When Apple tried this year to defeat two bills in Georgia, it sent lobbyists, threatened to shut down vital economic initiatives, and pushed the state attorney general to push for an amendment that suited Apple.
The bill that seemed to garner the most support was stopped by the Georgia House Judiciary Committee two months later. During this year's legislative session, the committee chairman did not put the bill to a vote, effectively killing him in the lower house.
Apple's unreported aggressive lobbying efforts in Georgia underline a model that has received little attention from government across the country this year: State lawmakers introduce bills that force Apple and its tech giant colleague Google to give up some control over their mobile phone application stores. Then Apple, in particular, puts great pressure on lawmakers with promises of economic investments or threats to withdraw its money, and the law has stalled.
Representative Regina Cobb, the Republican congresswoman for Arizona who campaigned for a failed App Store bill in her state Senate, said: "Apple may have been intimidating and spending a lot of money." to repeal the law. Cobb said she was studying Apple's strategy in other states. "Every state does it differently, but it all comes down to using the legislature as a weapon."
“They threw those dollars away, people saw it, and I think lawmakers are scared and say, 'I'm not touching it, I'm not going to touch it because it could have a terrible impact on me. the future. Cobb said.
State legislatures are often more flexible and adaptable than the federal government, allowing them to better resolve complex and contentious issues. But, as Apple hires major government lobbyists and focuses on blocking legislation that threatens the company's financial line, local lawmakers with limited resources are struggling to ignore Apple's firepower. in lobbying.
While Google has opposed several state-level bills, Apple has been a more aggressive and visible enemy in many states, signaling a change for a company that has long been seen as quieter in its lobbying than its competitors.
The question is how much of independent app developers' revenue should be split between Apple and Google app stores. Sponsors of the proposals say they are looking to attract app developers who will be more willing to invest in their country if favorable regulations are passed. Apple and Google generate 30% of all digital purchase revenue and prevent developers from offering users other payment options.
At least seven states are considering legislation, including Minnesota, New York, Illinois and Hawaii. Democrats and Republicans in the US House of Representatives and Senate have introduced bills to curb Apple and Google's dominance over their app stores, but such legislation faces a battle difficult in both houses on their equally divided political parties.
Apple's approach to the App Store, according to a company spokesperson, offers customers privacy and security, while providing a profitable opportunity for app developers. "This law threatens to derail this very successful approach," said a spokesperson, adding that it could stifle innovation and allow consumer fraud to flourish.
On the other, heavy goods vehicles. The regulation of app stores is actively promoted by major software companies such as Match Group and Spotify across the country. Cobb received an offer from a Match Group lobbyist in Arizona, and the App Fairness Coalition, which includes Epic Games, Match Group, and Spotify, has hired lobbyists in other states. However, even the most powerful members of the coalition lack Apple's financial resources.
Apple, the world's most valued company with a market cap of $ 2.1 trillion, has successfully managed state money in ways most businesses can't, threatening jobs and offering huge investments - tactics that prompted critics to claim they were engaging in unethical behavior. and a possible violation of state ethics laws in at least one case in a California lawsuit.
This is a particularly striking dynamic for a company with lower levels of federal public lobbying than Facebook, Google and Amazon. (Facebook and Amazon spent over $ 4.5 million on federal lobbying last quarter, while Apple spent $ 1.6 million.)
"Apple has used its power not only to deprive American consumers of new innovations and opportunities, but to silence critics and prevent discussion of these critical issues," said Megan DiMusio, CEO of Coalition for App Fairness, an industry group who has been fighting for legislation on app stores.
In Arizona and North Dakota, Apple's tough tactics gained national attention, but the strategy also worked in smaller states like Louisiana and Georgia.
When Georgian lawmakers tabled two measures against app stores in early February, Apple brought in five new lobbyists to fight the bills. In a tumultuous debate that followed the bill, Apple lobbyists warned lawmakers that, if passed, the company would abandon two major economic development projects in Georgia: a $ 25 million investment in a historic black college in Atlanta and a potential multi-billion dollar investment. . ... partnered with Kia to build autonomous vehicles at West Point. They spoke on condition of anonymity to discuss personal matters.
Apple has denied any reduction in investments. According to one of the panelists, the threats in Georgia came from lobbyists outside Apple.
