Apple and Google face potential overhaul of UK mobile services over 'effective duopoly'

CMA says it plans to designate both Apple and Google as holding strategic market status

If proposed decision goes ahead the MA will have the power to compel changes to the business models of both companies to ensure a fairer marketplace for rival apps.

Tech giants Apple and Google may soon be forced to significantly alter the way their mobile platforms operate in the UK after the nation's competition watchdog deemed the two firms hold an "effective duopoly" over the smartphone ecosystem.

In a proposed decision published by the Competition and Markets Authority (CMA), the regulator said it plans to designate both Apple and Google as holding "strategic market status" (SMS) under a landmark pro-competition law passed last year.

This status gives the CMA the authority to compel changes to products and business models of companies found to wield disproportionate market power.

The investigation focuses primarily on Apple and Google's control over app stores, web browsers, and operating systems.

According to the CMA, between 90-100% of UK mobile devices run on either iOS or Android, enabling the companies to tightly control the digital distribution of apps and services.

If the proposed decision is finalised in October, Apple and Google may be required to:

Reduce in-app transaction fees, which currently reach up to 30%
Allow developers to direct users to external payment platforms outside their app stores
Increase interoperability between their services and third-party alternatives, such as digital wallets and smartwatches
Ensure fair treatment of rival apps, rather than prioritising their own pre-installed or promoted services
Open voice assistant platforms like Siri and Google Gemini to competing AI providers

CMA chief executive Sarah Cardell said the regulator's probe uncovered "opportunities for more innovation and choice," pointing specifically to increased flexibility for developers and a more competitive mobile ecosystem.

The agency is also eyeing smartphone-based AI technologies, an area rapidly evolving with significant consumer and business implications. The CMA aims to ensure a "level playing field" as Apple and Google integrate AI deeper into their platforms.

The consumer rights group Which? applauded the CMA's scrutiny.

"While these companies have driven innovation, their dominance is now causing real harm to consumers and to the businesses that depend on them," said Rocio Concha, the group's policy director.

However, not all responses were supportive.

Tim Sweeney, CEO of Epic Games, involved in a protracted legal dispute with Apple over app store practices, criticised the CMA's proposal as "surprisingly weak," particularly lamenting the lack of immediate action to enable alternative app stores.

Both Apple and Google pushed back strongly against the proposed changes, warning of unintended consequences.

"We're concerned the rules the UK is now considering would undermine the privacy and security protections that our users have come to expect," said Apple in a statement.

Oliver Bethell, Google's senior director for competition, called the CMA's move "disappointing and unwarranted."

He added it is "crucial that any new regulation is evidence-based, proportionate, and does not become a roadblock to growth in the UK."

Global crackdown

This case is one of multiple ongoing investigations into Big Tech firms by the CMA and regulators across the EU and United States.

Just last month, the CMA declared Google's dominance in online search and advertising to also meet the threshold for strategic market status.

Google currently commands over 90% of UK search activity, and the CMA is now considering options to make that market more competitive.

As the October deadline approaches, both companies have been given one month to respond to the findings before a final decision is reached. Should the regulator proceed, a public consultation will follow to determine the exact scope and timeline for the required changes.