UK competition watchdog begins probe into Apple and Google's total domination of the mobile landscape

Authority investigating whether duopoly is harming consumers


The UK's Competition and Markets Authority (CMA) has launched a market study into Google and Apple's duopoly of the mobile sphere, with the aim of determining whether this has resulted in reduced innovation and higher prices for consumers.

Unlike other investigations that have taken place in the US and Europe, the CMA has cast a relatively broad net, with the focus on mobile ecosystems as a whole.

While this includes the App Store and Google Play Store, the investigation's remit also encompasses the underlying operating system, as well as mobile browsers.

Additionally, the CMA seeks to determine the impact of this mobile dominance on developers who rely on Apple and Google's platforms to market their wares.

The launch of this study has followed two other investigations into the conduct of the two tech giants.

On 3 March, the CMA announced it was examining whether Apple's tight control of the App Store violated the Competition Act of 1998.

The watchdog has launched a similar investigation into Google's controversial Privacy Sandbox tool, which aims to replace traditional ad-tracking cookies with anonymised signals within Google Chrome.

In a statement, Andrea Coscelli, CEO of the CMA, said: "Apple and Google control the major gateways through which people download apps or browse the web on their mobiles – whether they want to shop, play games, stream music or watch TV. We're looking into whether this could be creating problems for consumers and the businesses that want to reach people through their phones.

"Our ongoing work into big tech has already uncovered some worrying trends and we know consumers and businesses could be harmed if they go unchecked. That's why we're pressing on with launching this study now, while we are setting up the new Digital Markets Unit, so we can hit the ground running by using the results of this work to shape future plans."

With market studies, the CMA has the power to compel individuals to attend hearings or produce relevant evidence. Although primarily intended to provide information for legislators and other government bodies, there is the possibility the Secretary of State may decide to follow up this study with a Market Intervention, which could result in enforcement action being taken.

In recent months, Apple has faced intense scrutiny over its practices within the App Store, which is the sole method for distributing third-party software on iOS.

Cupertino's refusal to allow competing software distribution methods, as well as its anti-steering measures and steep commission rates, were the focus of a high-stakes civil suit filed by Epic Games in the state of California. Judge Yvonne Gonzalez Rogers is expected to issue her ruling later this year.

In April, the European Commission issued a preliminary ruling that Apple had distorted the market for music streaming by charging competing providers up to 30 per cent on all in-app payments and subscriptions.

The same month, the Australian Competition and Consumer Commission (ACCC) published the results of its investigation into the wider app ecosystem, and urged regulators to impose new rules to address the power imbalance between Apple and Google and the developers and consumers that rely on their services.

In its report [PDF], the ACCC said it was "highly likely that the commission rates are inflated by the market power that Apple and Google have in their dealings with app developers" and suggested measures that included unbundling in-app purchase mechanisms from app stores, or compelling Apple to allow the presence of alternative marketplaces. ®

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