Apple and Google service revenues delivered because of their monopoly across the Play and Apple Stores is surging with regulators now looking at whether these tech Companies are engaging in anti-competitive behaviour and predatory pricing.

The Australian Competition and Consumer Commission is believed to be taking a new look at the way that the two tech Companies are operating in Australia while keeping a watch on what overseas regulators are doing in markets such as Japan.

In the ACCC’s second Digital Platform Services Inquiry report the regulator claimed that Apple’s App Store and Google’s Play Store have significant market power in the distribution of mobile apps in Australia, and that measures are needed to address this.

Yesterday the Japan Fair Trade Commission claimed that there is a definite need for further regulation to prevent anti-competitive behaviour by tech platforms such as Google with their Play Store monopoly and Apple with their highly profitable Apple Store operation which is charging app developers up to 30% commission on downloads that generate revenue.

A report released by the Japanese antitrust watchdog yesterday found that the two tech giants hold a duopoly in mobile operating systems here, with the market share of Apple’s iOS at 46.6% and Google’s Android at 53.4%.

They also dominate the app store market in Australia where regulators are claiming there is “not enough competitive pressure.”

What Japanese regulators want to do is to force  Apple and Google to let users select third-party payment methods instead of forcing users to go through their own services.

Regulators in several Countries claim that the two tech Companies are charging excessive fees and that their charging methods could constitute abuse of a dominant bargaining position under Japanese antitrust law, the FTC said.

Q3 2023 service revenues at Apple, comprising iTunes, Apple Music, iCloud, Apple Pay and Apple Care, soared 6.4% year over year to a record US$20.8 billion.

Global user spending in mobile apps on Apple’s App Store and Google Play will reach US$156 billion by 2023, according to projections based on Sensor Tower Store Intelligence data. This figure represents 120 percent growth from 2018 and a compound annual growth rate (CAGR) of 16.8 percent over the next five years.

The Japanese regulators argue that Google and Apple  favour their own apps over competitors by manipulating search rankings, and that these practices would have antitrust implications. It urged them to ensure a level playing field.

Both companies denied engaging in such conduct.

The Nikki Asia reports that The European Union recently took a precautionary approach to regulation with the Digital Markets Act set to be implemented in 2023.

 

The legislation bans tech giants from discriminating against competitors on their platforms or limiting users to their own payment services.

 

Regulators elsewhere in the world have forced Apple and Google to change how they operate.

 

After South Korea passed legislation in 2021 banning app store operators from forcing developers to use their billing systems, both companies began allowing other payment methods there.

 

Google started accepting third-party payment options for nongame apps in 2022 in certain countries, including Japan, and has lowered its app store commission rates before. While such moves could lead to reduced prices for users, some observers argue that the small scale of the cuts and the fees charged by other payment methods limit the impact.