26
Examination of witnesses
Sarah Cardell and Will Hayter.
Q1 The Chair: Good afternoon. I welcome everyone to this meeting of the Communications and Digital Committee. Today, we are revisiting a long strand of work for the committee by examining the regulation of digital markets. Last January, a new regime for managing competition issues in UK digital markets came into effect, giving the Competition and Markets Authority a substantial suite of new powers. Sarah and Will, you gave evidence to the committee at about that time, and I am very pleased to welcome you back today to give us an update on progress. Thank you for joining us.
Given the flurry of announcements that we have seen over the recent days, it would be good if we start there. Could you talk us through the key points of the announcements made in the last few days relating to investigations under the digital markets competition regime?
Sarah Cardell: We can absolutely do that. Would it be helpful to give a quick broad overview of our implementation of the regime more generally, or would you prefer to come back to that and we start with the most recent announcements?
The Chair: Start with the most recent announcements.
Sarah Cardell: Will, do you want to take those in that case?
Will Hayter: Thank you. As you say, we made two announcements in recent days as part of building momentum and delivery on the regime as a whole through the autumn. I will take them in order.
Last Friday, we announced three related steps. The first was that we proposed to designate Microsoft with strategic market status for its business software ecosystem. There are five services included in that proposed designation. They are services used by over a million customers in the public and private sectors in the UK, and around 20 million end users.
Secondly, to accompany that, we published an indicative road map, explaining the areas that we want to look at further to work out whether there are potential interventions that might be needed, subject to the final designation decision. Any such interventions would be intended to get better outcomes for UK customers in the public and private sectors.
Thirdly, accompanying that, we gave an update on the engagement that we have had in recent months with Amazon and Microsoft, through which we have been looking to reduce barriers to switching and to multicloud. The headline update there was good progress so far, with concrete steps to removing data transfer charges for switching and reducing those charges for multicloud, and having processes in place for supporting interoperability requests, as well as rolling out products to connect their data centres directly to further support multicloud and the ease of switching. Good progress, but more to be done. The firms need to continue to deliver on the steps that they have promised. We identified with them two further areas to look at, which are security across clouds and reducing friction so that applications built for portability can indeed deliver that portability. This is a progress update, with a further review from our board in the spring. That was last Friday.
Today, we have announced that we are consulting on a proposed conduct requirement on Apple, to require access to the NFC technology on iPhones on fair and effective terms. Contactless technology is widely used in the UK for payments and beyond, into things such as ID or physical access management to buildings and cars and so forth. Recent research shows that about 60% of adults use a digital wallet in the UK at the moment. Apple does provide NFC access, but we have heard widespread concerns from UK businesses that the terms on which it provides that access are not commercially viable. The particular concerns are that the fees and other terms are too onerous, and that the technical standards across platforms and across countries can make it difficult for competitors and developers to build and to compete.
The requirement we are proposing aims to address two main barriers: first, providing access on both the main technical standards to support payment and non-payment use cases; and, secondly, making sure that fees and other terms allow viable businesses to develop. In the round, we expect this to support growth in a key UK sector, fintech, and more broadly in choice and innovation for consumers.
Q2 The Chair: To go back to your point, Sarah, and thinking about the digital markets regime broadly, what do you see as the CMA’s main achievements since it came into force in January 2025?
Sarah Cardell: As you say, we were last before the committee back in January last year, at the outset of the regime. Over the subsequent 21 months, or thereabouts, implementing the regime has been an absolute priority for the CMA—for me and Will, as the lead executives, and for the CMA board. A number of our board members are directly involved as members of our decision-making sub-committees.
What has that prioritisation meant in practice? For us, it is about speed to impact. It is about making sure that we are taking action across a whole suite of areas, as Will has already touched on, where we can deliver tangible improvements for UK businesses and UK consumers who are dependent on these digital markets, with opportunities to innovate and grow in this space.
We have been very mindful as we have implemented the regime of the intent of Parliament that this is a regime that is participative. We have engaged very actively, not only with the prospective firms, and in some cases designated firms, but with a whole host of different stakeholders, UK players and internationally, that have a direct interest in these markets. That participative approach is absolutely key.