Three days after the bill was introduced, the lobbyist sent an email to the attorney general's office indicating that the proposal was "promoted by our competitors." Another contacted Attorney General Chris Carr in the hallway and presented a detailed legal analysis, citing court rulings as evidence the measure could be illegal, citing statistics showing app developers in Georgia on average incur losses. lower costs. A third emailed Carr's chief of staff expressing curiosity about the "possible legal costs / impact on the state given previous trials" and "whether passing these laws would result in legal liability for the state. 'State".
Then he said, “I'm not a lawyer, so I'm sure I said it wrong.
Carra's director of external affairs Jordan Watson brought Apple's concerns to an attorney for the Georgia House of Representatives Judiciary Committee weeks after the proposals were submitted. The lawyer responded with an amendment that would weaken the law. In an email to Watson, the lawyer added, "Here is an alternative to HB 229, the App Store bill we discussed earlier this week." “I know you have received many inquiries about this. Please let me know if this revised version fixes your issues or brings new ones. "
The meeting is over and lawmakers have taken no action on the Georgia App Store bill. Carra's director of communications Katie Bird said the attorney general's office "does not take into account opinions on general legislation and we have not taken a position on these bills in accordance with this policy."
"Our staff forwarded the material they shared with our office to those in the legislature who requested it," Byrd added.
On the other hand, emails from the attorney general's office indicate pleasant interactions with Apple and officials who often contact lobbyists. Watson, an employee of Carr, wrote to lobbyist Rufus Montgomery with the account names in the subject line. "How are you, my man? And "Can you tell me what you hear?"
"Please feel free to share any information you can," Carr's chief of staff Travis Johnson wrote to Montgomery on another occasion.
Montgomery is a longtime lobbyist in Georgia with close ties to the state and experience in securing large contracts. Tyler Stevens, who works for the GOP-oriented company "Tough Government Relations" and is registered to lobby for Apple at the federal level, and Matt Koenkamp, who is registered to advocate for Apple's interests in Dakota from North, are other lobbyists. When asked why they are not registered in Georgia, they both said they did not spend enough time lobbying government agencies to meet the threshold that would require them to register in under state law.
After things related to the App Store were introduced in a separate Senate bill, the Georgia proposal could get a second chance next year. However, a lobbyist representing a leading software developer told POLITICO they didn't expect this to happen.
In North Dakota, the rules of the game were similar. The day before the Senate Committee on Industry, Business and Labor held hearings on its version of the app store legislation, Apple representatives had a private discussion with nearly all members. committee, without providing a public agenda or information about the meeting. … The group was unable to issue public notice or meeting minutes, which may constitute a violation of state ethics laws. According to the company, the committee met with Apple.
The North Dakota Senate voted against the bill soon after.
In Louisiana, Apple has actively offered to devote more resources to improving the state's education system, while forcing the state senator who pushed to drop the bill from the App Store. Louisiana-based Daryl Deschotel, who submitted one of the App Store accounts, launched ads to raise awareness that Apple and Google are strangling the App Store. Finally, he decided to close his account in May.
Deshotel said he met many Apple lobbyists at a hearing where he voted against the bill.
“I had the opportunity to talk about Louisiana at these meetings, to talk about our delays and the suffering of our communities,” Deschotel said. “In these conversations, we discovered that we share the same ideals of empowering the poor and connecting people. "
As state efforts dwindle, the federal government may be the best option for app makers. Senators Richard Blumenthal, Connecticut, Marsha Blackburn, Republic of Tennessee, and Amy Klobuchar, Minnesota, introduced legislation earlier this month requiring Apple and Google to allow developers to use other app stores and notify consumers. on lower costs on the Internet.
"As mobile technology becomes more and more important in our day-to-day lives, it becomes evident that a small number of gatekeepers control the app market, wielding tremendous power over which apps people can access," said Klobuchar, president of the Senate competition. Litigation Commission.
The chamber has also introduced accompanying legislation.
It is unclear whether the bill will be promoted, particularly in the Senate, which requires significant support from Republicans, and in the Congress session with many other pressing issues.
Cobb, a congresswoman from Arizona, expressed her "limited faith" in the ability of the federal government to move faster than the states. She is working on an outline of her legislation for the next session.
