UK belatedly realises phone OS duopoly harms consumers

The UK Competition and Markets Authority has been looking into the mobile ecosystem space and has worked out that a duopoly isn’t great for competition.

There’s a slightly surreal air to the CMA announcement, as the mobile platform space has effectively been a duopoly for a decade, since the likes of Blackberry and Windows fell by the wayside. Furthermore, Google’s Android is a monopolist in the non-Apple market that accounts for the vast majority of all smartphones in the world.

Nonetheless the CMA initiated a ‘probe’ earlier this year, presumably to make sure its eyes weren’t deceiving it, and was apparently appalled to have its worst fears confirmed. ‘When someone buys a mobile device, they essentially enter either Apple’s iOS or Google’s Android ecosystem,’ it found. The more profound observation, although hardly a novel one, is that the resulting lack of platform choice allows the companies to inflict their digital products and services on their captive markets.

“Apple and Google have developed a vice-like grip over how we use mobile phones and we’re concerned that it’s causing millions of people across the UK to lose out,” said CMA Chief Exec Andrea Coscelli.

“Most people know that Apple and Google are the main players when it comes to choosing a phone. But it can be easy to forget that they set all the rules too – from determining which apps are available on their app stores, to making it difficult for us to switch to alternative browsers on our phones. This control can limit innovation and choice, and lead to higher prices – none of which is good news for users.

“Any intervention must tackle the firms’ substantial market power across the key areas of operating systems, app stores and browsers. We think that the best way to do this is through the Digital Markets Unit when it receives powers from government.”

Here are the types of intervention the CMA recommends the DMU considers:

“We want the UK to remain a place where all tech firms can thrive and this study underlines the importance of ensuring mobile app stores are fair and competitive,” said UK Tech and Digital Economy Minister Chris Philp. “Our new pro-competition regime will level the playing field between tech giants and smaller businesses and prevent abuses that could curtail growth and innovation. We are grateful for the CMA’s work to date and look forward to the final recommendations.”

This is all fairly consistent with the stuff they’re mulling in the States but, as the Epic case has shown, it’s not so easy to force these companies to loosen their grip. It’s also hard to see how the final recommendations could significantly expand on the above, but process must be followed, we suppose. The DMU was first spoken about in April of this year and seems to be a more narrowly focused clone of the CMA. We will soon find out whether it has any teeth or not.