Another element is proportionality. We want to take action that is targeted, bespoke and does what it needs to do but does not go further than that. In particular, with a keen focus on impact, we are taking action in areas where the CMA is best placed to act, so that we can deliver that impact. That is our strategic approach.
What has that meant in practice? To put Will’s resumé of our most recent announcements in context of the totality of what we have delivered thus far, within the first year we launched and completed three SMS designation investigations. As I am sure the committee is well aware, that is a designation for Google in relation to search, Google in relation to mobile, and Apple in relation to mobile. As Will said, there is also now a provisional designation decision on Microsoft’s business software ecosystem.
As we are implementing and progressing those designations, we are mindful of striking the right balance between the breadth of areas that we are covering through those designation investigations and the need to move with speed to implement targeted interventions off the back of those interventions once they are in place. As soon as we had the designations completed for search and for mobile, we moved forward.
In Google’s case, for search, we set out in our road map a series of interventions that we expected to take over the first half of the designation period, and we have moved at pace to introduce a first suite of conduct requirements. We can cover the detail of those if the committee would like, but a good example would be the measures that we introduced to give publishers more control over their content for AI overviews. That is a world first, in forcing that change through, and it is something Google have rolled out. That is one example there.
The Chair: We have questions on that later.
Sarah Cardell: On mobile, we secured immediate commitments from Apple and Google to improve the fairness and the transparency for app developers—for example, for app reviews and app rankings. We have also consulted on conduct requirements for app store fees and steering, as well as, as Will just mentioned, in relation to NFC access.
We have published the road map for Microsoft. As Will said—this is an important point, and one I am sure the committee will want to come back to—we think that we can maximise the impact of this regime by using not just formal interventions but identifying the right opportunities to use informal engagement to secure change. Obviously, the benefit of that is that we can do that incredibly quickly. We have done that with commitments to some of those mobile interventions, and, most recently, as Will said, some of the progress that we have been able to secure in cloud. We recognise that there is an important balance to strike between where we use informal engagement and where we move directly to formal intervention.
Overall, I firmly believe that we have implemented the regime with absolute priority, determination and a good track record of delivery. There is obviously more to come. We recognise that there is a whole host of issues that we can and should be considering action on for the existing designations and potential future designations. We are absolutely determined to keep that programme of work moving.
Q3 The Chair: On the more-to-come front, what are the priorities and expected milestones over the next 12 months, including following your proposed SMS designation of Microsoft? I have another question that I can roll into that one. You have proposed designation without conduct requirements. You talked about conduct requirements in a different case. Will you cover why you have not put conduct requirements, as with earlier proposed designations, in the case of the Microsoft SMS designation?
Sarah Cardell: Will, do you want to pick that one up first?
Will Hayter: It is worth recognising where we are in the process, first of all, with Microsoft. We have just published a provisional decision, and alongside that we published a road map. There are some differences with this process on Microsoft business software compared to where we were at the equivalent point on search and mobile, but there are good reasons for those differences.
In search and mobile, those kicked off, as we said, at the very beginning of the regime. Before the regime went live, we had already done some significant pieces of work, including market studies on the search side and the mobile side, and had already been thinking about the potential steps that might be needed. So in those road maps, we laid out a bit more of a sequence and put them into categories: the first category to move to most immediately, and a second category that was also of a high priority but would take slightly longer. We had some issues in those road maps, where we were keeping a watching eye on international developments, and then there were some that we were leaving for the second half of the designation.
On Microsoft, this started only five months ago, in May, from not quite a standing start but much more of a standing start for the formal process and without that backdrop of a big programme of work in the run-up to it. At this stage, what we have done is not to specify particular requirements that might be needed, but rather to talk about four focus areas where we want to prioritise and consider further work, to make sure we have understood fully the concerns that customers have expressed in those areas, and then work out what interventions, if any, might be needed. The four areas are: cloud licensing, which is the thread back through to some of the previous work on the market investigation on cloud—a separate project; AI features in productivity software; communications and collaboration software, such as Teams; and security software. Those are broader priority areas, rather than specified potential rules.
