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The iPhone maker may have to permit rivals to operate their own app stores on Apple devices across Britain, after a decision from the market watchdog.

This represents a significant change to Apple's infamous "walled garden" where apps can only be installed from its own App Store.

But the UK competition watchdog has designated both Apple and Google as having "dominant market position" - indicating they have significant control over mobile platforms.

Watchdog Assessment

The regulator said the tech firms "may be limiting innovation and competition".

But the regulator clarified it did not "find or assume wrongdoing" from the companies.

"The app economy generates 1.5% of the UK's GDP and sustains around 400,000 jobs, which is why it's essential these markets work well for enterprises," stated a senior official from the competition authority.

Approximately 90-100% of British smartphones run on Apple or Google's operating systems, creating what the regulator calls an "effective duopoly".

Based on current data, nearly half of British smartphone users use an Apple device - which runs the iOS operating system - with the vast majority of the rest using the Android OS.

The Company's Response

The regulatory probe focused on how prominent Apple and Google's own apps are compared with competitors - as well as their web applications and platform software.

It is unknown what changes the regulator will look to request, but earlier it published guidelines 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 list applications "in a fair, objective and transparent manner" in their marketplaces.

Apple particularly may be compelled to allow third-party marketplaces on its products, and let people to install apps straight from companies' websites.

This would follow comparable regulations in the European Union, which previously imposed measures against Apple for anti-competitive behaviour.

Apple warned the UK could face delays to receiving updates - as has occurred in the EU - which the company attributes to heavy regulation.

For instance, some AI capabilities which have been launched in other parts of the world are not available in the EU.

"We encounters fierce competition in every market where we operate, and we strive continuously to create the finest offerings, solutions and user experience," the company said in a release.

"The UK's adoption of EU-style rules would weaken that, leaving users with reduced data protection and safety, slower availability to latest functions, and a divided, more complicated experience."

The Search Giant's Position

Google device owners can currently use third-party app stores - though commentators say they are not as user-friendly as the company's official application marketplace.

The CMA's roadmap said Google may have to "modify the interface" of installing applications directly from websites, as well as "eliminate barriers" when using alternative app stores.

"There appears to be no the rationale for today's designation decision," a company competition lead remarked.

The representative said "the majority" of Google device owners use alternative app stores or download apps directly from a creator's site, and asserted there is a much wider selection of apps offered for Android users versus those on Apple devices.

"There are now 24,000 Android phone models from 1,300 device makers worldwide, facing strong rivalry from Apple's platform in the UK," the representative added.

Google's platform is an freely available software, which means developers can use and build on top of it for no cost.

The company argues this means it opens up competition.

But advocacy organizations said restrictions on these firms' dominance in other countries "are already helping enterprises to innovate and providing consumers more choice".

"Their dominance is now creating genuine problems by restricting choice for users and market rivalry for businesses," commented a consumer advocate.