The UK’s competition watchdog will take a deep dive look into Apple and Google’s dominance of the mobile ecosystem, it said today — announcing a market study which will examine the pair’s respective smartphone platforms (iOS and Android); their app stores (App Store and Play Store); and web browsers (Safari and Chrome).
The Competition and Markets Authority (CMA) is concerned that the mobile platform giants’ “effective duopoly” in those areas might be harming consumers, it added.
The study will be wide-ranging, with the watchdog concerns about the nested gateways that are created as a result of the pair’s dominance of the mobile ecosystem — intermediating how consumers can access a variety of products, content, and services (such as music, TV and video streaming; fitness tracking, shopping, and banking, to cite some of the examples provided by the CMA).
“These products also include other technology and devices such as smart speakers, smartwatches, home security and lighting (which mobiles can connect to and control),” it went on, adding that it’s looking into whether their dominance of these pipes is “stifling competition across a range of digital markets”, saying too that it’s “concerned this could lead to reduced innovation across the sector and consumers paying higher prices for devices and apps, or for other goods and services due to higher advertising prices”.
The CMA further confirmed the deep dive will examine “any effects” of the pair’s market power over other businesses — giving the example of app developers who rely on Apple or Google to market their products to customers via their smart devices.
The watchdog already has an open investigation into Apple’s App Store, following several antitrust complaints by developers.
It is investigating Google’s planned depreciation of third-party tracking cookies, too, after complaints by adtech companies and publishers that the move could harm competition. (And just last week, the CMA said it was minded to accept a series of concessions offered by Google that would enable the regulator to stop it turning off support for cookies entirely if it believes the move will harm competition.)
The CMA said both those existing investigations are examining issues that fall within the new mobile ecosystem market study scope but that its work on the latter will be “much broader”.
It added that it will adopt a joined-up approach across all related cases — “to ensure the best outcomes for consumers and other businesses”. It’s giving itself a whole year to examine Gapple’s mobile ecosystems.
It is also soliciting feedback on any issues raised in its statement of scope — calling for responses by 26 July. The CMA added that it’s also keen to hear from app developers, via its questionnaire, by the same date.
Taking on tech giants
The watchdog has previously scrutinized the digital advertising market — and found plenty to be concerned about vis-a-vis Google’s dominance there.
That earlier market study has been feeding the UK government’s plan to reform competition rules to consider the market-deforming power of digital giants. And the CMA suggested the new market study, examining ‘Gapple’s’ mobile muscle, could similarly help shape UK-wide competition law reforms.
Last year, the UK announced its plan to set up a “pro-competition” regime for regulating Internet platforms, including establishing a dedicated Digital Markets Unit within the CMA (which got going earlier this year).
The legislation for the reform has not yet been put before parliament. Still, the government has said it wants the competition regulator to be able to “proactively shape platforms’ behavior” to avoid harmful behavior before it happens” — saying too that it supports enabling ex-ante interventions once a platform has been identified to have so-called “strategic market status”.
Germany already adopted similar reforms to its competition law (early this year), which enable proactive interventions to tackle large digital platforms with what is described as “paramount significance for competition across markets”. And its Federal Cartel Office has wasted no time in opening several proceedings to determine whether Amazon, Google, and Facebook have such a status.