Britain’s competition regulators are intensifying their crackdown upon Apple and Google. This action is a continuation of that overall goal to increase competition in the digital marketplace. The Competition and Markets Authority (CMA) recently proposed to grant U.S. tech giants a “strategic market status.” This designation would give the CMA the power to require fundamental changes to how they do business, including their app stores and mobile operating systems.
In early January, the CMA opened a competition investigation into the duopoly power enjoyed by Apple and Google. They are pin-pointing these potential gates that could block other champions from providing competing goods and services on these ecosystems. This inquiry comes from longstanding concerns. Both have incredibly vast and entrenched market power in the U.K.’s digital landscape.
The CMA’s proposal to label Apple and Google’s SMS as having substantial market power is a big deal. It gives it the authority to crack down on changes to practices that needlessly harm competition. This acquisition further illustrates how vital both companies are becoming to U.K.’s digital ecosystem. Their strategic significance is increasingly being realized.
More broadly, this analysis comes on the heels of major legal challenges to Apple and Google in Europe. In April, Apple was fined 500 million euros (approximately $587 million) by European Union regulators for violating the Digital Markets Act (DMA), a landmark law designed to address competition issues among tech companies. Google, of course, is in the midst of the EU’s 4.1 billion euro fine appeal. This penalty is related to an antitrust lawsuit that started in 2018.
She’s right that the CMA is actively investigating the app stores operated by both companies. Those platforms matter deeply — they help to define the marketplace for mobile applications and their distribution. Enforcing the rules on these ecosystems is absolutely devastating. This helps enable the little guys to flourish as they challenge the giants.
According to officials from the CMA, the use of strategic market status designation is intended to level the playing field in digital markets. They are doing the hard work every day of neutralizing the power of the big tech companies.
As this investigation unfolds, it reflects a growing trend among regulators worldwide to hold large technology firms accountable for their market behaviors. The CMA’s conclusions could reverberate far past U.K. They will determine how other countries establish guardrails on the new US-dominated tectonic players.