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In the Land of Trillion Dollar Goliaths | Microsoft preempts antitrust legislation with new Microsoft Store principles for PC and Xbox

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Microsoft today announced a set of best practices called the ‘Open App Store Principles’ that the company will apply to the Microsoft Store and “future game console marketplaces.” Microsoft’s move is in direct response to growing antitrust momentum to bring more competition to digital platforms like iOS, Android and their app stores. It is also meant to provide cover for their plan to acquire Activision Blizzard.

Microsoft says the Open App Store Principles “we’re adopting today will also ensure we’re providing the best possible experience for creators and customers of all sizes.” Microsoft then Windows evolution to their vision for the future of gaming, where gamers can “play any game on any device anywhere, including by streaming from the cloud.”

Microsoft sees too much friction between creators and gamers with “app store policies and practices on mobile devices restrict what and how creators can offer games and what and how gamers can play them.”

Microsoft’s Open App Store Principles make commitments in four important areas:

Quality, Safety, Security & Privacy

  1. We will enable all developers to access our app store as long as they meet reasonable and transparent standards for quality and safety.
  2. We will continue to protect the consumers and gamers who use our app store, ensuring that developers meet our standards for security.
  3. We will continue to respect the privacy of consumers in our app stores, giving them controls to manage their data and how it is used.

Accountability

  1. We will hold our own apps to the same standards we hold competing apps.
  2. We will not use any non-public information or data from our app store to compete with developers’ apps.

Fairness and Transparency

  1. We will treat apps equally in our app store without unreasonable preferencing or ranking of our apps or our business partners’ apps over others.
  2. We will be transparent about rules for promotion and marketing in our app store and apply these consistently and objectively.

Developer Choice

  1. We will not require developers in our app store to use our payment system to process in-app payments.
  2. We will not require developers in our app store to provide more favorable terms in our app store than in other app stores.
  3. We will not disadvantage developers if they choose to use a payment processing system other than ours or if they offer different terms and conditions in other app stores.
  4. We will not prevent developers from communicating directly with their customers through their apps for legitimate business purposes, such as pricing terms and product or service offerings.

Perhaps equally important, Microsoft says that they “recognize that emerging legislation will apply new rules to companies that both run an app store and control the underlying operating system like Windows.” So, Microsoft is also committing today that:

  • We will continue to enable developers to choose whether they want to deliver their apps for Windows though our app store, from someone else’s store, or “sideloaded” directly from the internet.
  • We will continue to give developers timely access to information about the interoperability interfaces for Windows that our own apps use.
  • We will enable Windows users to use alternative app stores and third-party apps, including by changing default settings in appropriate categories.

These new principles align greatly with many points antitrust regulators have been making and will likely go a long way in further adding to the platform control debate. The announcement also addresses and seeks to alleviate any concerns that Microsoft will make titles like Call of Duty an Xbox-exclusive title. Microsoft does specifically address this with “Microsoft will continue to make Call of Duty and other popular Activision Blizzard titles available on PlayStation through the term of any existing agreement with Activision. And we have committed to Sony that we will also make them available on PlayStation beyond the existing agreement and into the future so that Sony fans can continue to enjoy the games they love. We are also interested in taking similar steps to support Nintendo’s successful platform. We believe this is the right thing for the industry, for gamers and for our business.”

Console game stores and app stores are actually a lot alike and Microsoft knows this. Microsoft is quick to say “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. ” Microsoft tries to explain how consoles are not “general computing devices” but “specialized computing devices,” and attempts to make the case that its “principles” cannot be applied to Xbox since as the company says “costs are recovered later through revenue earned in the dedicated console store.”

While Microsoft tries to make the case that console platforms are different than mobile platforms, it says it will attempt to apply its business model for the Microsoft Store on Xbox by applying Principles 1-7 to the Microsoft Store on Xbox. Next, the company says they are “committed” to “closing the gap on the remaining principles over time.” We will believe that last statement when they finally implement it. Microsoft is attempting and needs to be the change it wants to see in the world, when they do that, others may follow on their own. Apple, however, will be dragged kicking and screaming into this better future of actual ‘choice.’

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