Apple faces UK antitrust threat as regulator targets browsers

Apple faces a renewed threat in the UK, where a new report from the top antitrust regulator says both it and Google are holding back innovation in the mobile browser market. By far, most of the criticism is being leveled at Apple.

The final Competition and Markets Authority (CMA) inquiry report finds that Apple wields too much power. Not only does it determine what mobile browsers can do on its devices, which limits differentiation, but it also gives Safari greater or earlier access to key operating system functions and new WebKit features before offering them to any other browser or browser developer.

This, they claim, has a “negative impact on competition and innovation,” which means “consumers and businesses could be missing out on potential innovative features that mobile browsers can provide.”

Safari and Chrome, ‘holding back innovation’

“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,” said Margot Daly, chair of the CMA’s independent inquiry group. “The analysis set out in our report and the range of potential interventions considered to address the market issues we have identified, merits consideration by the CMA under its new powers, which have been specifically designed for digital markets.”

Some of these arguments seem moot.

For example, it seems appropriate that Apple would introduce new operating systems via its own controlled browser first, in order to maintain security while the new features are bedded in, and in that regard early access seems an acceptable thing. However, the report points out that those risks could be managed in other ways that would not involve a complete ban on other browser engines, such as by the imposition of minimum security standards on browsers that don’t use WebKit.

No change yet, but it’s coming

The report suggests a number of changes, but a lot will rest on another decision currently going through the CMA. Under new powers contained in the recently-approved Digital Markets, Competition and Consumers Act, the CMA can now declare some firms as having Strategic Market Status (SMS). A firm that receives SMS status must submit to the CMA, which can impose legally binding conduct requirements or intervene to force changes in systems.  

We don’t know whether Apple will be given SMS status — that investigation only began in January — but it seems probable, after which it can expect to be forced to engage in a range of changes in its business practices, including in mobile browsing.

It is important to note that rather than demanding immediate changes, the CMA has shunted responsibility to the wider market investigation ongoing into Apple. Presumably, this means the CMA plots a series of demanded changes that go beyond those distilled in today’s report. It also means that, for the moment, Apple can carry on as it is already.

What will Apple need to change?

As for today’s new report, some of the changes Apple might be forced to make could include being:

Required to support browser engines other than WebKit.

Forced to offer competing browsers access to key functionalities from the operating system.

Forced to provide proper support for Progressive Web Apps, as many smaller UK app developers have complained that the higher cost of native app development is holding back their business.

Required to make it possible to link to web content from within an app on iOS, enabling traffic to be directed to competing browsers. It is interesting that the CMA highlights Facebook as being a company that wants to be able to do this. I presume if it were to do so, this would utterly undermine hard-won privacy controls; it isn’t clear whether privacy could become a minimum standard required from third parties. 

Placed in position to allow Safari to become an optional choice when setting up a new iPhone. The CMA resolutely believes the default nature of Safari on new devices forms a barrier to entry to other browser vendors.

The regulator did walk back previous criticisms concerning cloud gaming on iOS devices, saying it is satisfied with recent changes Apple made to its approach.

Follow the money…

Perhaps the biggest and most expensive problem identified by the CMA is the lucrative revenue-sharing deals between Apple and Google over search traffic. The CMA says these revenues are so great that neither Apple nor Google are strongly motivated to compete. The lock-in they share, given that both Apple and Google share dominance of the smartphone market, makes it that much harder for independent browsers to thrive.

“We find both Apple’s and Google’s product design choices about when, whether and how users make certain decisions about mobile browsers, also known as ‘choice architecture,’ are making it significantly harder for users to drive competition by making active choices about their use of mobile browsers,” the report says.

This latest salvo of bad news for Apple from the UK follows hot on the heels of the UK government’s criminally shameless attempt to undermine iPhone security for people worldwide with a demand to create a secret back door into iPhone data. That decision, made in private and subject to very little public scrutiny, also affects people outside of the UK. It’s understood that Apple will protest the demand in a top secret UK court later this week — though the nature of the pernicious legislation is such that even when it does, the people actually impacted by the decision won’t get to learn about it. 

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Source:: Computer World