Overview
Introduction
On October 22, 2025, the CMA confirmed its proposed designation of both Apple and Google as firms with strategic market status (SMS) in their respective mobile platforms. This followed the designation of Google as an SMS firm in online search and search advertising on October 10.
These designations have been made under the UK's new Digital Markets Competition Regime (DMCR), which was introduced on January 1, 2025, and occur in the context of parallel actions in Europe, Japan, and the United States. No further investigations have yet been launched under the DMCR and there is a question mark over the regime’s future given the UK Government’s focus on cutting regulatory red tape in a whole of Government effort to encourage inward investment (including from US tech companies).
Effect of SMS Designation
The CMA's finding of SMS (which requires only that the firm in question has substantial and entrenched market power and a position of ‘strategic significance,’ a lower standard than the traditional antitrust notion of 'dominance') was expected in both cases.
Following designation, and subject to any potential appeals by the companies concerned, the CMA will now move to the next phase, which involves consideration of the following potential remedies:
- obligations and restrictions on the SMS firm’s conduct in the affected markets (called "conduct requirements," or 'CRs'); and
- more intrusive remedies designed to reintroduce or secure competition in the affected markets, up to and including divestiture of SMS firm business units (called "pro-competitive interventions," or 'PCIs').
Commenting on the designations in Mobile Ecosystems, the CMA's Chief Executive, Sarah Cardell, wrote:
"These designations mean the CMA can consider proportionate, targeted interventions for both Apple and Google, to ensure that consumers and businesses that rely on these companies can have confidence that they’re treated fairly."
This mirrors language adopted by the CMA Press Office in regard to Search and Search Advertising:
"This designation means the CMA can consider proportionate, targeted interventions so that UK businesses and consumers have more choice and control over how they interact with Google's search services."
These statements, together with amended road maps published earlier in the year, clearly telegraph an intention to take a restrained approach to CRs, focused on choice screens, data portability, interoperability and ranking, with a large number of additional CRs put on the long finger and the more intrusive PCIs now completely off the table.
The frontier is elsewhere…
The CMA is arriving quite late to the party, with the European Commission, the United States, and Japan already pushing ahead.
The European Union
In September 2023, the European Commission designated Google (Alphabet) as a gatekeeper in regard to online advertising and Android Mobile and Apple as a gatekeeper in regard to its AppStore. This triggered certain requirements on both companies in regard to interoperability, open access, removal of restrictive terms, and steering.
The United States
In the United States, under section 2 of the Sherman Act, with regard to Google AdTech, in April 2025, the US District Court of the Eastern District of Virginia found in favor of the Department of Justice (DOJ) but has yet to order remedies. In September 2025, the US District Court for the District of Columbia imposed a range of remedies but stopped short of requiring the divestiture of Chrome.
Japan
In April 2025, the Japanese Fair Trade Commission (JFTC) issued a cease and desist order against Google LLC in regard to breaches of its Antimonopoly Act. Google did not appeal that order and has been taking steps to address the concerns raised in regard to its activities in search.
…and the CMA watches on
The CMA made clear earlier in the summer its intention to respect interventions in other jurisdictions and focus on "the best possible outcomes for the UK in the most proportionate way possible." This followed the Government’s steer to the CMA to work to ensure that "parallel regulatory action is timely, coherent and avoids duplication where these parallel actions effectively address issues arising in markets in the UK."
In other words, not to rock the (now crowded) boat unless a clearly UK-specific harm arises.
So, what next for the DMCR?
While the Digital Markets Unit (DMU) continues to progress its investigations into Search and Mobile Ecosystems, the CMA has yet to announce a third investigation and continues to assess what future cases it will open – if any – under the DMCR.
The regime was initially intended to focus on US tech companies and the turnover thresholds (£1 billion in the UK or £20 billion worldwide) reflect that. In turn, that high bar tends to exclude most UK companies in the digital space, which are much smaller than their American counterparts. This leaves the CMA in an awkward position: the strong political signals from the UK Government are to stop singling out US tech firms (a steer it received after opening its SMS investigations into Apple and Google) and instead focus on specific UK-issues. It is therefore difficult to see any route forward for the CMA that isn’t fraught with political and reputational risk.
Other options, including taking forward recommendations from the CMA's previous market investigation into Cloud, seem problematic, not least because that sector is characterized by multiple players vying to win share and a complex tech stack that is evolving by the day. It is unclear whether intervention in that market is appropriate and what risks the CMA may run by trying to regulate firms that are still evolving in their offering and market positions. The CMA itself earlier this year acknowledged the potential for unintended consequences of interventions under the DMCR in markets that are still evolving with earlier DMCR guidance document and the CMA's prioritization principles signaling that regulating these markets would be 'high risk.'
Another option, online marketplaces, might be less controversial, but would likely also face stiff opposition from relevant players.
In the wider context, the UK Chancellor announced just this week an intention to overhaul the merger control functions of the CMA, changing its decision-making structures and potentially overhauling its voluntary regime. This introduces further uncertainty regarding the future of the DMCR and the overall strategy of the agency, even after nine months of instability, which began with the firing of its Chair in January and multiple reforms to its approaches across consumer, market, and merger enforcement still ongoing.
Please reach out to the lead author, Ronan Scanlan, or your usual Steptoe contact, if you would like to discuss the implications of the UK's actions (or those of the European Commission or US DOJ) on your business.
