Platform Republics: How Platform Rules Shape the Content of App Licenses

Luka Nenadic will present the following paper at the Empirical Legal Studies Discussion Group:

'Contract law scholarship has analyzed the effect of defaults and mandatory provisions on contracts both theoretically and empirically. We analyze the power of defaults and mandatory provisions when these rules are set by a private party rather than the state. Using the Apple App Store as an example, we show how the platform provides default contractual terms to app developers, which they can use as the End-User License Agreement ("EULA") of their app. The app developers are allowed to customize these agreements, subject to various mandatory terms that Apple imposes.

Analyzing an extensive dataset of nearly one million apps with statistical and natural-language processing techniques, we find that over 97% of the apps retain Apple's default terms, and that apps with in-app purchases are most likely to customize their EULAs. We also find that among all EULA-customizing apps, less than 10% fully comply with Apple's mandatory rules. Many deviations from Apple's rules appear to favor the interests of developers, while some are clear mistakes. We discuss how the shift of rule-making power from the state to digital platforms affects the debate on default versus mandatory rules. Our results illuminate how platforms considerably shape contracting not only through defaults, but also through the strategic design and enforcement of mandatory rules. More broadly, they demonstrate the promises of platform contractual ecosystems as a laboratory for examining global contractual networks, opt-outs and standardization, as well as the practical bite of mandatory rules at scale.'

The Discussant will be Dr Felix Pflücke.

Tea, coffee, and brownies will be available.