bill to a firm in Fargo, North Dakota, where Davison and others are working to create more of a tech scene.
- "We have created an entrepreneurial environment in our community ... that really revolves around innovation," he said. He saw SB 2333 as a way to benefit tech workers in the state, as well as hopefully entice people to move there.
- It's not a crazy idea: People move to escape income tax, so why wouldn't some software companies move to escape a 30% app store commission?
In essence, the bill demands every platform run like the Mac does. Sure, you can have an app store, charge 30%, use your payment processing, go wild! But you have to also allow people to install and pay for apps in other ways.
- That is precisely what people like Tim Sweeney and David Heinemeier Hansson have been asking for in recent months. Heinemeier Hansson testified in a hearing about the bill yesterday, and had prepared remarks — which he mostly didn't get to, in favor of refuting the "nonsense" arguments against the bill — that said "the 17 lines of SB 2333 read like music. Written in a language I can understand without hiring counsel to parse it for me."
- Apple's Erik Neuenschwander made the opposite case, saying that the App Store's ability to stop malware, engender trust and make things easy is crucial. "Senate Bill 2333 threatens to destroy [the] iPhone as you know it," he said.
Before you write this off as being the efforts of one state far afield of the tech industry: don't. It's significant in and of itself that a bill like this made it to public debate, and it obviously has Apple concerned enough to send Neuenschwander, its manager of user privacy, to testify.
- Davison said after the hearing that he couldn't believe how much attention the issue had gotten: "I think it raises an awareness not just in me but in my colleagues that it is a real issue."
- He didn't sound particularly confident that it would pass, at least in this first incarnation, but said it was clear that this conversation needed to happen both in North Dakota and elsewhere.
