On track: delivering the promises of the digital markets regime
Speech delivered by Will Hayter at Time to Reset: Unlocking Growth & Sovereignty Through Digital Competition (event hosted by News Media Association and Reset).
Good afternoon. Thank you to the Financial Times (FT), News Media Association (NMA) and Reset for hosting, and to Roa for the report, along with colleagues at The Institute For Public Policy Research (IPPR).
I’d like to start by pointing you in the direction of one of the most impressive British achievements on a world stage in 2026. Not, in fact, the CMA’s publisher conduct requirement, put in place in early June, which I know you’re all immediately thinking of.
No, in fact I’m referring to the British middle-distance runner Josh Kerr, who in July broke the world record for the mile, a record that had stood since the end of the last millennium, clocking an amazing 3 minutes 42 seconds.
What is the relevance of this, you might ask?
Not so much how fast he ran (although as a runner myself this felt almost superhuman to me!), but the fact that he announced his intentions months ahead of the attempt: which record he was going to break, on which date, at which event. He then single-mindedly focused on that objective, and under the pressure he himself had generated through that early announcement, came through and delivered.
The CMA’s job is not to create the sort of hype and build-up that professional sportspeople need to do.
But as I’ll explain, in implementing the digital markets competition regime and indeed in the CMA’s wider work, there are some parallels – we set out our stall previously in a range of public statements; and we are now doing exactly what we said we would do.
And while we may not be able to go at superhuman speed, we have strained every sinew to deliver impactful outcomes as fast as possible.
IPPR’s report: ‘Bottleneck Britain’
Let’s start with IPPR’s report.
Stepping back a moment, I think one area we can firmly agree on is that competition matters. And I have often thought that it gets less attention, and frankly less thoughtful attention, than it deserves – particularly when you consider the scale and breadth of the negative impact of ineffective competition. Or the potential benefits from markets that really serve the people of the UK.
Too often, where discussion of competition happens at all, it gets reduced crudely to ‘X and Y companies want to merge and Z authority wants to stop them’, or ‘Company A is taking company B to court’.
Perhaps this is unsurprising – a colourful argument or piece of litigation is a much easier story to write than a complex structural analysis of the costs of concentration, or a carefully designed, forward-looking intervention designed to keep a market contestable.
With that context in mind, reports like ‘Bottleneck Britain’ are to be welcomed. To put it mildly, there is a lot going on, in the world of tech, in the UK economy, and in people’s everyday lives. A piece of work that draws on a range of sources, including original polling, and attempts to highlight both the problems caused by unchecked market power in digital markets, and the benefits to be had from shaping those markets for better outcomes, is a helpfully more sophisticated way of considering these issues.
One aspect of the polling that caught my eye was that – despite the well-documented issues to do with access to finance and talent – both of those issues were outweighed by companies’ concerns with the market power of large digital platforms. This, as I will come on to, is increasingly seen not just as an economic issue, but one of sovereignty as well.
While I value both the intent behind the report, and much of the analysis in it, you will not be surprised to hear that I don’t agree with all of it. But rather than do a blow by blow, let me explain the approach we’ve taken, what we’ve achieved so far – and how, like Josh Kerr, we’ve followed the plan we laid out at the start.
Doing what we said we would do
I’ll start with the government’s strategic steer to the CMA. We were very clear on the role of the steer in our latest CMA strategy. The government is responsible for the overall economic policy context in which the CMA operates. It is for the government to set out the wider policy objectives to which the CMA should have regard, without undermining its operational independence.
And it is worth reading the steer carefully – parts, for example, which propose that we should be ‘swift, predictable, independent and proportionate’ in how we carry out our work, or parts that propose we use the digital regime ‘independently, flexibly, proportionately and collaboratively’.
I think it is hard to argue that you would wish a competition authority to act otherwise. I also think there are few in this room who are not in favour of ‘unlocking opportunities for growth across the UK digital economy and the wider economy’ – again, I am quoting the steer.
