The UK’s Competition and Markets Authority (CMA) has announced plans to address what it perceives as an “effective duopoly” exerted by Apple and Google over mobile app platforms. The regulator’s proposed reforms aim to grant app developers the ability to guide users toward alternative payment methods outside of traditional app stores.
Currently, app developers face restrictions that hinder competition by limiting the ways customers can make purchases, with Apple and Google imposing commission fees as high as 30% on certain in-app transactions. By enabling developers to “steer” users towards different payment options, the CMA believes this could enhance competition within the mobile app market, where Apple and Google dominate the platforms used by most UK smartphone users.
Some companies, like Spotify, have already bypassed app store payment systems due to these commission fees, opting instead to direct customers to their websites. The CMA suggests that removing these barriers could expand choices for both businesses and consumers, fostering a more competitive environment.
Additionally, the watchdog is evaluating whether Apple should expand access to its near-field communication technology. This change could potentially allow developers to create alternative contactless payment solutions for iPhones. However, Apple has raised concerns, arguing that such changes might compromise user protections, including security features, privacy controls, and anti-scam measures. On the other hand, Google has noted that it has already implemented some changes to permit developers to guide users towards external payment options.
This initiative by the CMA follows its decision to designate Apple and Google as having strategic market status, which provides the regulator with enhanced authority to enforce specific rules on their business operations.