U.K.’s Strategic Market Status Investigations into Apple and Google
The United Kingdom’s Competition and Markets Authority (CMA) has embarked on a new journey, launching “strategic market status” (SMS) investigations into the mobile ecosystems of tech giants Apple and Google. These inquiries are an integral part of the Digital Markets, Competition and Consumers (DMCC) Act, which was passed last year and officially came into effect in January.
Understanding the DMCC Act
The DMCC Act has endowed the CMA with new powers, enabling it to designate companies as possessing strategic market status if they are deemed excessively dominant. This new authority allows the CMA to propose remedies and interventions aimed at fostering competition.
“This is a significant step towards ensuring a fair competitive environment within the digital markets,” remarked Alex Haffner, a competition partner at U.K. law firm Fladgate.
{Alex Haffner, Fladgate}
Unveiling the First SMS Investigation
The first SMS investigation was announced last week, targeting Google Search’s substantial market share, which reportedly hovers around 90%. The CMA disclosed that another investigation would follow in January. Now, it’s clear that they’re using their fresh powers to ascertain whether Apple and Google possess strategic market status within their respective mobile ecosystems. This encompasses key areas such as browsers, app stores, and operating systems.
A Closer Look at Mobile Ecosystem Dominance
Today’s announcement comes as no shock. Back in August, the CMA concluded two investigations into the mobile app ecosystems of Apple and Google, originally launched in 2021. It was clear that this was more of a temporary pause, as the CMA intended to leverage its newfound powers to address competition concerns involving these major players in the mobile services market.
A November inquiry by the CMA found that Apple’s mobile browser policies and an agreement with Google were “holding back innovation” in the U.K.
{CMA Inquiry}
Evaluating Competitive Barriers
The latest probe will scrutinize “the extent of competition between and within” Apple’s and Google’s mobile ecosystems. This includes examining barriers that might hinder others from competing effectively. The investigation will also determine if either company is exploiting their dominant positions in operating systems, app distribution, or browsers to “favor their own apps and services,” many of which are pre-installed and cannot always be removed.
- Assessing potential imposition of unfair terms on developers wishing to distribute apps via their app stores.
- Exploring methods to provide third-parties with greater access to essential functionalities.
- Facilitating easier payment for services outside of Apple’s and Google’s existing app store structures.
The Broader Context
This announcement also marks a three-week period during which relevant stakeholders are invited to submit comments as part of the investigations, with outcomes expected by October 22, 2025. Potential remedies for Apple and Google could include requiring them to offer third parties greater access to key functionalities to better compete.
“We favor a way forward that avoids stifling choice and opportunities for U.K. consumers and businesses alike,” commented Oliver Bethell, senior director for competition at Google.
{Oliver Bethell, Google}
