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The iPhone maker may have to permit competitors to operate separate app stores on iPhones in the UK, following a ruling from the competition regulator.

This would be a significant change to the company's well-known "closed system" where applications can only be installed from its own official marketplace.

But the UK competition watchdog has classified both Apple and Google as having "strategic market status" - effectively saying they have a lot of power over mobile platforms.

Watchdog Assessment

The regulator said the two companies "could be restricting progress and competition".

But the authority emphasized it did not "find or assume wrongdoing" from the companies.

"Mobile applications generates one and a half percent of the UK's GDP and sustains around 400,000 jobs, which is why it's essential these markets function properly for enterprises," commented a top executive from the CMA.

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

According to recent analysis, nearly half of British smartphone users own an Apple device - which runs Apple's iOS - with the vast majority of the rest using Google's Android.

The Company's Reaction

The CMA's investigation focused on how dominant Apple and Google's own apps are compared with rivals - as well as their web applications and operating systems.

It is unclear what changes the regulator will seek to implement, but earlier it published guidelines outlining possible actions it could take.

These include requiring it to be more straightforward for people to switch between iOS and Android phones, and for both companies to rank apps "fairly and openly" in their app stores.

Apple specifically may be required to permit third-party marketplaces on its products, and enable people to install apps directly from developer sites.

This would follow a similar ruling in the EU, which previously imposed measures against Apple for restrictive practices.

The technology firm cautioned the United Kingdom could face delays to getting new features - as has happened in the EU - which the company blames on heavy regulation.

For example, some AI capabilities which have been rolled out in other parts of the world are not available in the European market.

"Apple faces intense rivalry in every market where we operate, and we strive continuously to create the best products, solutions and customer interface," the company said in a statement.

"The UK's adoption of EU-style rules would undermine that, resulting in consumers with reduced data protection and security, delayed access to new features, and a fragmented, more complicated experience."

The Search Giant's Position

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

The regulator's plan said Google may have to "change the user experience" of installing applications straight from websites, as well as "eliminate barriers" when using third-party platforms.

"There appears to be no the rationale for the current classification," a company competition lead stated.

The representative said "the majority" of Google device owners use third-party platforms or install applications directly from a developer's website, and asserted there is a much wider selection of apps available for Android users compared to those on iOS products.

"Currently available are 24,000 Android phone models from 1,300 phone manufacturers worldwide, facing intense competition from Apple's platform in the UK," the representative continued.

Android is an freely available software, which means creators can use and build on top of it for no cost.

Google argues this means it promotes competition.

But consumer groups said curbs on these companies' power in different nations "are already helping businesses to develop and providing customers more choice".

"Their dominance is now creating genuine problems by limiting options for consumers and market rivalry for businesses," stated a consumer advocate.