Cobb said: "Waiting is not an option." "Why would we wait and hope to put all of our eggs in the federal government basket when we know they haven't done anything yet?"
The bill that seemed to garner the most support was stopped by the Georgia House Judiciary Committee two months later. During this year's legislative session, the committee chairman did not put the bill to a vote, effectively killing him in the lower house.
Apple's unreported aggressive lobbying efforts in Georgia underline a model that has received little attention from government across the country this year: State lawmakers introduce bills that force Apple and its tech giant colleague Google to give up some control over their mobile phone application stores. Then Apple, in particular, puts great pressure on lawmakers with promises of economic investments or threats to withdraw its money, and the law has stalled.
Representative Regina Cobb, the Republican congresswoman for Arizona who campaigned for a failed App Store bill in her state Senate, said: "Apple may have been intimidating and spending a lot of money." to repeal the law. Cobb said she was studying Apple's strategy in other states. "Every state does it differently, but it all comes down to using the legislature as a weapon."
“They threw those dollars away, people saw it, and I think lawmakers are scared and say, 'I'm not touching it, I'm not going to touch it because it could have a terrible impact on me. the future. Cobb said.
State legislatures are often more flexible and adaptable than the federal government, allowing them to better resolve complex and contentious issues. But, as Apple hires major government lobbyists and focuses on blocking legislation that threatens the company's financial line, local lawmakers with limited resources are struggling to ignore Apple's firepower. in lobbying.
While Google has opposed several state-level bills, Apple has been a more aggressive and visible enemy in many states, signaling a change for a company that has long been seen as quieter in its lobbying than its competitors.
The question is how much of independent app developers' revenue should be split between Apple and Google app stores. Sponsors of the proposals say they are looking to attract app developers who will be more willing to invest in their country if favorable regulations are passed. Apple and Google generate 30% of all digital purchase revenue and prevent developers from offering users other payment options.
At least seven states are considering legislation, including Minnesota, New York, Illinois and Hawaii. Democrats and Republicans in the US House of Representatives and Senate have introduced bills to curb Apple and Google's dominance over their app stores, but such legislation faces a battle difficult in both houses on their equally divided political parties.
Apple's approach to the App Store, according to a company spokesperson, offers customers privacy and security, while providing a profitable opportunity for app developers. "This law threatens to derail this very successful approach," said a spokesperson, adding that it could stifle innovation and allow consumer fraud to flourish.
On the other, heavy goods vehicles. The regulation of app stores is actively promoted by major software companies such as Match Group and Spotify across the country. Cobb received an offer from a Match Group lobbyist in Arizona, and the App Fairness Coalition, which includes Epic Games, Match Group, and Spotify, has hired lobbyists in other states. However, even the most powerful members of the coalition lack Apple's financial resources.
Apple, the world's most valued company with a market cap of $ 2.1 trillion, has successfully managed state money in ways most businesses can't, threatening jobs and offering huge investments - tactics that prompted critics to claim they were engaging in unethical behavior. and a possible violation of state ethics laws in at least one case in a California lawsuit.
This is a particularly striking dynamic for a company with lower levels of federal public lobbying than Facebook, Google and Amazon. (Facebook and Amazon spent over $ 4.5 million on federal lobbying last quarter, while Apple spent $ 1.6 million.)
"Apple has used its power not only to deprive American consumers of new innovations and opportunities, but to silence critics and prevent discussion of these critical issues," said Megan DiMusio, CEO of Coalition for App Fairness, an industry group who has been fighting for legislation on app stores.
In Arizona and North Dakota, Apple's tough tactics gained national attention, but the strategy also worked in smaller states like Louisiana and Georgia.
When Georgian lawmakers tabled two measures against app stores in early February, Apple brought in five new lobbyists to fight the bills. In a tumultuous debate that followed the bill, Apple lobbyists warned lawmakers that, if passed, the company would abandon two major economic development projects in Georgia: a $ 25 million investment in a historic black college in Atlanta and a potential multi-billion dollar investment. . ... partnered with Kia to build autonomous vehicles at West Point. They spoke on condition of anonymity to discuss personal matters.
Apple has denied any reduction in investments. According to one of the panelists, the threats in Georgia came from lobbyists outside Apple.
