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LONDON – Britain’s competition regulator on Thursday launched an investigation into mobile ecosystem giants Apple and Google to determine whether the tech titans are violating the UK’s tough new digital competition rules.
The UK’s Competition and Markets Authority said it was opening dual probes into the two US tech giants to assess their “strategic market position” in their mobile ecosystems, including operating systems, app stores and smartphone-based browsers.
The research will “examine the impact on the people who use mobile devices and the thousands of companies that develop innovative services or content, such as apps for these devices.” said the CMA.
“Apple believes in thriving and dynamic markets where innovation can thrive,” an Apple spokesperson told CNBC. “We face competition in every segment and jurisdiction in which we operate, and our focus is always on the trust of our users.”
“In the UK alone, the iOS app economy supports hundreds of thousands of jobs and enables developers big and small to reach users on a trusted platform,” added the Apple spokesperson. “We will continue to engage constructively with the CMA as work on this matter progresses.”
Oliver Bethell, Google’s chief competition officer, said the company’s Android platform “has helped expand choice, lower prices, and democratize access to smartphones and apps.”
“This is the only example of a successful and viable open source mobile operating system,” said Bethell, “which avoids stifling choices and opportunities for UK consumers and businesses, and without risking UK growth prospects.”
Later this week, the United Kingdom He replaced CMA President Marcus Bokkerink With Doug Gurr, former Amazon UK Country Manager. At the time, the official said regulators had been asked in their last meeting with the government to “remove barriers that hinder business and focus their efforts on promoting growth.”
Labor MP Dan Aldridge said by email that the CMA’s launch of the inquiry into Apple and Google was “a crucial step forward in ensuring fair competition in our digital economy”.
“Companies like Apple and Google decide which apps we get access to and how much we pay,” he said in an emailed comment Thursday. “These studies will examine these practices, because they can stifle innovation and increase prices for consumers.”
New powers
The CMA has increased regulatory powers after a new UK law, called the Digital Markets, Competition and Consumers Act or DMCC, came into force earlier this year.
DMCC seeks to prevent anti-competitive behavior in digital markets. A large company with significant market power in a particular digital activity can claim a “strategic market position”.
The CMA has the power to introduce changes to prevent potential anti-competitive behavior by any company that currently has a strategic market.
According to the regulations, almost all mobile devices sold in the UK come pre-installed with Apple’s iOS or Google’s Android operating systems, and their app stores and browsers have exclusive or leading positions on their platforms compared to alternative products and services.
Almost everyone (94%) aged 16 and over in the UK – around 56 million consumers – now has access to a mobile phone and the average Briton spends around three hours a day using a mobile device, the CMA added.
The body said it will examine three key issues, including the extent of competition between Apple and Google’s mobile ecosystems, leveraging the tech giants’ market power in other activities and potential exploitative behavior.
“More competitive mobile ecosystems can foster new innovations and opportunities across a range of services used by millions of people, whether they’re app stores, browsers or operating systems,” CMA CEO Sarah Cardell said Thursday.
“Better competition can also drive growth here in the UK, as companies can offer new and innovative types of products and services on Apple and Google’s platforms,” Cardell added.
