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| UK competition watchdog to act over Apple and Google’s mobile platforms | |
| (about 1 hour later) | |
| CMA intends to force tech firms to make changes after designating them with ‘strategic market status’ | |
| A UK watchdog has said it intends to take action to open up Apple and Google’s mobile platforms to more competition to benefit consumers, businesses and app developers. | |
| The Competition and Markets Authority has proposed to designate the tech companies as having “strategic market status” – as they hold an “effective duopoly” for access on mobile devices – and now intends to force Google and Apple to make changes to their mobile platforms. | |
| The regulator said that it has published “roadmaps” for each of the tech companies and that it will take a “proportionate, pro-innovation” approach to “promote competition in digital markets while protecting UK consumers and businesses from unfair or harmful practices”. | |
| The CMA said that it will, in the first instance, focus on areas such as the tech companies’ app stores – which have been criticised by developers – to ensure a “fair and transparent” app review process, as well as making sure that smartphone users can “steer” away from app stores to make purchases. | The CMA said that it will, in the first instance, focus on areas such as the tech companies’ app stores – which have been criticised by developers – to ensure a “fair and transparent” app review process, as well as making sure that smartphone users can “steer” away from app stores to make purchases. |
| The watchdog, which launched an investigation into the US tech companies earlier this year, will also address restrictions Apple imposes on digital wallets to ensure that competing financial technology companies can compete. | The watchdog, which launched an investigation into the US tech companies earlier this year, will also address restrictions Apple imposes on digital wallets to ensure that competing financial technology companies can compete. |
| “Apple and Google’s mobile platforms are both critical to the UK economy – playing an important role in all our lives, from banking and shopping to entertainment and education,” said Sarah Cardell, the chief executive of the CMA. | “Apple and Google’s mobile platforms are both critical to the UK economy – playing an important role in all our lives, from banking and shopping to entertainment and education,” said Sarah Cardell, the chief executive of the CMA. |
| “But our investigation so far has identified opportunities for more innovation and choice. Time is of the essence: as competition agencies and courts globally take action in these markets, it’s essential the UK doesn’t fall behind.” | “But our investigation so far has identified opportunities for more innovation and choice. Time is of the essence: as competition agencies and courts globally take action in these markets, it’s essential the UK doesn’t fall behind.” |
| However, the CMA said that it does not at this stage intend to force major changes such as requiring Apple to allow alternative app stores, or making it allow alternative payment methods for in-app purchases beyond its existing payment system. | However, the CMA said that it does not at this stage intend to force major changes such as requiring Apple to allow alternative app stores, or making it allow alternative payment methods for in-app purchases beyond its existing payment system. |
| Tom Smith, a competition lawyer at Geradin Partners and a former CMA director, said that the CMA was “ducking” taking major decisions “which might draw political heat”. | Tom Smith, a competition lawyer at Geradin Partners and a former CMA director, said that the CMA was “ducking” taking major decisions “which might draw political heat”. |
| He said: “The CMA is implementing the regime in a thoughtful and authoritative way, but it is doing it more timidly than it should be. | He said: “The CMA is implementing the regime in a thoughtful and authoritative way, but it is doing it more timidly than it should be. |
| “It is proposing some useful measures that would open up competition in digital markets, but it is ducking issues that would really threaten the entrenched positions of Apple and Google, and which might therefore draw political heat. For example, they have postponed the possibility for alternative app stores to challenge the App Store’s monopoly on Apple devices.” | “It is proposing some useful measures that would open up competition in digital markets, but it is ducking issues that would really threaten the entrenched positions of Apple and Google, and which might therefore draw political heat. For example, they have postponed the possibility for alternative app stores to challenge the App Store’s monopoly on Apple devices.” |
| The UK competition watchdog announced its investigations into Apple and Google’s mobile platforms in January. | The UK competition watchdog announced its investigations into Apple and Google’s mobile platforms in January. |
| The investigation examined the tech firms’ mobile operating systems, app stores and browsers to determine whether both companies required tailor-made guidelines to regulate their behaviour. | The investigation examined the tech firms’ mobile operating systems, app stores and browsers to determine whether both companies required tailor-made guidelines to regulate their behaviour. |
| At its launch, the CMA said that virtually all smartphones sold in the UK were pre-installed with Apple’s iOS or Google’s Android operating systems, while their app stores and browsers had privileged positions on their platforms compared with third-party products and services. Apple’s Safari and Google’s Chrome dominate the mobile browser market on iPhones and Android devices respectively. | At its launch, the CMA said that virtually all smartphones sold in the UK were pre-installed with Apple’s iOS or Google’s Android operating systems, while their app stores and browsers had privileged positions on their platforms compared with third-party products and services. Apple’s Safari and Google’s Chrome dominate the mobile browser market on iPhones and Android devices respectively. |
| The CMA investigation was launched days after the appointment of Doug Gurr, the former country manager of Amazon UK, as its new chair. | The CMA investigation was launched days after the appointment of Doug Gurr, the former country manager of Amazon UK, as its new chair. |
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| The government, which has pushed for a shake-up of regulation to help kickstart UK growth, was forced to deny it was “in the pocket of big tech” after the appointment. | The government, which has pushed for a shake-up of regulation to help kickstart UK growth, was forced to deny it was “in the pocket of big tech” after the appointment. |
| Tech firms, publishers and the consumer watchdog Which? subsequently wrote to the chancellor, Rachel Reeves, raising concerns that Gurr’s appointment posed a threat to the independence of the CMA. | Tech firms, publishers and the consumer watchdog Which? subsequently wrote to the chancellor, Rachel Reeves, raising concerns that Gurr’s appointment posed a threat to the independence of the CMA. |
| Gurr has said he will make the CMA’s investigations into mergers and takeovers “simple and rapid”, and Cardell said in February that a change of strategic direction was needed. | Gurr has said he will make the CMA’s investigations into mergers and takeovers “simple and rapid”, and Cardell said in February that a change of strategic direction was needed. |
| Google said that its products are open source and offer choice, security and innovation for users. | Google said that its products are open source and offer choice, security and innovation for users. |
| “That’s why today’s announcement is disappointing and unwarranted,” said Oliver Bethell, the senior director, competition, at Google. | “That’s why today’s announcement is disappointing and unwarranted,” said Oliver Bethell, the senior director, competition, at Google. |
| Google said that in 2022 its Android operating system generated more than £9.9bn in revenue for British developers, supporting more than 457,000 jobs. | Google said that in 2022 its Android operating system generated more than £9.9bn in revenue for British developers, supporting more than 457,000 jobs. |
| “It is therefore crucial that any new regulation is evidence-based, proportionate and does not become a roadblock to growth in the UK,” Bethell said. | “It is therefore crucial that any new regulation is evidence-based, proportionate and does not become a roadblock to growth in the UK,” Bethell said. |
| Apple said it was concerned that the new rules being considered would undermine the privacy and security protections expected by its users. | Apple said it was concerned that the new rules being considered would undermine the privacy and security protections expected by its users. |