CMA urged to curb Big Tech app fees pushing up prices for users
Apple and Google are facing mounting pressure from Britain’s competition watchdog over app store rules that developers say are driving up prices for consumers and making it harder for UK tech firms to compete.
The Competition and Markets Authority (CMA) is expected to decide within weeks whether to crack down on so-called “anti-steering” rules, which stop developers directing users to cheaper payment options outside Apple’s App Store and Google Play.
At the centre of the row is the commission both companies charge on in-app purchases and subscriptions, which can reach as high as 30 per cent.
Developers argue the fees effectively operate as an “app tax”, forcing firms either to absorb the cost themselves or pass it directly onto customers through higher prices.
The Coalition for App Fairness (CAF), which represents app developers and digital firms, has urged the CMA to impose binding requirements on Apple and Google rather than rely on voluntary commitments.
“Apple and Google have a stranglehold over how digital services on our phones are purchased and monetised,” said Dominic Fean, spokesperson for the Coalition for App Fairness. “The CMA has the power to stop this.”
Big test of digital competition regime
The issue is emerging as one of the clearest early tests of Britain’s new digital competition regime under the Digital Markets, Competition and Consumers Act (DMCCA), which handed the regulator expanded powers over dominant technology platforms.
Last year, the CMA designated both Apple and Google as holding “strategic market status” in mobile ecosystems, allowing it to introduce conduct requirements for their app stores and operating systems.
Yet despite identifying app payment restrictions as a major concern, the regulator has so far taken a relatively cautious approach.
Earlier this year, Apple and Google agreed to voluntary commitments around app review transparency, rankings and developer access to certain platform features. The CMA stopped short, however, of forcing changes to payment rules or commission structures.
Instead, officials said they were continuing to engage with both companies while monitoring legal developments in the EU and US.
CMA under pressure to go further
The watchdog’s approach has frustrated parts of the tech sector, where there are growing concerns the UK could end up lagging behind the EU in reining in Big Tech.
Labour MP Lewis Atkinson said: “It’d be a failure of enforcement and send a dangerous message that Britain backs down in the face of Silicon Valley pressure”.
The European Union has already taken a more aggressive line through its Digital Markets Act, fining Apple €500m (£432m) earlier this year over App Store restrictions and forcing broadr changes to payment rules across Europe.
Apple and Google, meanwhile, say their app store fees fund security and fraud prevention. Both firms also warn looser payment systems could expose users to greater privacy risks.
Apple said earlier this year it appreciated the CMA’s “constructive dialogue”, while Google said it remained “deeply committed to providing a platform where developers can thrive”.
The Information Technology and Innovation Foundation recently argued that forcing platforms to allow unrestricted external payment links could weaken incentives for investment while disproportionately benefiting the largest developers with established brands.