The IPPR report recommends a new strategic steer. That is a question for the government, and you will have seen the Secretary of State’s comments in the Times last week, in response. But the government’s broader comment in response to the report was that it ‘continues to back the CMA to use all its tools as robustly as it considers necessary to improve competition and benefit consumers, businesses and the UK economy’. We welcome that support.
So, how have we approached the regime? What did we say we would do, and have we done it?
Impact
Well, most importantly, we have always been focused on impact.
But we’ve been clear that that impact should be genuine positive impact for people in the UK. Which people do we mean?
Every woman, man and child in the country.
We mean people as employees of the hundreds of thousands of UK companies that depend on major tech firms in one way or another – content providers, whether news or otherwise, app developers, web developers, cloud customers, software customers, advertisers, partners.
We mean people as the shareholders of those companies, whether directly or through their pensions.
And we mean people as consumers, because in the end it’s consumers – all of us – who pay for every digital product or service in some form.
People pay for digital advertising, even if they’re not conscious of it when they carry out an online search. They pay for app store commission, enterprise software and cloud services – even if that might be several steps removed from the actual item they buy in a shop or online.
That focus on impact for people is at the heart of all the work we are currently doing.
In enforcing the publisher conduct requirement, we want to make sure that publishers – a term that covers a huge range of businesses, not just those in this room – get a fairer negotiation with Google. That, in turn, supports continued investment in high-quality content; and it gives people seeing their content via Google search greater clarity on what they’re being shown and how to find more.
In mobile, relevant companies range from developers with an interest in fair app distribution to fintechs wanting to offer innovative services using tap to pay via the Near Field Communication (NFC) chip. And, as we know, in the mobile context, ‘people’ includes anyone with a smartphone; anyone who wants the best range of innovative services from a range of providers – that is, the vast majority of all adults in the country.
Our investigation into Microsoft’s business software ecosystem is at a different stage, but again the interests of huge numbers of UK companies and public sector organisations are at stake, as is the UK taxpayer who ultimately funds all digital services the government procures.
Particularly as business software increasingly incorporates AI, we want to make sure competition works well. That customers can get access to the best tools in the market, can mix and match AI services from a broad range of competing suppliers. And that we can all reap the benefits of challengers innovating at incredible pace in this market.
The other backbone service, of course, is cloud, which underpins the products and digital tools that people use every day: streaming, buying products online, public services, banking and payments. While issues like multi-cloud or egress fees can seem technical or abstruse, they are factors that affect billions of pounds of expenditure by private and public sector organisations in the UK, so they really matter.
As critical services and infrastructure, cloud – and increasingly I think AI-enabled business software – are examples of areas where competition and sovereignty intersect. High concentration and lock-in here creates strategic dependencies, as well as economic consequences, for businesses and the public sector alike.
Effective competition can help the UK manage those dependencies by widening customer choice, sustaining a more diverse supplier base and keeping pressure on prices. That strengthens resilience and reduces the risks of excessive reliance on a small number of providers.
This is an area on which we have been advising government, as part of broader work on public procurement – keep an eye out in Parliament tomorrow for more on that.
Flexibility
Moving on from impact, we have always been clear about the benefits of flexibility, in service of achieving effective outcomes.
Even on the measures we have put in place so far, you can see a range of approaches, taking advantage of the flexibility built in to the UK framework. Formal strategic market status (SMS) findings and conduct requirements, commitments, actions agreed with the firms – these are all part of our toolkit and we make no apologies for using them strategically to achieve impact.
So, we have 3 formal conduct requirements in place on Google in search. We’re consulting on parallel conduct requirements on Apple and Google in mobile steering. There’s more to come, starting with NFC chip access on iOS and user choice screens in search. Again, just like Josh Kerr, we are trying to be predictable – we set out this phased plan in our search and mobile roadmaps last summer.
