The U.K’s Competition and Markets Authority (CMA), has issued a report commending an in-depth investigation into Apple and Google’s dominance in the mobile web browser and app ecosystems, taking effect next year.
The inquiry, conducted under the forthcoming Digital Markets Competition and Consumers Act (DMCC), highlights concerns about anti-competitive practices by the two tech giants.
The DMCC gives the CMA the authority to designate firms with significant market power as having Strategic Market Status. This designation allows the regulator to enforce significant behavioral changes, including ending self-preferencing practices, requiring interoperability, and banning other anti-competitive behaviors.
The CMA report accuses Apple of stifling innovation by restricting rivals from giving users new features like faster webpage loading. Apple is accused of using progressive web apps (PWAs) apps that operate without requiring downloads from app stores and are not subject to app store commissions.
“This technology is not able to fully take off on iOS devices,” the watchdog said in a provisional report on its investigation into mobile browsers that it opened after an initial study concluded that Apple and Google effectively have a chokehold on “mobile ecosystems.”
Additionally, the CMA noted that Apple and Google manipulate browser options to ensure their products are the most accessible for users. A revenue-sharing agreement between the companies, which makes Google the default search engine on iPhones, was also criticized for reducing financial incentives to compete in the mobile browser market on iOS.
Margot Daly, chair of the MA’s independent inquiry group, commenting on the issue said,
“Markets work best when rival businesses are able to develop and bring innovative options to consumers. Competition between different mobile browsers is not working well, and this is holding back innovation in the U.K.”
However, Apple has pushed back against the findings, arguing that market interventions under the DMCC could undermine user privacy and hinder its ability to deliver unique, innovative technology.
“Apple believes in thriving and dynamic markets where innovation can flourish. We face competition in every segment and jurisdiction where we operate, and our focus is always the trust of our users,” an Apple spokesperson told CNBC.
The CMA’s investigation will now move forward, with interested parties invited to provide comments on the provisional findings by December 13, 2024. A final decision is expected by March 2025. Notably, the CMA has dropped an investigation into restrictions on cloud gaming services on Apple’s App Store following Apple’s decision to allow these services on its platform.
Meanwhile, search giant Google is yet to comment on the CMA’s report. Google is also facing scrutiny for not complying with DMA provisions that prevent tech giants from giving preference to their own services over rivals. The commission said it is concerned Google’s measures will result in third-party services listed on Google’s search results page not being treated “in a fair and non-discriminatory manner.”
Also, recall that earlier this month, the U.S. Justice Department asked a federal judge to require Google to sell off its Chrome browser. This comes as part of a sweeping antitrust crackdown aimed at reshaping the technology giant’s dominance in search, artificial intelligence (AI), and the Android operating system. The Justice Department’s actions stem from an August ruling by U.S. District Judge Amit Mehta, which found that Google had illegally monopolized the online search market.
Notably, Apple and Google are coming under heavy investigation after the European Commission in March 2024, said it was investigating tech giant companies for non-compliance with the Digital Markets Act.
The Digital Markets Act that took full effect in the same month, targets Big Tech “gatekeeper” companies providing “core platform services.” These companies are mandated to comply with a set of do’s and don’t, under threat of hefty financial penalties or even breaking up their businesses.
This is necessary to make the digital markets “fairer” and “more contestable” by breaking up closed tech ecosystems that lock consumers into a single company’s products or services.
