CMA to probe Apple and Google over mobile ecosystem dominance

A new law gives the CMA additional powers to propose remedies and improve market competition in the country.

The UK Competition and Markets Authority (CMA) has launched “strategic market status” (SMS) investigations into Apple and Google to assess the impact of their mobile ecosystems on consumers, as well as app and service developers.

The investigation was launched as a result of the Digital Markets, Competition and Consumers Act passed last year, which gives the CMA additional powers to designate dominant firms with a strategic market status in a particular digital activity. Once designated, the markets watchdog can impose requirements on the businesses, as well as intervene to ensure positive outcomes for consumers and business in the country.

Virtually all mobile devices sold in the UK come pre-installed with either Apple’s iOS or Google’s Android operating systems (OS), giving the two the ability to “exert considerable influence” over the devices’ content, services and tech developments, the watchdog said, adding that effective competition could ensure that consumers and business are treated fairly by the two companies, as well as open opportunities for businesses to innovate services for end consumers offered through the devices.

According to the CMA, the investigation, which is set to conclude by the end of October this year, will assess the nature of the competition across Apple and Google’s mobile ecosystems, including if there are barriers preventing other businesses from entering the market.

Moreover, the investigation will also look into whether the two companies are using their OS to favour their own apps and services, while also determining whether Apple and Google require app developers to sign up to “unfair” terms and conditions, it said.

The CMA said that potential conduct-changing requirements resulting from the investigations could include ordering the two tech giants to open up key functionalities needed by other apps to operate on their mobile devices or making it easier for users to download apps and pay for in-app content outside of their ecosystems.

“More competitive mobile ecosystems could foster new innovations and new opportunities across a range of services that millions of people use, be they app stores, browsers or operating systems,” said Sarah Cardell, the chief executive of the CMA.

“Better competition could also boost growth here in the UK, with businesses able to offer new and innovative types of products and services on Apple’s and Google’s platforms.”

This latest investigation follows the recent launch of a CMA investigation into Google’s search dominance and advertising practices.

Last year, the CMA closed two investigations into Apple and Google that sought to assess the potential impact of their app stores on market competition in the country.

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