Apple Lobbying Against Arizona Bill That Would Let Developers Use Third-Party Payment Options

Arizona is considering legislation that would prevent developers from being forced to use Apple's in-app purchase options, and as the bill heads to the Arizona Senate, Apple and Google are lobbying heavily against it.

As outlined by Protocol, Apple has been working against the bill since last month. Apple lobbyist Rob Didiron began fighting the legislation before it had been formally introduced, with Apple also hiring additional lobbyists and sending lawyers to Arizona.

"We went through a very difficult weekend where Apple and Google hired probably almost every lobbyist in town," said Arizona State Representative Regina Cobb, who created HB2005.

HB2005, an amendment to an 2005 Arizona bill, is designed to let app developers use third-party payment options to avoid the 15 to 30 percent cut that Apple takes from app purchases and in-app payments.

Cobb developed the bill after being approached by lobbyist Ryan O'Daniel, who represents the Coalition for App Fairness. The Coalition for App Fairness was formed in September 2020 and its members include Epic Games, Spotify, Tile, Basecamp, Blix, and other developers that have had disagreements with Apple.

In a hearing last week, Apple's chief compliance officer Kyle Andeer called HB2005 a "government mandate that Apple give away the App Store."

"This would allow billion-dollar developers to take all of the app store's value for free, even if they're selling digital goods, even if they're making millions or billions of dollars doing it. The bill is a government mandate that Apple give away the app store."

Apple in November lowered its ‌App Store‌ cut for developers making under $1 million to 15 percent, so for the majority of developers, Apple now collects 15 percent instead of 30 percent. Andeer said that 83 percent of developers pay no fees at all, as they offer free apps.

Apple last month successfully fought back against a similar bill in North Dakota, which would have paved the way for third-party app store options. The bill, which was also backed by the Coalition for App Fairness, was shot down by the North Dakota Senate.

It is not clear if HB2005 will pass in Arizona, as it is facing opposition from Arizona Democrats who do not believe that state legislature should interfere with ongoing litigation, referencing the legal battle between Apple and ‌Epic Games‌. Cobb this week plans to meet with Apple executives to "negotiate the contours of the bill."