Apple and Google may be forced to change their mobile platforms after the UK’s competition watchdog found that current regulations could “restrict innovation and competition”.
The Competition and Markets Authority (CMA) highlighted the significant and entrenched market power of the two tech giants through their platforms.
As a result, both companies are designated with “strategic market status”, a classification for the most dominant businesses.
The decision empowers the regulator to intervene and foster more competition, which is expected to benefit both consumers and businesses.
Between 90 and 100 percent of UK mobile devices run on Apple or Google mobile platforms, according to the CMA.
It is unlikely that people will switch between these two devices and will remain Apple or Android users.
The CMA won new powers at the start of the year to clamp down on players it believes dominate digital markets.
Began research on Apple and Google’s mobile platforms, which include their operating systems, including iOS and Android, app stores, and browsers that appear on mobile phones.
Will Hayter, executive director of digital markets at the CMA, said: “Apple and Google’s mobile platforms are used by thousands of businesses across the economy to market and sell products and services to millions of customers, but platform rules may limit innovation and competition.
Taking into account the feedback received since our proposed decision, we today determined the mobile platforms of Apple and Google with a strategic market position.
Having a strategic market position means that a company has significant and entrenched market power and significant size, scale or influence in terms of its digital activity.
They must also have a turnover of more than £1bn in the UK or £25bn globally.
A separate study on Google found that the company dominates the market with its search engine services, including Chrome.
The decision, published earlier this month, was the first time the CMA had used its new powers to designate a technology company with a strategic market position.
Oliver Battle, Google’s chief competition officer, criticized the watchdog’s decision, calling it “disappointing, disproportionate and unjustified”.
He said: “The UK’s new digital markets regime was introduced with the promise of supporting growth and innovation, with the CMA stressing that its work will be highly targeted and proportionate.
“In that context, we simply see no reason to make a decision today.”
Mr Battle said there were 24,000 Android phone models from 1,300 phone manufacturers worldwide, facing “fierce competition” from iOS in the UK.
An Apple spokesperson said: “Apple faces fierce competition in every market we operate in, and we work tirelessly to create the best products, services and user experience.
“The adoption of EU legislation in the UK weakens it, leaving users with weaker privacy and security, delayed access to new features and a fragmented and less seamless experience.
“We have seen the impact of the regulations on Apple users in the EU and urge the UK not to follow the same path.”
