UK Regulators Target Apple and Google Under New Strategic Market Status Framework

UK Competition Watchdog Designates Apple and Google as Strategic Market Players

The United Kingdom’s Competition and Markets Authority (CMA) has officially designated both Apple and Google as holding Strategic Market Status (SMS) for their mobile platforms, marking a significant escalation in the country’s regulatory approach to Big Tech. This move parallels similar regulatory actions in the European Union, though the UK has developed its own terminology and framework following its departure from the EU bloc.

UK Competition Watchdog Designates Apple and Google as Strategic Market Players
Rationale Behind the Strategic Market Status Designation
Immediate Implications and Industry Response
UK’s Regulatory Journey and Implementation Challenges
Broader Context and Future Implications

While the EU uses the term “gatekeeper” to describe dominant tech firms under its Digital Markets Act, the CMA has opted for the SMS designation to identify companies with substantial and entrenched market power. The announcement confirms that Apple’s iOS and Google’s Android ecosystems now fall under this new regulatory category, potentially subjecting them to closer scrutiny and future interventions.

Rationale Behind the Strategic Market Status Designation

The CMA’s decision stems from its observation that consumers predominantly use either Apple or Android devices, creating what the regulator describes as a “duopoly” in the mobile platform market. This market concentration means businesses must develop for both platforms to reach the entire UK mobile user base, giving Apple and Google significant control over digital market access.

“Apple and Google’s mobile platforms are used by thousands of businesses right across the economy to market and sell products and services to millions of customers,” stated Will Hayter, Executive Director for Digital Markets at the CMA. “But the platforms’ rules may be limiting innovation and competition.”

The regulator reached its conclusion after consulting with over 150 stakeholders and engaging with both Apple and Google directly. However, the specific criteria used to designate Apple and Google while excluding other tech giants like Amazon and Microsoft remain undisclosed., according to recent developments

Immediate Implications and Industry Response

Despite the significant designation, the CMA emphasizes that the SMS classification “is not a finding of wrongdoing” and that no immediate changes will result from the announcement. The status does bring both companies under UK legislation that enables the CMA to consider “proportionate, targeted interventions” in the future.

Apple has responded critically to the development, arguing that the CMA’s approach “undermines the privacy and security protections our users have come to expect, hampers our ability to innovate, and forces us to give away our technology for free to foreign competitors.”

The designation represents the latest step in the UK’s evolving digital regulatory framework, which has seen repeated delays and implementation challenges since the initial proposal of a Digital Markets Unit (DMU) in 2020., as additional insights

UK’s Regulatory Journey and Implementation Challenges

The UK’s path to regulating Big Tech has been characterized by multiple delays and implementation hurdles:

2020: UK government proposes Digital Markets Unit
2021: DMU launches with 60 staff but no regulatory powers
2021: CMA initiates App Store probe
2023: DMU finally receives statutory powers
2024: CMA drops App Store investigation, citing changed priorities
2025: Strategic Market Status designation announced

This pattern of announced initiatives followed by implementation delays has raised questions about the UK’s ability to effectively regulate technology giants. The CMA’s 2021 investigation into Apple’s App Store was notably dropped in August 2024, with the regulator stating it “no longer constitutes an administrative priority.”

Broader Context and Future Implications

The UK’s approach reflects a broader global trend of increasing regulatory scrutiny of major technology platforms. While following similar principles to the EU’s Digital Markets Act, the UK’s post-Brexit regulatory independence allows for tailored approaches that may differ from European standards.

This independence has already yielded practical differences – while Apple has withheld certain iPhone features from EU users to comply with regional regulations, UK consumers have continued to access these features. However, the new SMS designation could eventually lead to similar functional limitations or requirements for UK users as well.

The CMA’s official announcement positions this as the beginning of a new regulatory phase rather than an immediate punitive action. The regulator now has the framework to develop targeted interventions addressing specific competition concerns in the mobile ecosystem.

As the UK continues to refine its digital regulatory approach, the technology industry will be watching closely to see whether the CMA can overcome its history of implementation delays and effectively exercise its new powers over companies designated with Strategic Market Status.