The UK’s competition regulator, the Competition and Markets Authority (CMA), is aiming to dismantle the dominant hold Apple and Google have over mobile app platforms by proposing changes that could allow developers to offer alternative payment methods outside of these companies’ app stores. The current system, where both tech giants can charge up to 30% in commissions for certain in-app purchases, is seen as restrictive, limiting competition and preventing app developers from providing cheaper or more varied purchasing options for consumers.
The CMA suggests that enabling developers to guide users towards external payment options—known as “steering”—could enhance competition within the mobile app market. This market is primarily controlled by Apple and Google, whose platforms are used by most smartphone users in the UK. Companies like Spotify have already taken steps to bypass app store payments due to these high commission fees by directing customers to complete transactions on their websites. The CMA believes that removing such barriers could lead to greater choices for both businesses and consumers alike.
Furthermore, the watchdog is considering whether Apple should open up its near-field communication technology to other developers, which would allow the creation of alternative contactless payment solutions on iPhones. This move could potentially diversify the options available to users when making contactless payments but has raised concerns from Apple.
Apple has voiced its concerns over the proposed changes, arguing that they could compromise user protections, including essential security features, privacy settings, and anti-scam measures. Meanwhile, Google claims it has already implemented some modifications to permit developers to direct users towards external payment methods. The CMA’s initiative follows its classification of Apple and Google as having strategic market status, which grants the regulator enhanced authority to enforce specific rules targeting their business practices.