Japan Proposes Reforms to Address Google and Apple’s Mobile OS Monopoly

Japan’s Fair Trade Commission recently released a Market Study Report on Mobile OS and Mobile App Distribution, revealing that Google and Apple hold a significant monopoly in the markets for smartphones, mobile operating systems, app stores, and smartwatches, leaving little room for competitors. To address this issue, the regulator has proposed four sets of actions aimed at promoting a healthy and fair competitive environment in the mobile ecosystem.

The first set of actions focuses on preventing self-preferencing, while also ensuring equal access for third-party developers. The regulator suggests measures such as providing equal access to OS functions and advance warning of updates for all developers, not just those working for Google’s Android and Apple’s iOS. Additionally, the report calls for access to third-party payment services for app and in-app purchases.

The second set of reforms aims at improving the portability of user data between operating systems and promoting a healthy competitive environment in the mobile OS and app markets. The report also calls for allowing third-party app stores if they meet certain security and privacy standards, which could be welcome news for companies that have been critical of the rigorous app review process maintained by Apple.

The third recommendation focuses on fairness in making and enforcing rules, calling for greater transparency and advanced notice from Apple and Google when changing rules for developers. The final recommendation promotes competition related to the formation of new ecosystems.

Japan is not alone in its efforts to regulate app stores. Several other major economies, including South Korea, Australia, India, and the European Union, have taken similar steps or are signaling their intention to do so. With change on the horizon, Google has already begun to comply with calls for third-party payment access, while Apple remains more hesitant to open its ecosystem. While the report offers no specific timeline for action, modernizing markets is a government priority in Japan, so change is likely to come.

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