Apple and Google holding back innovation, regulator warns

The UK competition regulator has accused Apple and Google of failing to give consumers a genuine choice of mobile web browsers and recommended the US technology giants face an investigation under new digital rules that come into force next year.
The Competition and Markets Authority said on Friday that Apple was “holding back innovation in the UK” by stopping rivals from giving users new features such as faster webpage loading. Apple does this by restricting progressive web apps, which do not need to be downloaded from an app store and are not subject to app store commissions, the report said.
“This technology is not able to fully take off on iOS devices,” the regulator said in a provisional report on the investigation into mobile browsers that it opened after an initial study concluded that Apple and Google effectively have a chokehold on “mobile ecosystems”.
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The authority’s report also found that Apple and Google manipulate the choices given to mobile phone users to make their own browsers “the clearest or easiest option”.
The regulator added that the revenue-sharing deal between the two US big tech companies “significantly reduces their financial incentives” to compete in mobile browsers on Apple’s iOS operating system for iPhones.
Both companies said they will “engage constructively” with the CMA.
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Apple said it disagreed with the findings adding it was concerned that the recommendations would undermine user privacy and security.
Google said the openness of its Android mobile operating system “has helped to expand choice, reduce prices and democratise access to smartphones and apps” and that it was “committed to open platforms that empower consumers”.
As a next step, the provisional report recommended that the CMA should use its new stricter digital competition powers that start next year under the Digital Markets, Competition and Consumers Act, to investigate Apple and Google’s mobile ecosystem.
The tech companies will have the chance to respond to the CMA’s findings, with a final report due in March 2025.
Jordan Ellison, partner at Slaughter and May, the law firm, said the regulator’s report was an important test case as it planned to tackle these issues using its powers under the UK’s new digital markets regime for the first time.
“The CMA is under pressure to show that the regime can be effective but also to avoid regulatory overreach given the Starmer government’s steer to regulators to avoid undue red tape,” he said.
Another CMA report is due imminently into cloud computing, exploring the market dominance of Microsoft, Amazon Web Services and Google.
⬤ The CMA has determined that Spreadex should sell its Sporting Index business after ruling that the acquisition has created a monopoly in the UK’s licensed online sports spread betting market.
Spreadex’s acquisition of its sports-betting rival’s consumer-facing arm has come under scrutiny from the authority since completing a year ago amid concerns the merger could reduce market competition in the UK.
Both companies provide both online fixed odds betting services and online sports spread betting services to UK customers.
The CMA said an independent panel concluded that the deal effectively eliminated competition and “could lead to worse user experience, a more limited range of products and higher prices for consumers”.