After an investigation into a fraudulent system put in place by Tapjoy, a company specializing in advertising mobile games, the Federal Trade Commission (FTC) found that the environments created by the App Store and Play Store were partially responsible for these practices. Explanations.
Tapjoy accused by hundreds of thousands of users
After receiving complaints from hundreds of thousands of users, the FTC began investigating Tapjoy. The company specializing in advertising for mobile games has put in place a sophisticated system that will appeal to both advertisers and gamers: by signing up for a free trial, answering a survey or downloading an application, the latter could have various virtual rewards within their game receive.
In the same category
Apple-Hyundai deal in March for Apple Car
This system seems to be beneficial for everyone involved, but it has one major flaw: many users never received the promised rewards. As a result, some of them have shared confidential private information without ever receiving anything in return.
Democratic Commissioners Rohit Chopra and Rebecca Kelly Slaughter stated, “It appears that Tapjoy has been reinforcing bogus offers from its business associates, which led players to dangle huge rewards just to cheat them when it was time to pay. Tapjoy didn’t do much to improve the situation, even with hundreds of thousands of players complaining. It has also harmed mobile game developers who have been deprived of the advertising revenue they were entitled to. “
Despite everything, the FTC believes Tapjoy is nowhere near the only one responsible on this matter … In fact, in the eyes of regulators, it’s only a small part of the equation. According to them, the real culprits are actually Google and Apple.
For the FTC, Google and Apple are no strangers to this phenomenon
According to regulators, Apple and Google have created an environment that is putting pressure on the mobile gaming industry by imposing unsustainable taxes on them. Set at 30%, it is these taxes in particular that prompt developers to look for other monetization models that will ultimately be passed on to consumers. “By controlling the dominant app stores, these companies (Apple and Google, NLDR) can impose taxes and regulations on the mobile game industry, which generates nearly $ 70 billion annually. even before the pandemic, ”explains the FTC.
The regulators add, “By providing a platform that connects advertisers, gamers and game developers, Tapjoy enables the latter to generate advertising revenue that Apple and Google do not tax. However, this monetization model also creates opportunities for fraud. “
Remember, this isn’t the first time App Store and Play Store taxes have been called into question. In 2020 a coalition of companies was formed to protest against these taxes. They are also the reason for the lawsuit that Epic Games is bringing against the two giants. After all, they were also at the center of the United States’ massive antitrust investigation into GAFA.
In response to these new statements from the FTC, Apple referred regulators to Tim Cook’s testimony to the US Congress last year: “For the vast majority of apps in the App Store, developers keep 100% of the money they make. The only apps that incur a commission are those where the developer wins a customer on an Apple device and where the functions or services are experienced and used on an Apple device. “
For its part, Google declined to comment on the FTC allegations.