Q4 The Chair: Do you have the power from the Act to do those things in parallel, and to specify conduct requirements as you work through?
Will Hayter: Yes, subject to a final designation decision, of course, we are exactly progressing the thinking in the run-up to that point.
Q5 The Chair: Could you say when you expect the first conduct requirement to be in force and what change customers could see? Can you do a bit of looking forward on that one?
Will Hayter: There is a bit of a limit to how much leaping forward we can do at this point, given what I have said about the stage of the thinking we are at on potential interventions. The focus for the nine months—the statutory period for the designation investigation—is very much on making sure that we get that assessment right. There is a lot to it, and we are considering a number of digital activities. As I said, as part of that we are making sure that we are hearing from customers on the things that are on their minds and where there might be issues. Those mostly tend to relate to the ability of competitors to offer services in parts of the Microsoft ecosystem but connect them to customers’ own deployment of the Microsoft suite, and issues raised on the way that Microsoft does its commercial bundling and the choices that might cause customers to make.
Cloud licensing is the one exception where we are a little further ahead in understanding what those issues are. The concern is that, given the way Microsoft licenses some of its longer-standing services to customers, that may limit the ability of some key competitors to offer a competitive cloud service to those customers.
Q6 The Chair: The final point from me, before we move on to other questions, is this. What lessons have you learned from implementing the regime so far and how will those inform your operations in future?
Will Hayter: I will kick this one off, and I am sure Sarah might add to it.
I will highlight three points. The first point, and this builds on what Sarah was saying, is recognising the value of having a range of tools to achieve impact. We are focused at all times on positive impact for the UK—UK businesses and UK consumers—and we are trying to take maximum advantage of the full range of tools. In some cases, it is formal SMS designation and conduct requirements. In some cases, there may be value in the voluntary commitment approach if we can get to impact faster. As I mentioned, on the cloud piece, we think we have been able to get material progress in the absence of an SMS process. That is the first point: the range of tools.
The second point is the value of a flexible legal framework and having principles in the law, rather than specific black and white rules written into the law upfront. You can see that in the way that our thinking on the publisher controls has evolved and continues to evolve. We put that requirement out in its final form on 3 June this year. If we had had to write that 18 months previously, it might have looked quite different. AI overviews and AI mode were only a few months old at that point, and it would have been quite hard to get that right. As it was, we were able to work closely with Google, and, importantly, on the publisher side, with all those firms, to get that rule right for the moment, recognising that it may need to change over time as the market evolves and as Google’s approach to the way it draws on publishers’ content evolves. That is the second point: the value of a flexible framework.
The third point is that we set out our stall, all the way through, in the run-up to the regime going live, on the importance of a participative approach, which we reinforced in our thinking on the four Ps and how we would implement that in the digital markets regime. We think that the value of that has been borne out in practice. I have mentioned in the context of the publisher piece that we are much more likely to get to actual solutions that will have an effect in the market more quickly if we work in a more collaborative, solution-focused way with the SMS firms, or possible SMS firms, while also making sure that we get a rounded range of input from everyone else in a given area, rather than defaulting to an adversarial approach, as might be the case in some other contexts.
Sarah Cardell: If I could answer that very briefly, building on Will’s middle point about flexibility and agility. This is not a surprising lesson, because it was very much the intent of Parliament, but we are seeing the real benefit of the way that this regime is designed, perhaps in contrast to some of the equivalent regimes in other jurisdictions, to deal with such dynamic and fast-moving markets.
On our ability to flex over time, what are the issues that we want to prioritise and focus on? This comes back to your question. There is a balance for us around how much clarity, predictability and certainty we can provide about that road map, or path forward, of interventions while retaining some flexibility to be able to respond.
A great example of that is the inclusion of the focus on Copilot in the Microsoft designation, which probably a year ago we would not have had in our sights in quite the same way. However, it became clear to us that was a very important part of that designation, and is one of the areas that we have highlighted for at least potential intervention going forward.