Three days after the bill was introduced, the lobbyist sent an email to the attorney general's office indicating that the proposal was "promoted by our competitors." Another contacted Attorney General Chris Carr in the hallway and presented a detailed legal analysis, citing court rulings as evidence the measure could be illegal, citing statistics showing app developers in Georgia on average incur losses. lower costs. A third emailed Carr's chief of staff expressing curiosity about the "possible legal costs / impact on the state given previous trials" and "whether passing these laws would result in legal liability for the state. 'State".
Then he said, “I'm not a lawyer, so I'm sure I said it wrong.
Carra's director of external affairs Jordan Watson brought Apple's concerns to an attorney for the Georgia House of Representatives Judiciary Committee weeks after the proposals were submitted. The lawyer responded with an amendment that would weaken the law. In an email to Watson, the lawyer added, "Here is an alternative to HB 229, the App Store bill we discussed earlier this week." “I know you have received many inquiries about this. Please let me know if this revised version fixes your issues or brings new ones. "
The meeting is over and lawmakers have taken no action on the Georgia App Store bill. Carra's director of communications Katie Bird said the attorney general's office "does not take into account opinions on general legislation and we have not taken a position on these bills in accordance with this policy."
"Our staff forwarded the material they shared with our office to those in the legislature who requested it," Byrd added.
On the other hand, emails from the attorney general's office indicate pleasant interactions with Apple and officials who often contact lobbyists. Watson, an employee of Carr, wrote to lobbyist Rufus Montgomery with the account names in the subject line. "How are you, my man? And "Can you tell me what you hear?"
"Please feel free to share any information you can," Carr's chief of staff Travis Johnson wrote to Montgomery on another occasion.
Montgomery is a longtime lobbyist in Georgia with close ties to the state and experience in securing large contracts. Tyler Stevens, who works for the GOP-oriented company "Tough Government Relations" and is registered to lobby for Apple at the federal level, and Matt Koenkamp, who is registered to advocate for Apple's interests in Dakota from North, are other lobbyists. When asked why they are not registered in Georgia, they both said they did not spend enough time lobbying government agencies to meet the threshold that would require them to register in under state law.
After things related to the App Store were introduced in a separate Senate bill, the Georgia proposal could get a second chance next year. However, a lobbyist representing a leading software developer told POLITICO they didn't expect this to happen.
In North Dakota, the rules of the game were similar. The day before the Senate Committee on Industry, Business and Labor held hearings on its version of the app store legislation, Apple representatives had a private discussion with nearly all members. committee, without providing a public agenda or information about the meeting. … The group was unable to issue public notice or meeting minutes, which may constitute a violation of state ethics laws. According to the company, the committee met with Apple.
The North Dakota Senate voted against the bill soon after.
In Louisiana, Apple has actively offered to devote more resources to improving the state's education system, while forcing the state senator who pushed to drop the bill from the App Store. Louisiana-based Daryl Deschotel, who submitted one of the App Store accounts, launched ads to raise awareness that Apple and Google are strangling the App Store. Finally, he decided to close his account in May.
Deshotel said he met many Apple lobbyists at a hearing where he voted against the bill.
“I had the opportunity to talk about Louisiana at these meetings, to talk about our delays and the suffering of our communities,” Deschotel said. “In these conversations, we discovered that we share the same ideals of empowering the poor and connecting people. "
As state efforts dwindle, the federal government may be the best option for app makers. Senators Richard Blumenthal, Connecticut, Marsha Blackburn, Republic of Tennessee, and Amy Klobuchar, Minnesota, introduced legislation earlier this month requiring Apple and Google to allow developers to use other app stores and notify consumers. on lower costs on the Internet.
"As mobile technology becomes more and more important in our day-to-day lives, it becomes evident that a small number of gatekeepers control the app market, wielding tremendous power over which apps people can access," said Klobuchar, president of the Senate competition. Litigation Commission.
The chamber has also introduced accompanying legislation.
It is unclear whether the bill will be promoted, particularly in the Senate, which requires significant support from Republicans, and in the Congress session with many other pressing issues.
Cobb, a congresswoman from Arizona, expressed her "limited faith" in the ability of the federal government to move faster than the states. She is working on an outline of her legislation for the next session.
Cobb said: "Waiting is not an option." "Why would we wait and hope to put all of our eggs in the federal government basket when we know they haven't done anything yet?"
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