Konvoy Ventures is a thesis driven venture capital firm focused on the video gaming industry. We invest in infrastructure technology, tools, and platforms.
We focused on what two key antitrust bills could mean (if passed) for innovation in gaming
Antitrust regulation in the US has gained momentum over the past few years. This summer, two key antitrust bills - the American Choice and Innovation Online Bill and the Open App Markets Bill - will face a Senate vote. With less than a month before the summer recess, this week we will be focusing on what these bills could mean (if passed) for innovation in gaming. Please note that we will not be covering the likelihood of this legislation passing, nor will we debate factors that may influence the outcome.
Understanding the Legislation
In October of 2020, the United States House Judiciary Subcommittee on Antitrust concluded their 15 month investigation on the dominance of the US’s largest tech firms (Protocol). The investigation sought to observe and draw conclusions on the practices of who they viewed as monopolists of the time - Facebook, Google, Amazon, and Apple.
In addition to recommendations on actions specific to these companies, they also proposed a set of 5 bills, all having varying degrees of progress in Congress (Center Forward):
The Bill in this list with the most momentum is the American Choice and Innovation Online Bill, which was approved in March, 2022 to be placed on the Senate calendar to be voted on. The Open App Markets Bill was introduced in August, 2021 - one month before Epic v Apple ruling which determined that Apple was not unfairly monopolizing the mobile app space with iOS or its in-app purchasing system, but still forced Apple to remove policies banning developers from informing users about alternatives to its in-app purchase system. The Open App Markets Bill is an extension of these results and prohibits companies (Apple, Google) from requiring app developers to pay app store commissions when their users make in-app purchases.
What this Means for Mobile Gaming
In short, the biggest implication of the American Choice and Innovation Online Bill and Open App Markets Bill, if made into law, is that any app store will be forced to become an open market. More specifically, this opens the door for third-parties to offer their services to the entire mobile phone user base of Apple and Android (a disruptive change). Some examples include:
Our perspective: If the American Choice and Innovation Online Bill and Open App Markets Bill pass into law, we anticipate rapid expansion of gaming-specific mobile tools, platforms, and infrastructure verticals. Subject to lower fees, we believe developers will use the increased capital to further innovate on their products and potentially lower the price of gameplay for players. If further scrutiny of monopolistic practices of tech platforms continues and given our prediction of further consolidation in the industry, we expect a burst of rapid acquisition of smaller companies building the tools and infrastructure needed to operate industry-specific marketplaces.
We focused on what two key antitrust bills could mean (if passed) for innovation in gaming
Antitrust regulation in the US has gained momentum over the past few years. This summer, two key antitrust bills - the American Choice and Innovation Online Bill and the Open App Markets Bill - will face a Senate vote. With less than a month before the summer recess, this week we will be focusing on what these bills could mean (if passed) for innovation in gaming. Please note that we will not be covering the likelihood of this legislation passing, nor will we debate factors that may influence the outcome.
Understanding the Legislation
In October of 2020, the United States House Judiciary Subcommittee on Antitrust concluded their 15 month investigation on the dominance of the US’s largest tech firms (Protocol). The investigation sought to observe and draw conclusions on the practices of who they viewed as monopolists of the time - Facebook, Google, Amazon, and Apple.
In addition to recommendations on actions specific to these companies, they also proposed a set of 5 bills, all having varying degrees of progress in Congress (Center Forward):
The Bill in this list with the most momentum is the American Choice and Innovation Online Bill, which was approved in March, 2022 to be placed on the Senate calendar to be voted on. The Open App Markets Bill was introduced in August, 2021 - one month before Epic v Apple ruling which determined that Apple was not unfairly monopolizing the mobile app space with iOS or its in-app purchasing system, but still forced Apple to remove policies banning developers from informing users about alternatives to its in-app purchase system. The Open App Markets Bill is an extension of these results and prohibits companies (Apple, Google) from requiring app developers to pay app store commissions when their users make in-app purchases.
What this Means for Mobile Gaming
In short, the biggest implication of the American Choice and Innovation Online Bill and Open App Markets Bill, if made into law, is that any app store will be forced to become an open market. More specifically, this opens the door for third-parties to offer their services to the entire mobile phone user base of Apple and Android (a disruptive change). Some examples include:
Our perspective: If the American Choice and Innovation Online Bill and Open App Markets Bill pass into law, we anticipate rapid expansion of gaming-specific mobile tools, platforms, and infrastructure verticals. Subject to lower fees, we believe developers will use the increased capital to further innovate on their products and potentially lower the price of gameplay for players. If further scrutiny of monopolistic practices of tech platforms continues and given our prediction of further consolidation in the industry, we expect a burst of rapid acquisition of smaller companies building the tools and infrastructure needed to operate industry-specific marketplaces.
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