It is about getting the balance between making sure that we are doing enough to tackle those known, perhaps more historic but certainly very present harms, and recognising the agility to help to anticipate and keep open the ecosystems as they are evolving and developing. We all knew that that would be a measure of success of the regime, but we are seeing the benefit of the regime design now playing through.
Q7 Baroness Owen of Alderley Edge: Last year, you told us that the CMA would launch strategic market status investigations into three distinct areas of digital activity within the first six months of the regime being operational. Instead, it launched investigations covering only two areas—search and mobile platforms—and did not open another until May 2026. Can you explain what caused this delay?
Sarah Cardell: It probably links back to the reflections on lessons and experience. Our priority initially, as we said, was to launch those designation investigations for search and mobile. One of my reflections—I do not know whether Will shares this—is that we thought of those as two investigations. They really were very much three investigations. It was not the case that running mobile was a single investigation. We had to run it, unsurprisingly, quite distinctly for Google and for Apple, both of which, as the committee is well aware, are very well resourced and potentially adversarial firms, making sure that we had really strong, sound designation findings. It is fair to say that that took more resource and more time than we might have anticipated. In part, it was about making sure that we absolutely locked in those designations.
That goes to the previous question about how quickly we get to conduct requirements and why we are not doing those in parallel with designations. It is because the most important thing for us to do in a designation investigation is to land a solid, appeal-proof designation. If we do not get that off the blocks then we will spend a long time in litigation, before we can even start to make inroads to change. The first thing is that we had to focus on those, and that consumed much of our time and effort.
We were, in parallel, thinking hard about cloud. Cloud was very much in our sights as the potential next area for designation, as Will said, because the cloud market investigation was happening on an overlapping timeframe.
As we were working through cloud as a prospective option—this goes to the point about responding to the evolving dynamics of wider markets—we were looking hard at what was happening in the wider business software ecosystem. The evolution that we were seeing, particularly with Copilot coming in over that timeframe, made us stop and think very hard and ask: if we are thinking about our next designation, should it be cloud or should it be the broader Microsoft-focused business software ecosystem?
As Will said, because we had done less work on that, we were, in the background, using our formal powers and gathering information, but had not publicly announced, so that when we went to the board in the spring of this year we were able to give them two well-developed options: do you want to move forward with a cloud designation, or do you want to move forward with a Microsoft-focused business software ecosystem designation, within which are some alternative ways in which we can tackle the issues identified for cloud? That took time to work through.
It is fair to say that it was probably a combination of a bit of overambition on our part with the initial timeframe and the need to work up those two options so that we could have a well-informed discussion with them in the spring.
Q8 Baroness Owen of Alderley Edge: Thank you so much. Under the Digital Markets Act, the European Commission has already fined Apple and Google over their app store practices. Has the UK’s more tailored regime come at the expense of swift delivery? I would like to add for the record that I was a guest of Google at its AI policy conference in December 2024.
Sarah Cardell: I will make one general comment and then ask Will to come in on the details.
Going back to the design of the UK regime, the measure of success is not about imposing penalties on these firms; it is about driving changes in conduct. That is why we have a focus on doing that, whether that is through conduct requirements, commitments or other informal engagement. The first point is that the absence of a fine is, frankly, a success, because it shows that our focus is on constructive engagement and delivering outcomes. That is the better thing, where possible, to focus on.
On how we are doing relative to the European Commission on issues of mobile, there is not much between us. Will, can you pick that up in detail?
Will Hayter: I am happy to. The DMA came into force earlier, and, as I know you will appreciate, is set up in quite a different way, in that the designations and a whole set of requirements came into force immediately. That means that it is not tailored in quite the same way as what we are doing here.
As Sarah says, we are focused on impact. We did our designations as quickly as we reasonably could, recognising the nine-month timetable and the need to get those right. We then have legally binding requirements in search, as well as three conduct requirements now in place, and we are in the process of working through the final stages on the fourth. Practical changes came into force on 1 April on the mobile side with those commitments with both Apple and Google. That is on app store issues, app store review, app store ranking and app store data use, and Apple’s interoperability process, and then the concrete changes that I have talked about on the cloud side.
