“App neutrality should be part of the net neutrality discussion”


Mark CubanAs the dust tries to settle on the recent US Court of Appeals ruling in favor of defeating the FCC’s net neutrality rules, Mark Cuban, owner of the Dallas Mavericks, Landmark Theatres, Magnolia Pictures, chairman of AXS TV and founder of Broadcast.com/AudioNet (which was sold to Yahoo! for $5.8 billion in ‘99), penned a blog via BlogMaverick warning that companies should be looking at the future of “app neutrality” as well.

Back in 2010, FCC adopted net neutrality rules requiring broadband providers to treat all Net traffic the same. Verizon challenged those rules, and on 1/14 the U.S. Court of Appeals in DC upheld the company’s challenge. Companies are now going to be able to negotiate with ISPs for certain most-favored-nation status and smaller companies that can’t afford that are going to get hurt.

Here’s Cuban’s post:

“I bet you think the mobile internet is open.  That if you write the next great mobile app there is nothing that can stop it from fulfilling its destiny.  That if you create a mobile content app that blows away Netflix there is nothing that can stop it. Wrong.

There are basically 2 doors that control the availability of apps to the vast majority of smart phones in this country.  They are owned and controlled by 2 of the largest tech companies in the world, Apple and Google.

If you want your app to reach any type of audience (yes there are other app platforms supporting phones on the margin, but they are tiny by comparison), you have to make Google and Apple happy.

You have to make them happy by the type, quality, subject matter and more of your app. You have to make them happy with your revenue model. You have to make them happy in more ways than most app developers can count.  And in reality, the good news is, they both are playing nice these days.

But, and it’s just a hypothetical, what if they stopped playing nice? What if, in order to drive up their stock prices they created their own version of a Fast Lane/Priority App Positioning for which they charged? What if Google decided to sell by bid, positions in their store like they do ads? What if Apple charged revenue minimums for them to distribute an app to their user base?  I’m not saying these or any other changes are coming but if I were a betting person I would handicap the odds that at some point in the next 2 years both companies will look towards their app stores for new sources of revenue .  What happens then?

The mobile app economy is far from open. It’s dominated by two companies.  It is in the best interest of the entire mobile eco-system to address this duopoly while we are re-examining net neutrality. What do you think?”

See the BlogMaverick post here.