We agreed commitments with Apple and Google on app store review, app ranking and data use, and an interoperability process for Apple – commitments which came into force already on 1 April.
That is already yielding results: for example, developers have started using the interoperability process, and Apple will be publishing the first annual interoperability transparency report by the end of the month. Also by the end of the month, we are expecting the first set of compliance data from Apple and Google.
We saw commitments as the best route to make progress in those circumstances, particularly early in the regime with a set of relatively well understood issues that are more straightforward to address. As the regime beds in, the issues are likely to get trickier, so you should not expect us to take the same view on commitments everywhere. Like any remedy, commitments are only as good as the monitoring and enforcement of them, so please feel free to judge us on that basis.
We have a voluntary process under way with Amazon and Microsoft on cloud. That approach has already delivered impact, with the 2 firms making concrete changes to improve interoperability and multi-cloud; and we expect to see more. The formal SMS route remains a possible avenue subject to the progress the firms make.
We’re also considering cloud licensing – the outstanding issue from our cloud market investigation – as part of a wider SMS investigation into Microsoft’s business software ecosystem. Were this to result in designation, it would allow us to tackle the concern that Microsoft’s licensing practices may be undermining customer choice of cloud services, as well as allowing us to consider the need to take targeted steps so that UK businesses can benefit most from innovation and choice as AI gets embedded in business software. Incidentally, since our ex-cloud market investigation Panel Chair is quoted in the IPPR report, it is worth noting that he described this overall approach on cloud as ‘perfectly sensible and pragmatic’.
Proportionality
So, we have impact and flexibility. Next, proportionality – and again, this has been there from the very start, not least because it’s built into the Digital Markets, Competition and Consumers Act 2024. Being proportionate doesn’t mean being timid; but it means only intervening where the benefits outweigh the costs. This is crucial. SMS firms are among the most impactful global companies in history and we recognise that the rules we impose on them can have significant costs.
We don’t impose those costs lightly. And we don’t impose them to rob Peter to pay Paul. We impose them where doing so generates more positive impact for the whole economy through stronger growth and household prosperity.
Participation
The final thing we set out to do – and this really is part of what makes the UK approach so special – is to be participative. To reach constructive solutions based on extensive engagement both with SMS firms and others – rather than defaulting to an adversarial way of going about our work.
But I would like to emphasise, as I always do, that being proportionate, predictable and participative does not mean being cosy with companies on either side of a given debate.
Nor does it mean making everyone happy all of the time, amidst a series of highly polarised debates and complex evidence. You can get a sense of this in recent consultation responses.
On the Google search user choice conduct requirement, you will see some arguing that AI assistants should be able to appear on the choice screen, to reflect the changes in the way users are finding information online. Others argue they should not, on the basis that they do not deliver what consumers expect from their search engine.
In responses to the 2 draft mobile steering conduct requirements, you will see diametrically opposed views from Apple and Google on the one side and from many developers on the other. For instance, on the issue of how to set appropriate fee levels, the platforms say the only acceptable way is based on value; while many developers say value is meaningless, would be abused by the platforms, and if a fee is to be charged at all, then cost-based fees are the only way to go.
As we come to final positions on these, one way or another we should expect disagreement with where we end up. But we will continue to be pragmatic and reasonable, as we have been.
Conclusion
You’ve now heard from the person responsible for leading implementation of the digital markets competition regime. I’m looking forward to hearing from other speakers and the panels this afternoon, because I don’t purport to have a monopoly on the right answer, and am genuinely keen to get input, views, evidence and ideas from a range of sources.
We would never expect everyone to agree with what we are doing. That would be both impossible and the wrong goal to chase. Instead, we are focused on impact, and are using the flexibility of the regime, in line with the strategic steer, to deliver that positive impact, based on evidence.
If we do all that, as I know we will, we will be able to cut through those opposing views and do what is right for the UK. And in doing so – just like Josh Kerr – we are doing what we said we would do, right from the start.