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The iPhone maker could be required to permit rivals to run separate app stores on Apple devices across Britain, after a decision from the market watchdog.

This would be a significant change to the company's infamous "closed system" where applications can only be installed from the company's App Store.

But the Competition and Markets Authority has classified both Apple and Google as having "strategic market status" - effectively saying they have a lot of power over smartphone ecosystems.

Regulatory Assessment

The regulator said the two companies "may be limiting innovation and competition".

But the regulator emphasized it did not "determine or presume misconduct" from the companies.

"Mobile applications contributes one and a half percent of the British economy and sustains around four hundred thousand positions, which is why it's essential these sectors work well for business," stated a senior official from the competition authority.

Around ninety to one hundred percent of British smartphones run on the two tech companies' operating systems, creating what the regulator calls an "effective duopoly".

Based on current data, 48.5% of British smartphone users own an Apple device - which runs Apple's iOS - with the vast majority of the rest using Google's Android.

Apple's Reaction

The CMA's investigation examined how dominant Apple and Google's own applications are versus rivals - as well as their browsers and platform software.

It is unclear what modifications the regulator will look to request, but earlier it published roadmaps detailing possible actions it could take.

These comprise mandating it to be easier for people to transition between Apple and Android phones, and for both companies to rank apps "in a fair, objective and transparent manner" in their app stores.

Apple specifically may be required to permit alternative app stores on its devices, and enable people to install apps straight from developer sites.

This would mirror comparable regulations in the EU, which previously took action against Apple for anti-competitive behaviour.

Apple warned the United Kingdom could lose access to receiving updates - as has happened in the European Union - which the company attributes to strict rules.

For instance, some AI features which have been rolled out in other parts of the world are not accessible in the European market.

"Apple encounters intense rivalry in every market where we operate, and we work tirelessly to create the finest offerings, services and user experience," the company said in a release.

"The UK's adoption of European regulations would undermine that, resulting in consumers with weaker privacy and security, delayed access to latest functions, and a divided, more complicated user journey."

The Search Giant's Standpoint

Google device owners can currently use alternative marketplaces - though commentators say they are not as user-friendly as the company's official Play Store.

The regulator's plan said the search company may have to "modify the interface" of downloading apps directly from websites, as well as "eliminate barriers" when using alternative app stores.

"We simply do not see the rationale for the current classification," a company policy executive stated.

The representative said "most" of Google device owners use alternative app stores or download apps directly from a creator's site, and asserted there is a far greater range of apps offered for Android users compared to those on Apple devices.

"There are now twenty-four thousand Android phone models from thirteen hundred phone manufacturers globally, facing strong rivalry from iOS in the United Kingdom," the representative continued.

Android is an open-source operating system, which means developers can utilize and develop on top of it for free.

The company argues this means it promotes market competition.

But consumer groups said restrictions on these companies' power in other countries "currently assist enterprises to innovate and providing consumers more options".

"The companies' control is now creating genuine problems by limiting options for users and market rivalry for businesses," stated a policy expert.