It is worth recognising that the process of getting these requirements right, and tailoring them in the right way, does not happen overnight. That is where the good work needs to get done, so that by the time that we put it in place we are confident that it will be effective. I am glad to say that we think that should be the case with the publisher conduct requirement, for example, and the other two that went into force with Google earlier in the year. We can explain more about that if that would be helpful.
Q9 Baroness Owen of Alderley Edge: Thank you so much. We have already touched slightly on capacity issues, but we understand that staffing in the Digital Markets Unit has fallen by 16% since last January. Does the CMA have adequate resource and expertise to deliver a digital markets regime at pace?
Sarah Cardell: Again, Will might want to come in on some of the details.
It would be helpful to understand what is behind that percentage fall figure. That is not something that I recognise as a drop in staffing. We are well resourced to support our digital markets work, and the set of priorities that we currently have in train and the future work that we are in the process of planning.
I am conscious that this is, rightly, an area of interest for the committee. I wonder if it would be helpful to take a step back—tell me if it is not, because I could get into unhelpful detail—on our budget and resourcing position, and how we resource the digital markets work as part of our wider resourcing model. It probably would help to answer your question, but I do not want to go down a rabbit hole if it is unhelpful.
Baroness Owen of Alderley Edge: You could touch on it briefly, but it is about understanding whether you have adequate resources to tackle the issue.
Sarah Cardell: By way of background—I will try to keep it brief—the CMA’s resourcing position is set through our overall resource budget. That is set by the Treasury and is set as a total figure for the CMA’s work as a whole. It covers our resourcing, whether it is for digital markets, the consumer protection regime that came into force at the same time as the digital regime, mergers, markets and all of our respective front-line areas of work. As chief executive, I need ultimately to make the decisions about allocating resource across those different areas. We have 100 people or so working on our digital markets cases at the moment. That is a combination of lawyers, economists, front-line leaders of those projects and technologists, with a whole host of different skills. As I say, we are very confident that we are adequately resourced for the work programme that we have ongoing.
The complication with the budget perhaps relates to the fact that our digital markets activity is levy funded, in the sense that we can recover the cost of that activity from the designated firms. However, that is not a levy in the same form as, for example, other regulated sectors. It does not enable us simply to grow our digital markets activity without that coming at the expense of other areas of our work. If I told Will that I was going to give him 20% more resource on digital markets, I would then have to take that 20% resource from consumer protection or another area.
So there is a question here. If there is a desire for the CMA ultimately to do more, there would be opportunities to relax the rules around the levy funding and grow our resource that way. Of course, you can always do more if you have more resource, but we are confident that we have the resource we need to deliver the programme of work that we are currently planning. That is my best, not so brief answer, but I hope it is helpful.
Q10 Lord McNally: This must be a fairly small pool of expertise. Are there any restrictions on or incentives for changing sides, with you recruiting from the big companies or the big companies recruiting from you?
Sarah Cardell: Will, do you want to pick this up, as you are deep in our recruitment? We have a good talent pool coming in and flowing out. Perhaps you could elaborate.
Will Hayter: It is fair to recognise—this perhaps lies a bit behind your question—that there may be quite different things that attract people to either side of that divide. Clearly, in the Civil Service structure, we do not have the resources available to offer the salaries of the tech firms, but we do have a great public service impact offer, with lots of flexibility, personal development and a positive environment in which people can develop. That is our sell, and we have managed to deploy that to reasonably good effect. I may be a bit biased, but I think that it is an excellent team, with all the professions that Sarah mentioned, across lawyers, economists and tech insights, and the core digital markets team.
We are able to deliver good outputs, and it is important to make sure that we have the right insights into the workings of the tech sector. We are always interested to see if there are people who are interested in coming with direct experience from inside the tech sector, and we have a certain number of those. However, we focus on the public service impact and the fulfilling work that that can offer.
Q11 Baroness Fleet: As a yes and no answer, have you had any whistleblowers from Apple and Google join you in the last six months?
Sarah Cardell: I do not think that we have had anyone directly.
Will Hayter: No direct joiners from Apple or Google.
