The Digital Markets, Competition and Consumers Act 2024 gives the CMA a new responsibility to promote competition in digital markets through a new digital markets competition regime. The new regime comes into force in January 2025.
Recently, the CMA investigated the mobile browser and cloud gaming markets. Its provisional findings identified significant competition concerns regarding the mobile browser market but recommended that no action should be taken in relation to cloud gaming market.
Mobile browsers
The Competition and Markets Authority's independent inquiry group has carried out an in-depth assessment of the mobile browser markets and has provisionally concluded that they are not working well for UK businesses and phone users.
The CMA started investigating following its Mobile Ecosystems Market Study in 2021, which found that a duopoly exists on mobile ecosystems, including operating systems, app stores and web browsers on mobile devices.
It appointed an inquiry group which has provisionally found that several markets relating to browsers on mobile devices are not working well. The group thinks that consumers could be missing out on new features when using mobile browsers, and that businesses are limited in their ability to reach consumers through browser apps. The CMA says that overall, this could be limiting innovation and growth in the UK. This is because mobile browser apps provide the primary gateway for consumers to access the web on their mobile devices, and hence for businesses to reach consumers with their content and products.
The group has provisionally decided that an effective and comprehensive means of addressing its provisional findings is to recommend that the CMA board prioritises investigating mobile ecosystems under the new digital markets powers in the DMCC Act. The Act gives the CMA the ability to designate firms as having Strategic Market Status (SMS) in relation to a digital activity and impose appropriate interventions. To do this, the CMA must undertake a formal investigation.
Mobile cloud gaming
The investigation has also looked at mobile cloud gaming, with around 175,000 gamers in the UK choosing cloud services that stream games directly to their phone. There is better news here. The CMA had carried out a market study in 2022 which identified concerns about blockers to the development of cloud gaming apps on iOS devices. However, since then, there have been significant rule changes and a relaxation of policies, which look to have positive implications for competition in this market. As a result, the CMA hasn't found provisional concerns in this area.
The CMA invited comments on its provisional findings by 13 December and expects to make a final decision in March 2025. We anticipate that the CMA will carry out a new investigation of mobile browsers under the DMCC Act.
