The UK’s Competition and Markets Authority (CMA) closed its investigation into Google and Apple app stores on Wednesday (21 August), but new laws that would give it more power to control the dominance of big tech companies could ensure that scrutiny continues.
The UK’s competition watchdog, responsible for promoting competition and protecting consumers, has been investigating Google’s conduct in relation to the distribution of apps on Android devices, focusing in particular on rules that require certain developers to use Google Play’s billing system for in-app purchases.
The UK authority also investigated Apple’s App Store over similar concerns, focusing on whether Apple’s requirement for developers to use its own billing system was unfair. After being fined in June for breaking EU technology rules, Apple changed its policy in the EU to allow developers to communicate with customers outside the App Store.
However, the CMA closed both investigations on Wednesday “due to administrative priorities”, the UK regulator said on its website.
At the same time, it is preparing to enforce new rules on digital markets that will give it greater powers to tackle these issues and ensure fair competition.
“We have engaged with the CMA over the course of many months during their investigation. As part of this, we made a number of significant commitments to further broaden the billing options available to developers through Google Play,” a Google spokesperson told Euractiv.
“Android has always allowed flexibility and choice not found on other platforms – including multiple app stores and sideloading, and we deliver persistent and growing value to developers,” the spokesperson added.
Euractiv also reached out to Apple, but the company declined to comment.
The CMA rejected Google’s proposals for Developer-only Billing (DOB) and User Choice Billing (UCB), which aimed to give app developers more payment options. DOB would let developers use their own billing systems instead of Google Play’s, while UCB would allow users to choose different payment methods for in-app purchases.
The UK authority found these changes insufficient, as feedback from developers indicated they would still be too dependent on Google’s payment system, with ongoing high commission fees and user-unfriendly “pop-up screens” discouraging transactions.
The CMA’s focus is expected to return to app stores, including the Play Store and the App Store, Bloomberg reports.
The UK body also plans to use the new powers to address concerns about fair competition in the app ecosystem to ensure better outcomes for developers and consumers, according to The Independent.
“Once the new pro-competition digital markets regime comes into force, we’ll be able to consider applying those new powers to concerns we have already identified through our existing work,” said CMA Executive Director for Digital Markets Will Hayter.
Hayter also stressed the importance of ensuring that tech companies in the UK, including app developers, have access to a fair and competitive app ecosystem, which he says is essential to growing the sector, encouraging investment and benefiting UK consumers.
“These are all factors we are considering before launching our first investigations under the new regime,” he added.
The new rules, which form part of the Digital Markets, Competition and Consumers Act (DMCCA) and came into force in May, give the CMA more power to regulate tech giants.
The new rules give the CMA the power to designate companies as having ‘strategic market status’, impose requirements on their behaviour and levy hefty fines for non-compliance.
The CMA’s website also features an open consultation on draft regulations under the DMCCA, seeking feedback on how turnover should be estimated and how control of businesses should be determined. The open consultation closes on 10 September.
As recently as Tuesday (20 August), the CMA approved changes to Meta’s commitments on how it uses customer data in advertising.