Sarah Cardell: We have had others from other tech firms, but not directly from those two.
Baroness Fleet: Not from Apple or Google. Thank you.
Q12 Baroness Caine of Kentish Town: You are confident that you have the resource to deliver the programme that you have strategically identified. Do you think the programme that you have identified is commensurate with the scale of the challenge that you are there to deal with?
Sarah Cardell: That is a very good question, to which there is not a straightforward yes or no answer. I am confident that, if we continue with the resourcing set-up that we have at the moment, we will deliver substantial impact over the next, let us say, three years. That would be commensurate with the ambition for the regime over that period. I do not think that we are resource constrained in a way that would lead to us underdelivering on the regime. We have the resource to enable us to deliver. If we had more resource, could we do more? Undoubtedly, yes.
It is worth saying—and this is true for the CMA as a whole and not just our digital markets work—that we are, as you would expect, also working very hard to make sure that we are deploying technology as well as human resource. The more that we are automating a lot of our work on evidence review, drafting and automated monitoring of some of the interventions that we have rolled out, those are all ways for us to very efficiently optimise the human resource that we have.
I am confident that we have sufficient resource to deliver commensurate with the ambition of the regime. I do not expect to be saying that we have not been able to deliver because we have not had enough resource. I do not think that we are in that position. Could we do more if we had more? Absolutely.
Q13 Lord Storey: Good afternoon. Your investigation into SMS launched to date has drawn heavily on previous research that you conducted well before the regime took effect. What work have you conducted to identify and prioritise new areas for SMS investigations?
Sarah Cardell: Will, do you want to pick that up, and also differentiate the Microsoft piece, which is somewhat in between the two?
Will Hayter: We are trying to strike a constant balance between making sure that we deliver and follow through on the things that we have committed to—the SMS designations investigations and the associated conduct requirements and other steps—and keeping an eye open for other issues that may be arising.
As you say, the moment of kick-off for the regime was unique, obviously, in that it happens only once, but we had all that previous work, particularly on search and mobile. We had the previous cloud market investigation that overlapped the start of the regime. That one is a bit unusual as well, because that then has overlapped with the thinking around Microsoft and the cloud-licensing issue that I mentioned. The reason that may be a concern is that it draws on the market power that Microsoft has in some of those core software services. We had a connected set of enterprise-facing issues across cloud and business software to think about, which was the subject of the March board discussion that Sarah was talking about.
We are keeping a watching eye on whether we might need to do future SMS designations. As you might expect, there are people coming to talk to us on a reasonably regular basis to ask what about this company or what about that company. The question of what is next is something that we will keep thinking about.
Sarah Cardell: To make that more concrete for you, if we think about the fact that we have designations now for Google and Apple, and prospectively for Microsoft, it will not surprise you to know that we hear a lot from third parties, “What about Amazon?”, in relation to the prior discussion on cloud and AWS and Amazon’s retail activities, and, “What about Meta?” We are seeing a lot of development in the Meta space as well at the moment. Those are areas where we are thinking hard about whether that is a prospective case for future designation.
What we are planning to do, and have committed to do already on cloud, is to bring back to our board in spring next year a further review of the progress on cloud outside of designation and a further review of whether that is sufficient progress or whether we should be moving to formal designation territory. We have committed to the board that we will review the position on cloud in the spring. I expect that, alongside that, a bit as we did this year, we would want to bring two or three other well worked-up options, so that the board has a good set of options. I do not want to say definitively now what those would be, but the candidates that I have mentioned might well be among that list. That is work that we are currently progressing, so that we are ready to have that board discussion in the spring.
Q14 Lord Storey: How are you ensuring that this work is informed by the views of a broad range of stakeholders, including companies of all different sizes?
Will Hayter: That has been a mantra throughout, as part of this participative approach. I have said on a number of occasions, possibly even in front of this committee, that participative does not mean a cosy relationship with the SMS firms or possible SMS firms. It means an open and collaborative relationship with all players in the market, in whatever the context is. You would need to ask the publishers, for example, in the Google search piece, or some of the app developers in the mobile space, to get the authoritative answer, but I think that we have managed to do that reasonably well.
