The United Kingdom has proposed sweeping new rules that may update the way mobile app developers earn revenue, enabling them to bypass the payment systems of Apple's App Store and Google's Play Store.
This significant move is part of a broader effort by the UK's Competition and Markets Authority (CMA) to raise competition, minimise app store commissions, and give developers improved control over how they process payments.
Under the new terms, developers would be enabled to direct users to alternative payment options outside Apple's and Google's app stores, ending previous restrictions that have needed several digital purchases to be processed via the companies' proprietary billing systems.
As per CMA, these updates are particularly designed to generate a more competitive digital marketplace while offering enhanced flexibility in how they monetize their apps.
The regulator believes that enabling alternative payment methods could reduce costs for developers and ultimately benefit consumers via reduced prices or enhanced services.
Reduced fees and greater flexibility
The proposal would need both companies, including the Cupertino-based tech giant the Alphabet-owned Google to charge only "fair and reasonable" fees if developers choose to direct users to external payment platforms.
As per the regulator, those fees should remain below the commissions currently charged through the App Store and Play Store.
Developers would also be encouraged to use any savings to either minimise prices for consumers or invest in enhancing their applications.
The proposed rules represent one of the UK's strongest attempts yet to minimise the popularity of these two tech giants, which are single-handedly dominating the entire tech industry covering the iPhones and most Android devices.
Apple could be required to open NFC technology
Following the execution of the policy, third-party developers could incorporate their own contactless payment solutions into iOS applications, offering consumers with more payment choices and enabling fintech companies to compete more directly with Apple Pay.
The proposal follows the UK's designation of Apple as having Strategic Market Status (SMS) under the country's Digital Markets regime. The designation gives the CMA additional authority to introduce targeted measures aimed at increasing competition on Apple's iOS and iPadOS platforms.
Apple and Google respond
Google said it has already introduced many of the changes outlined by the CMA. The company noted that latest updates to the Play Store allow developers to direct users to alternative payment methods under revised business terms and updated fee structures.
Apple, however, has expressed strong concerns over the proposed rules. The company argues that allowing developers to send users to external payment systems could expose customers to scams, fraud, deceptive pricing practices, and weaken important protections such as parental controls.
Apple has consistently maintained that its in-app payment system provides users with a safer and more secure purchasing experience while helping prevent fraudulent transactions.
