Apple and Google browser dominance harming consumer choice, says watchdog

The duopoly that Apple and Google hold over mobile phone browsers is causing British consumers to lose out and is dampening innovation, regulators have said.

The Competition and Markets Authority (CMA) said Apple is holding back competitors such as Mozilla and Firefox from offering new features because of restrictions built into its platform.

Apple said it had “concerns” with the report published by the watchdog.

Apple runs the Safari browser, but also runs the operating system that competing browsers have to use if they want to work on iPhones.

This forces others to use Apple’s own underlying browser engine, called WebKit, partly to mitigate against cybersecurity issues.

But it also limits the extent to which competing browsers can offer features which differentiate them from Apple’s own Safari offering, which is hindering competition, the CMA said.

The watchdog said Apple also allowed Safari to implement full-screen video almost four years before giving other browsers access to the functionality required to do so.

Apple and Google dominate the mobile device market, with the CMA noting that virtually all such devices sold in the UK come with Apple’s iOS or Google’s Android operating systems pre-installed.

The firms’ own app stores and browsers have either exclusive or leading positions on their platforms compared to third-party products and services.

A spokesman for Apple said the company “has concerns with this report and believes the remedies it discusses would undermine privacy, security and the overall user experience”.

“We face competition in every segment and jurisdiction where we operate, and our focus is always the trust of our users,” it said, flagging that consumers can choose from a variety of browsers on the App Store, and switch their default browser in the settings app.

Apple said it would “continue to engage constructively with the CMA to best address their concerns”.

The CMA has been investigating the two companies’ mobile browser offerings through an independent inquiry group.

A revenue-sharing arrangement between the two is also further reducing financial incentives to compete, the watchdog added.

Google pays Apple a significant share of the search advertising revenue earned from traffic on Safari and Chrome on its iOS.8 operating system, the CMA said.

It comes after a digital markets competition regime took effect in the UK at the start of this year, giving the UK authorities new powers to issue “conduct requirements” to tech firms that are granted strategic market status.

Firms designated with the status can have conduct requirements imposed upon them which boost competition for UK businesses and choice for consumers.

The CMA is separately examining whether the US giants should be given this status.

If they are, they could be asked to to open up access to functionality within operating systems or app stores to third-party apps.

Margot Daly, chair of the CMA’s independent inquiry group, said: “Following our in-depth investigation, we have concluded that competition between different mobile browsers is not working well, and this is holding back innovation in the UK.”