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If the battle with Epic Games over competitive policy in the App Store was not enough, Apple (AAPL) – Get Report is now facing another war on the antitrust front. On Friday, a group of Democrat and Republican representatives in Congress introduced a bill aimed at curbing the power of Big Tech.
On this subject, the Apple Maven discusses three important topics today:
- What is this new proposed legislation?
- How could the Cupertino company be impacted?
- How might Apple stock suffer in the foreseeable future?
Read more from the Apple Maven: Apple Stock Higher After WWDC Week: Key Drivers
What is it?
The most recent “attack” on Big Tech from the federal government’s legislature body came in the form of four proposed bills.
Two of them address the issue of companies favoring themselves against competing products and services on their platforms. Think of Amazon ranking their own offerings higher than its competitors’ on amazon.com, or Alphabet displaying their devices first on a search page.
The other two are tangentially related to the first two. One limits Big Tech’s ability to acquire companies that may compete with other vendors on their platforms. The last pertains to users’ rights and ability to transfer their own data to other, even if competing platforms.
For now, the new legislation is still in the pipeline. Before being considered for a vote on the floor of the House, the proposal would first need to clear the Judiciary Subcommittee. Between now and then, expect lobbying efforts to be deployed to slow the process down or even halt it altogether.
Risks to Apple
In my opinion, all FAAMG companies stand to lose from the proposed legislation – including Microsoft, a company that fought its own antitrust war in the 1990s, but that has remained mostly away from the spotlight this time. Which tech company might suffer most is subject to debate.
Apple would probably “feel the heat” mostly within its services segment. The company has already been accused of being too powerful a gatekeeper of the App Store, a popular application platform through which tens of millions of developers offer their products and services.
Outside the App Store,…