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Smaller app rivals are organizing a coalition to combat Apple and Google

SAN FRANCISCO – For months, complaints from tech companies about the power of Apple and Google have been growing louder.

Spotify, the music streaming app, criticized Apple for the rules imposed in the App Store. A founder of the software company Basecamp attacked Apple's "highway robberies" for apps. And last month, Epic Games, makers of the popular game Fortnite, sued Apple and Google, claiming they had violated antitrust rules.

Now these app makers are uniting in an unusual demonstration of the opposition to Apple and Google and the power they have over their app stores. On Thursday, the smaller companies announced that they had founded the Coalition for App Fairness, a nonprofit group that aims to drive changes in app stores and "protect the app economy." The 13 first members include Spotify, Basecamp, Epic and Match Group with apps like Tinder and Hinge.

"They decided together," We're not alone here, and maybe we should stand up for everyone, "said Sarah Maxwell, a spokeswoman for the group, adding that the new nonprofit would be" a voice for many. "

The examination of the largest technology companies has reached a new intensity. The Justice Department is expected to file antitrust proceedings against Google as early as next week, focusing on the company's dominance in Internet searches. In July, Congress informed the directors of Google, Apple, Amazon and Facebook about their practices in a high-profile antitrust hearing. In Europe, regulators have launched a formal antitrust investigation into Apple's App Store tactics and are preparing to bring antitrust lawsuits against Amazon for abuse of its online dominance.

For years, smaller rivals refused to speak out against the mammoth companies for fear of retaliation. But the growing backlash has encouraged them to take action.

Spotify and others have gotten louder. And on Monday, Epic and Apple are meeting in a virtual courtroom in Northern California to present their cases on whether to stay on the App Store for Fortnite before initiating a lawsuit over the antitrust complaint next year.

At the center of the efforts of the new alliance is the rejection of the close influence of Apple and Google on their app stores and the fate of the apps they contain. The two companies control practically all smartphones in the world through their software and the distribution of apps through their stores. Both also charge a 30 percent fee for payments within apps on their systems.

App makers have increasingly grappled with payment rules, arguing that a 30 percent fee is a tax that affects their competitiveness. In some cases, they compete with Apple and Google's own apps and their unfair advantages.

Apple has argued that its fee is standard across all online marketplaces.

On Thursday, the coalition released a list of 10 principles outlined on their website for fairer app practices. They include a more transparent process for approving apps and the right to communicate directly with their users. The overriding principle is that developers shouldn't be forced to use only the App Store publishers' payment systems.

Each member of the alliance has agreed to contribute an undisclosed membership fee to the effort.

"Apple is using its platform to give its own services an unfair advantage over competitors," said Kirsten Daru, vice president and general counsel of Tile, a start-up that makes Bluetooth tracking devices and is part of the new nonprofit. "That's bad for consumers, competition and innovation."

Ms. Daru testified to lawmakers earlier this year that Apple began making the Tile app more difficult for users to have permissions after it developed a competing feature.

Apple didn't immediately comment on the coalition; Google did not respond to a request for comment.

The coalition came together in recent months after talks between executives from Tile, Epic, Spotify and Match Group, the four companies that have come out loudest against the big tech companies, Ms. Maxwell said.

Some of the conversations came after Apple and Google booted Fortnite from their app stores last month for violating their payment rules. As Epic's battle with Apple and Google escalated, Spotify and Match Group spoke out in favor of the video game company.

Apple has argued that Epic's situation was "entirely caused by Epic itself".

The new coalition could encourage more companies to publicly voice longstanding complaints, its members said. Peter Smith, managing director of Blockchain.com, said his cryptocurrency financial firm joined the group also because it was strong in numbers.

"Can you ban us all?" he said. "I doubt it."

Apple has blocked blockchain's apps multiple times, Smith said. Some customers were so frustrated by the blockades that they posted videos of themselves wrecking iPhones with machetes.

"These app stores have grown so large that they are effective in determining which customers they can access," said Smith.

Tim Sweeney, CEO of Epic, said his company received "tremendous, tremendous amounts of communications" from app developers who supported it after the lawsuit. But many are afraid to speak publicly, he said.

"Apple and Google have endless opportunities to take revenge without this being obvious to the outside world," by slowing down apps, interpreting rules negatively or rejecting new functions, Sweeney said in an interview this week.

He said Epic had stood up for what it believed was right in the past. "But of course," he added, "it's very stressful to have a battle with two companies that are over 200 times the size of us."

Adam Satariano contributed to coverage from London.

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