Apple and Google risk a formal UK investigation over their dominance of web browsers on cell phones, according to a provisional decision targeting the tech giants’ stranglehold on mobile operating systems.
Bloomberg reports that the UK’s Competition and Markets Authority (CMA) issued a statement on Friday suggesting that mobile browser markets are not working well for businesses and millions of phone users in the UK. The agency recommended investigating Apple and Google’s activities under tougher digital markets competition rules, which will come into force next year.
According to the CMA, Apple and Google can manipulate consumer choices to make their own browsers, Safari and Chrome, “the clearest or easiest option.” The regulator expressed particular concern over Apple’s mobile browser, stating that it “is holding back innovation in the browsers we use to access the web on mobile phones.”
The watchdog also highlighted the massive revenue-sharing agreement between Google and Apple, which significantly reduces financial incentives to compete in mobile browsers on Apple devices.
“Apple and Google earn significant revenue when their key rival’s mobile browser is used on iOS, reducing their financial incentives to compete,” the CMA added. “In fact, the extent of this revenue-sharing is so large that the revenue share they earn from their competitor’s product is lower but similarly significant to the revenue share they earn from their own, so that the incremental revenue from winning customers, and therefore the financial incentive to compete, is limited.”
The CMA’s move is part of a series of high-profile investigations as regulators across the globe seek to break tech monopolies and anti-competitive practices. Apple and Google are under intense scrutiny in the European Union, under the bloc’s new digital antitrust rulebook, the Digital Markets Act.
Apple is facing a potential fine over its App Store rules, while Google is under pressure to re-engineer its search services to step into line with the rules. In the U.S., the DOJ just proposed that a federal judge force Google to divest Chrome.
The new rules on digital markets will give the CMA the power to label companies as having Strategic Market Status. The agency must undertake a formal investigation to designate a firm, it said.
The probe started in 2022 after a separate study concluded that the duo has a “vice-like grip” over operating systems, app stores, and web browsers on mobile devices.
In a positive development, the watchdog will drop the investigation into cloud gaming on mobile as Apple has made changes during the investigation to allow cloud gaming apps to be sold on its App Store.
Read more at Bloomberg here.
Lucas Nolan is a reporter for Breitbart News covering issues of free speech and online censorship.
