The Competition and Markets Authority (CMA) has officially designated Google’s search division as having strategic market status, a decision made in October due to the company’s substantial presence in the market. This designation truly highlights the strong, rotten, duopoly that is the Apple and Google stranglehold. Combined, they control close to or even 90-100% of all mobile devices running on their platforms in the UK.
This latest move by the CMA is part of a broader effort to examine and potentially regulate Google’s market conduct. The CMA’s executive director for digital markets, Will Hayter, emphasized the significance of a competitive app economy, noting that it generates 1.5% of the UK’s GDP and supports around 400,000 jobs. He stated, “It is crucial these markets work well for business.”
The CMA has been undertaking a proactive, months-long process to find ways to rein in Google’s monopolistic market dominance. In July, the regulator published roadmaps outlining potential interventions, indicating a clear intent to enhance competition within the digital marketplace.
Oliver Bethell, Google’s competition lead, expressed discontent with the CMA’s designation decision. He stated, “We simply do not see the rationale for today’s designation decision,” asserting that Google’s search division does not stifle competition. Bethell noted many Android users interact with third party app stores or sideload apps by downloading them directly from a developer’s website. He further claimed, “There are now 24,000 Android phone models from 1,300 phone manufacturers worldwide, facing intense competition from iOS in the UK,” suggesting a diverse range of options for consumers.
Even as Google continues to insist there is competition on its platform, the impact of its monopoly over search has been decried. Rocio Concha, director of policy and advocacy at Which?, said this showed the risks of concentrated market power. Their monopoly is no longer an academic curiosity, but is inflicting tangible harm by reducing consumer choice and business competition.
Apple has chimed in as well, engaging in the public relations defense of its market position. In a statement, Apple asserted that it faces “fierce competition in every market where we operate,” adding that it strives to create the best products and services. Apple cautioned against adopting EU-style regulations in the UK, warning that such rules could lead to “weaker privacy and security, delayed access to new features, and a fragmented, less seamless experience.”
The CMA’s decision to designate Google’s search division as having strategic market status has major implications. It’s a step in the right direction for understanding whether additional regulatory action is needed to promote competition in our increasingly digital economy. To its credit, the UK regulator seems dedicated to ensuring consumers have broad options. They’re deeply committed to making certain security and privacy are never compromised either.
Debates continue over what the appropriate regulatory environment for digital marketplaces should be. Google and Apple can no longer execute their strategies on easy mode, unaware of the incoming regulatory firepower laying in wait.