In mentioning the publisher community, the publisher conduct requirement that we announced on 3 June was quite striking, in being well received by Google and by the publishers as a good step forward. We do not expect to repeat that on every occasion, but I hope that reflects that we have worked hard to get out and about and talk to all players in the market frequently. Indeed, I am seeing the publishers later this week to get the latest updates.
Sarah Cardell: That is probably the key driver of our prioritisation choices. When we were having the discussion with the board, for example, about cloud and the business software ecosystem, we heard a lot from UK businesses about the dependence on the Microsoft business software ecosystem. That does not mean that there were not also issues on cloud, but we could see up and down the land, in both the public and private sector, that dependence, which influenced the board’s choice on prioritisation. For the announcement that we made today, on access to Apple’s NFC technology, we have had huge engagement with the fintech community, which has been driving the opportunity to improve that access. For us, it is a critical measure of success that we are responding to those third-party views.
Q15 Lord Storey: There is probably no answer to this question; it is a short one. It is a little niggle I have. I use only Apple products and it uses the dominant position in the market to constantly bombard me with adverts for AI products. I am trying to delete them or move them on, but they seem to stay there for quite a long time. Apple is leveraging its position to do that. Is that right and fair and proper, at the expense of other companies?
Will Hayter: In a way, you have hit the nail on the head as to what this regime is all about, and the way we understand that position of market power for Apple. It is pretty much the case that, if I am a content provider or a developer of any sort, and I want to get to you through your iPhone, I have to come via Apple, and so Apple is able to set the terms of that. The NFC piece that we talked about from this morning is an example of that, where Apple gets to set the terms entirely of that. In this case, we think it prevents others giving different alternatives for access to the NFC chip. That is what this is all about.
Q16 Lord Holmes of Richmond: Good afternoon. There has been some criticism of your approach in this area, with comments that you are missing the mark and not getting to the heart of it. How do you respond, and how has this criticism influenced your approach, if at all?
Sarah Cardell: I am very confident that we are hitting the mark and progressing at pace, as I said in my opening comments. We have already made designations across Google for search for mobile, and Apple for mobile, with a provisional designation decision for Microsoft, all within less than two years of the regime, bearing in mind that those all carry a nine-month designation investigation. We have rolled out a series of conduct requirements already on search, with several sets of conduct requirements, and consulted on mobile, and at the same time we have driven immediate changes through informal engagement with Apple, Google, Microsoft and AWS. That is a strong account of what we have delivered in the first year and a half or so.
There is absolutely more to do, but I am confident that we have moved as quickly as we can to deliver that impact and focus, and that remains our priority.
Will Hayter: Just to add, one of the points that you may be getting at is that some people are saying that we have not done enough to open up these markets. The way I think about it is this. We have three categories of potential steps we can take: we can manage or mitigate the effects of market power; we can go after the core of the market power; and/or we can aim to open up adjacent markets or markets on top of the core market. Bear in mind that it is still 21 months in, so fairly early days, but we are achieving something of a balance across those three categories.
Something like the publisher conduct requirement or the piece on steering on mobile is more in the mitigation space. On the user-choice conduct requirement on Google and search, the reconsultation has just closed, and we aim to get to the conclusion of that as fast as we can. That is exactly about creating better conditions for more AI-enhanced alternatives to Google Search to be put in front of consumers via choice screens on Android and Chrome. That is very much a market-opening remedy. The NFC piece from this morning is an adjacent market. NFC access is not the core of Apple’s mobile platform but is an important market that sits on top of that platform, where we are, as we said, trying to open up access and make sure that developers are able to come and offer compelling solutions.
We will keep thinking about the balance of those three categories as we go. As Sarah has said, thus far I think that we are getting that balance about right, but it is something that we are very much thinking of as we go.
Q17 Lord Holmes of Richmond: That is very helpful. On the incoming that you are getting, has that been largely as you imagined and does it skew to one of the three approaches that you can take, or is it spread across all three potential directions that you have available to you?
