The United Kingdom’s competition regulator is investigating Apple and Google once again, with the CMA assessing the “strategic market status” of the two companies in mobile ecosystems.
The Competition and Markets Authority is launching an investigation into the mobile business, once again taking on the dominance of Apple and Google in the smartphone market. As it flexes its new powers to investigate big tech companies like Apple, it’s taking on the two companies responsible for the two biggest mobile operating systems.
According to Statcounter, iOS has 47.7% of the mobile operating system market share in the UK as of December 2024. Android is reported at 51.9%.
The CMA will be checking out whether Apple and Google have a “strategic market status” (SMS) in the mobile landscape, reports Reuters. As part of this, it will also look into the impact that Apple and Google have over users and businesses developing apps and content for the platforms.
“Strategic market status” refers to a company having considerable market power over certain digital activities. For example, if Apple is massaging the App Store’s search to minimize competition.
Under the Digital Markets, Competition, and Consumers Act of 2024, the CMA has the powers to investigate and to mandate corrective actions.
On Thursday, it announced the launch of SMS investigations into Apple and Google. In the case of Apple, this includes whether Apple has a strategic market status in mobile operating systems, native app distribution via the App Store, and in mobile browsers and browser engines.
The notice for Google is practically the same, albeit to do with Android, the Google Play Store, and Chrome and Blink.
In both instances, the CMA has invited comments from consumers, in a period running from January 24 to January 28, in a “Stage 1” activity. It intends to gather evidence until March, before engaging with Apple by April to determine potential conduct requirements for the iPhone maker.
Stage 2 will run from April until July, when it will prepare a decision on Apple’s SMS status and potential conduct requirements. A third stage from July will allow Apple to respond to the CMA’s decision, with a final deadline for the CMA’s decision notice to be issued by October 22.
The intention is to increase competition and to foster innovation across a range of services in the UK, CMA chief executive Sarah Cardell said. “Better competition could also boost growth here in the UK.”
In its statement, Apple said it believed in “thriving and dynamic markets where innovation can flourish,” with the App Store ecosystem generating hundreds of thousands of jobs in the UK. “We face competition in every segment and jurisdiction where we operate, and our focus is always the trust of our users.”
The investigation arrives shortly after the replacement of the chair of the CMA. Marcus Bokkerink has been replaced on an interim basis by Doug Gurr, the former head of Amazon UK.
Another investigation
This is far from the only action Apple has had to deal with from the CMA, as it has been the subject of many different investigations over the years.
In November, the CMA released provisional findings into a 2021 Mobile Ecosystems Market Study, determining that Apple and Google had a duopoly in mobile ecosystems. The pair were in positions to determine how browsers worked on iOS and Android, and that competition was restricted by Apple’s browser rules.
The same probe also looked into mobile cloud gaming, and how cloud gaming apps were blocked from distribution in the App Store due to restrictive rules. However, Apple changed its rules to allow cloud gaming apps to be sold, prompting the CMA to conclude it didn’t have to intervene.
At the time, the CMA warned that an investigation into mobile ecosystems should occur early in 2025, when the new digital markets competition rules come into force.
Earlier in 2024, the CMA dropped an aspect of the investigation into the App Store, since it was no longer “an administrative priority” for the organization.
Now with its SMS-designating powers and the ability to force changes to occur, the CMA has decided it’s actually worth investigating again.
Once more with feeling — and teeth
While the prospect of another investigation by the UK’s competition regulator may seem a bit much considering Apple’s almost constant regulatory pressure, there is some sense to it.
The aim of the competition regulator is, as the name implies, to ensure there is competition in the market. This is to help maintain continued innovation and competitive pricing, among other factors.
The things the CMA is investigating are practically the same as previous investigations it has carried out in recent years. That may seem redundant for a government body to do, and to a point, it is costing taxpayers money to undertake.
The main difference this time is that the CMA now has powers to actually do something with its findings.
If it determines there’s a problem with Apple and Google’s positions in the digital marketplace, the Digital Markets, Competition, and Consumers Act 2024 gives the CMA tools to tweak the market. This includes instructing SMS firms to follow steps to stop or curtail specific activities.
It can also introduce “interventions” to fix competition issues, such as requiring interoperability between services.
It’s almost certain that Apple will be given an SMS designation, due to its sheer size, its large market share in the UK, and being in a “position of strategic significance” in controlling the App Store.
The real puzzle for the CMA is determining if it needs to actually apply pressure to Apple and Google in digital markets, and the form it takes.
