App Store Freedom Act Demands User Choice, Bans Forced Payments: $1M Fine Per Violation

The App Store Freedom Act is a direct shot at the dominant tech giants that control both your phone’s operating system and its app marketplace. Specifically, this bill targets companies that run an app store with over 100 million U.S. users and own the underlying operating system—think the two big players in the mobile space. The core mandate is simple: these companies must open up their ecosystem, allowing users and developers to operate without being locked into proprietary payment systems or restricted from using outside apps and stores.

The End of Payment Lock-In

If you’ve ever paid for an app subscription or an in-game purchase, you know that 30% fee often charged by the platform owner. This bill aims to change that by hitting the platforms where it hurts: their payment systems. Under this Act, covered companies cannot force developers to use the company’s own in-app payment system to list their app. This is huge. For a developer, being able to use a third-party payment processor often means lower fees, which could translate to lower prices for consumers or simply more profit for the small business owner who built the app. The Act also bans “anti-steering” rules, meaning developers can’t be punished for telling you about better deals available on their own website instead of through the app store.

Your Phone, Your Defaults

For the average user, the biggest change will be choice. The bill mandates that these covered companies must let you easily pick a different, third-party app or app store to be your default choice. Imagine finally being able to use a different map app or browser as the true default without the OS constantly fighting you. This provision (SEC. 2) means that the companies can’t hide or delete third-party apps just because you chose them over the pre-installed option. For the user who wants full control over their device, this is a major win for customization and competition.

Access for Developers, But With Caveats

Developers will gain guaranteed access to the operating system’s features. The bill requires covered companies to provide timely, non-discriminatory access to any interface, hardware, or software feature of the OS that the company itself or its partners use. This is crucial for developers building complex apps, like a banking app that needs secure access to a phone’s biometric scanner. However, there’s a crucial exception: the company doesn't have to license out its intellectual property (IP) or trade secrets (SEC. 5). They can also limit features to only those that don’t involve specific licensed IP. This is where things get tricky, as the platform owner could potentially use this IP protection as a shield to deny access to cutting-edge features, claiming they are proprietary trade secrets.

Who’s Policing the New Rules?

Enforcement is serious business under this Act. The Federal Trade Commission (FTC) gets the power to treat violations as “unfair or deceptive acts,” and state attorneys general can also sue on behalf of their residents (SEC. 3). The penalties are steep: in addition to standard FTC fines, a covered company faces an additional civil penalty of up to $1,000,000 for every single violation. That kind of financial hammer ensures these companies will pay very close attention to compliance. This high-stakes enforcement means that while the FTC has 180 days to issue guidance, once that guidance drops, the clock starts ticking on massive potential fines.

The Fine Print on Support and Liability

While the bill is great for choice, it also includes a reality check regarding liability (SEC. 5). If you install a third-party app store or app in a way that bypasses the official marketplace, the covered company is not required to fix damage to your device caused by that third-party software. They also don't have to provide customer service for setting up or running those outside apps. This is a fair trade-off: more freedom means more responsibility. If you choose to go outside the official walled garden, you and the third-party developer bear the risk if something goes wrong, not the platform owner.