Apple facing UK competition probe over app store dominance
Apple is facing a competition probe in the UK over claims the way it treats app developers is “unfair and uncompetitive”.
The iPhone maker has been locked in a long-running dispute with app makers including Epic Games, the company behind hit video game Fortnite, over the cut it takes through the App Store and on in-app purchases.
A number of developers have complained that they are restricted to the App Store if they want to distribute their app on iPhones and iPads, while in-app features and upgrades are also required to go through Apple’s payment system.
The tech giant takes a 30 per cent commission on all of these transactions.
The Competition and Markets Authority (CMA) today said it will investigate whether Apple imposes unfair or anti-competitive terms on developers, resulting in users having less choice or paying higher prices for apps and add-ons.
“Millions of us use apps every day to check the weather, play a game or order a takeaway,” said CMA chief executive Andrea Coscelli.
“So, complaints that Apple is using its market position to set terms which are unfair or may restrict competition and choice — potentially causing customers to lose out when buying and using apps — warrant careful scrutiny.”
The watchdog stressed that the investigation was in its early stages and no decision had yet been made on whether Apple was breaking the law.
An Apple spokesperson said: “We believe in thriving and competitive markets where any great idea can flourish. The App Store has been an engine of success for app developers, in part because of the rigorous standards we have in place — applied fairly and equally to all developers — to protect customers from malware and to prevent rampant data collection without their consent.
“We look forward to working with the UK Competition and Markets Authority to explain how our guidelines for privacy, security and content have made the App Store a trusted marketplace for both consumers and developers.”
The probe comes amid a fierce dispute between Apple and Epic Games, which last year launched its own in-app payment system in a bid to sidestep the tech giant’s commission.
The move prompted the iPhone maker to kick Epic’s Fortnite off the app store and pull the company’s developer licence.
The game developer has since filed an EU antitrust complaint, accusing Apple of setting up a “series of carefully designed anti-competitive restrictions”.
Apple hit back at the accusations, saying its rules applied to all developers. The company has also taken a number of steps to stave off criticism, including cutting its App Store commission for smaller developers from 30 per cent to 15 per cent.
The UK’s competition probe comes amid a wider crackdown on the digital sector as the government prepares to launch a new regulatory regime on tech giants.
Apple is already facing four competition investigations in the EU, including three relating to the App Store.