Dame Chi Onwurah has called for tougher regulatory action against Apple and Google over what she describes as an “app tax” imposed on consumers and British technology businesses.
The Labour MP for Newcastle upon Tyne Central and West said the two companies’ dominance of the mobile ecosystem gives them enormous control over how apps are distributed and how consumers pay for digital services.
Apple and Google can charge developers commissions of up to 30 per cent on some purchases made through their app stores.
Onwurah argues that these charges are ultimately passed on to consumers while smaller developers can find themselves with little practical alternative to using the two companies’ platforms.
Research commissioned by the Coalition for App Fairness has estimated that the system costs UK consumers hundreds of millions of pounds a year.
An effective duopoly
The Competition and Markets Authority has previously described Apple and Google’s mobile platforms as an effective duopoly, with the overwhelming majority of smartphones in Britain operating through their ecosystems.
Onwurah said the issue is therefore about more than the cost of individual apps.
She argues that Britain’s ability to grow its own technology businesses depends on ensuring developers can compete fairly and are not forced to surrender a large share of their revenues simply to reach customers.
The Digital Markets, Competition and Consumers Act has given the CMA stronger powers to intervene where major technology companies hold entrenched market power.
Use the CMA’s new powers
Onwurah wants the regulator to use those powers decisively rather than relying primarily on voluntary undertakings from the companies involved.
She has also argued that stronger competition is important for Britain’s technological sovereignty, with the country increasingly dependent on a small number of overseas technology giants for essential digital infrastructure.
Her intervention follows a series of calls for stronger oversight of artificial intelligence, data use and digital markets.
Onwurah has consistently argued that Labour should be ambitious about technological innovation while ensuring that the rules governing digital markets work for consumers, entrepreneurs and British businesses.
The latest challenge to Apple and Google places competition policy firmly within that argument: Britain should welcome innovation, she says, but dominant companies should not be allowed to write the rules of the market for themselves.
