This is the second inquiry into Apple and Google’s hold on mobile ecosystems that the UK regulator has decided to defer to its planned work under the DMCC Act
The CMA provisionally finds that Apple and Google’s conduct in markets related to mobile browsing is harming competition
On 22 November 2024, the UK Competition and Markets Authority (CMA) published its provisional decision in its market investigation into mobile browsers and cloud gaming. The study was restarted in January 2024 following a delay due to a Competition Appeal Tribunal (CAT) judgement, and the announcement of the regulator’s findings follows the August 2024 publication of its working paper on possible remedies for the harms it identified in the market. In its provisional decision, the CMA has found that changes in the conduct of app store providers (in particular Apple), have resolved concerns with the distribution of mobile cloud gaming services and recommended that no intervention into the market be made. However, the regulator also issued its provisional decision that persistent anti-competitive conduct in the mobile browser market from dominant players (namely Apple and Google), has harmed competition and innovation. Instead of pursuing behavioural remedies, the CMA further recommends that intervention in the market occur through its new powers under the Digital Markets, Competition and Consumers (DMCC) Act. The CMA will accept comments on its provisional findings until 13 December 2024 and is expected to make a final decision by 16 March 2025.
The regulator established the two firms’ overwhelming dominance in the mobile ecosystem market alongside harms to competition and innovation
To highlight the relationship between mobile browsers and mobile operating systems, the CMA began by offering data on the make-up of the mobile browser market in the UK over the last 12 years (see Figure 1). In the past 5-10 years, Google’s Chrome and Apple’s Safari browser have come to make-up approximately 90% of the market. No competing browser has accounted for more than 10% of the market since 2020. When analysing the market shares of browsers within a given mobile operating system – such as the make-up of browser supply among iOS users – the dominance of Apple and Google was even more pronounced. The CMA reported that Safari accounts for 88% of the mobile browser market among iOS users and that Chrome accounts for 77% of the market among Android users. A similar degree of dominance was also found in the market for browser engines.
Given the overwhelming control of Google and Apple in the mobile browser and browser engine market, the CMA detailed its concerns that certain anti-competitive behaviour is harming competition, including:
Apple’s requirement for mobile browser developers to use its own browser engine, WebKit, in order to access iOS;
Apple’s limits on or delays in giving competing mobile browser developers the same access and functionality in WebKit as it gives Safari;
Apple’s limits on in-app browsing, or the ability to link to web content from within an app;
Revenue sharing agreements between Apple and Google; and
Apple and Google’s choice architecture design including the preinstallation or preset defaults of their own browsers.
The regulator also noted that this conduct served to stall or prevent innovation from competitors, including improvements in quality of service, privacy and security.
Addressing the findings under the DMCC Act
As suggested in its working paper on remedies, the CMA recommends that the competitive harms at play in this market study be addressed through its new powers under the DMCC Act. The regulator proposed that markets related to mobile ecosystems, including mobile browsers, browser engines and in-app browsing, be made priority markets for strategic market status (SMS) investigations, leading to the potential designation of Apple and Google. Though the CMA considered a number of behavioural remedies outside of the framework of the DMCC Act, it considers the flexibility and monitoring capacity offered by the law would better address the risks of distortion, circumvention, inefficient specification and lack of enforcement that behavioural remedies would entail. Given the statutory limit of nine months to complete an SMS investigation and its own commitment to prioritise these investigations based on evidence gathered through its market and enforcement functions, the CMA also believes deferring to powers under the DMCC Act would not result in a substantial delay for remedying anti-competitive conduct. This recommendation aligns with the CMA’s earlier decision to close ongoing antitrust investigations into Google and Apple’s app store services in favor of addressing concerns through the DMCC Act, suggesting the regulator is eager to embrace a shift from ex-post to ex-ante enforcement for digital markets.
