The UK’s Competition and Markets Authority (CMA) is taking significant steps to address what it sees as an “effective duopoly” held by Apple and Google over mobile app platforms. The regulator has proposed measures that could enable app developers to guide users towards alternative payment methods outside the traditional app stores. Currently, these tech giants impose commissions of up to 30% on certain in-app transactions, a practice that the CMA believes stifles competition by restricting developers from offering more affordable or varied purchasing options.
The proposed changes aim to enhance competition in the mobile app market by allowing “steering,” which would grant developers greater autonomy. This could potentially open the market to more competitors, as Apple and Google currently dominate the platforms used by most smartphone users in the UK. Companies like Spotify have already circumvented app store payments due to high commission fees by directing users to their websites. The CMA suggests that removing these barriers could expand choices for both consumers and businesses.
In addition to payment options, the CMA is also exploring whether Apple should grant broader access to its near-field communication (NFC) technology. Such access would enable developers to innovate and offer alternative contactless payment solutions on iPhones, further diversifying payment methods available to users.
Apple has expressed concerns that these proposed regulatory changes might compromise user protections, including essential security features, privacy controls, and safeguards against scams. Meanwhile, Google has indicated that it has already implemented some modifications that allow developers to direct users to external payment options.
This initiative by the CMA comes on the heels of its decision to designate Apple and Google with a strategic market status. This classification provides the regulator with enhanced authority to enforce specific rules governing the business practices of these tech behemoths.