British Smartphone Users Pay £700m Annually Through App Tax
British consumers pay approximately £700m per year in hidden app store commissions, according to research commissioned by the Coalition for App Fairness and reported by the Daily Mail. Apple and Google maintain a 90% duopoly over UK mobile devices through the Apple App Store and Google Play Store, charging developers commissions of up to 30% on digital purchases.
The total consumer cost amounts to roughly £55 annually for a household with four smartphone users, according to the research cited by the Daily Mail. That figure exceeds the combined £468m paid in UK corporation tax by Apple and Google last year by £232m.
Mobile Duopoly Restricts Developer Pricing and Growth
Developers face strict anti-steering provisions that prevent them from informing customers about cheaper payment options outside official app stores. Apple and Google enforce these rules to protect internal profits, leaving small British developers unable to absorb the 30% fee structure.
Without alternative platforms, software creators must accept Silicon Valley terms. The Competition and Markets Authority (CMA) confirmed that Apple and Google control an effective duopoly over mobile software distribution in the UK.
Competition Authority Faces Pressure to Enforce Binding Rules
Parliament passed the Digital Markets, Competition and Consumers Act (DMCCA) in 2024 with cross-party backing to grant the CMA statutory powers over dominant technology platforms. A recent CMA consultation regarding anti-steering rules has closed, with a regulatory decision anticipated soon.
Government intervention in this proceeding will signal the new administration’s approach to technology sovereignty and market regulation. Prime Minister Keir Starmer has emphasized reducing reliance on overseas digital platforms since taking office.
Frequently Asked Questions About the UK App Store Duopoly
How much do Apple and Google charge app developers?
Both companies charge a commission of up to 30% on digital subscriptions, games, and software purchases made inside apps, regardless of production costs.
What is app store steering?
Steering is the practice where developers direct users to cheaper purchasing options outside of the primary app stores, a practice currently restricted by Apple and Google.
What legislative powers does the CMA hold?
The Digital Markets, Competition and Consumers Act (DMCCA), passed by Parliament in 2024, gives the Competition and Markets Authority statutory powers to force dominant technology platforms to change anticompetitive behaviors.
Related reading