Antitrust whip against Apple and Google. The Giants may be forced to cut back on their dominant position

The UK Competition and Markets Authority (CMA) on Wednesday recognized Apple and Google as having “strategic market status” (SMS) due to their dominant position in the app market. In Apple's case, this may mean allowing apps from outside its App Store.

Digital regulations introduced in January this year require companies with undue influence in certain digital markets to be marked as such and subject to specific rules. Less than two weeks ago, the CMA recognized Google as an SMS in the search engine market – the first time such status was granted under the new regulations.

The CMA has already emphasized that approximately 90-100 percent of UK mobile devices run on Apple or Google mobile platforms, meaning these companies “maintain a de facto duopoly”. Recognizing both companies as SMS on Wednesday, the office stated that these companies, through their dominant position, “may limit innovation and competition.”

The CMA stressed that it had not “found or assumed improper conduct” by these companies. However, recognition as SMS means that both companies must follow a number of rules so as not to abuse their position. – The app economy generates 1.5%. Great Britain's GDP and provides approximately 400,000 jobs, which is why it's so important that these markets work well for business, said Will Hayter, CMA's executive director for digital markets.

The CMA's investigation focused on how Apple and Google's own apps rank relative to competing ones, as well as their browsers and operating systems. It is not known what changes the regulator will seek, but in July it published an action plan outlining potential measures it could take. These include a requirement to make it easier for users to switch between Apple and Android devices and a requirement for both companies to rank apps “fairly, objectively and transparently” in their app stores.

In particular, Apple, known for maintaining a “closed system” in which apps can only be downloaded from its App Store, may be required to allow alternative app stores on its devices and allow users to download programs directly from the companies' websites. This would be in line with a similar ruling by the European Union, which fined Apple in April, accusing it of anti-competitive behavior.

Both companies reacted critically to the CMA's decision. Apple said it risked harming consumers by “weakening privacy” and “delaying access to new features,” while Google called the decision “disappointing, disproportionate and unjustified.” (PAP)

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