Will Hayter: It tends to be quite particular to the group of stakeholders concerned. As I said in response to Lord Storey’s question, if you think about the Apple ecosystem in the round, there is a level of control over that system from Apple and a difficulty of others getting in and competing, but exactly how that manifests is quite different. We hear from the app developers who are concerned about the app store terms and conditions. That is a completely different set of companies from the fintech companies and the digital ID people and so on, who want to deliver interesting services via the NFC chip. There is a commonality of underlying concern but the way it manifests is quite different.
That is different again from what you get from customers in the cloud and software space, who may be worried about lock-in or not being able to multicloud. They are quite different concerns.
If you think about the publisher set, for example, and news publishers in particular, unsurprisingly there was an immediate clamour: “Please help us redress this imbalance in bargaining power that we have with Google”. I am sure they would also like us to do the opening-up piece as well. However, we started with the focus on trying to rebalance the scales a little, as the first step.
Q18 Baroness Fleet: Thank you so much for coming in today. In July, you told us that you would monitor whether the new publisher conduct requirement was strengthening publishers’ ability to negotiate with Google, alongside its impact on remuneration. What have you found so far?
Will Hayter: There are a few phases to this. There was immediate progress, in that almost as soon as we had made an announcement on 3 June, Google started rolling out some of the new tools and new controls, both in the UK and internationally, which it had said that it would do. So there is already the ability for publishers to start taking advantage of that change. We understand that more deals are being done. I do not want to put too much specificity around that now, because it is still only a handful of months since that came into force.
There are two important dates to come. One is 3 December, when the majority of the requirement comes into force. That is the compliance deadline. From that point, a set of important data becomes available, which is that publishers will then be able to see the number of click-throughs they get when their content appears in AI overviews. They are already getting some data from the very early implementation. That set of data will be critical to help them understand the trade-off that they are making when they decide whether to stay in the AI overviews or not.
A further step is on 3 March, which is when the page-level controls come in. That is a further level of control that they will be able to exert. We would expect this position of strength and bargaining power to get better and better over time if you look at that compared to this moment.
Q19 Baroness Fleet: You also said that the CMA would consider further measures—that is possible after March, perhaps—including on payment for content if the publisher requirement failed to secure a fair exchange of values. What evidence would trigger that intervention, and when will you make that assessment—presumably after March? What would you consider a fair exchange of value?
Will Hayter: That is a big question that I will not attempt to answer in quite those terms now. The key evidence that we want to get is what is going on with these negotiations and these deals, or if there are not any deals. Until the control came into force, you had a real problem with the bargaining power, in that a publisher could not choose to take themselves out of AI overviews without removing themselves from Google Search as a whole. With the control, they are now able to disaggregate those two decisions and have a better discussion with Google. Once they are able to see that click-through data again, they will be in a stronger position.
We are already thinking carefully, well ahead of 3 December and 3 March, about the steps that might be needed. We are thinking about potential measures to enable publishers to join together to bargain with Google, if that would help, and we are considering, exactly as you say, what it would mean to get to this fair exchange of value and what more might be needed.
Q20 Baroness Fleet: That brings me on to the Meta issue. I am not sure that everyone here will know, but Meta’s new terms come into force on 30 October and will force businesses to let Meta copy their websites, with no opt-out. Is the CMA looking into this? Will it ask Meta to pause the terms while it does? There is considerable concern about this, and the deadline is next week. What are you doing about it? People here need to understand that Meta is changing its terms, so that it can copy content from news publishers’ websites. What are you doing about that?
Will Hayter: We are very aware of that. This popped up on to the mainstream consciousness last Thursday. We have been talking to publishers and hearing their concerns, both the public concerns and the more private versions. It is exactly as you say, and we are talking to Meta about it. We wrote a letter yesterday to ask for information on that, and I am talking to Meta tomorrow to make sure that we have understood what is going on. We will then work out what to do next.
Q21 Baroness Fleet: Will you pause the deadline? It is in a week. This includes almost every UK news publisher. It is clearly an uncompetitive leverage of Meta’s strategic market position. Those are two different points.
Will Hayter: I hear that characterisation. That is very much the complaint that is being made from the publisher side. Yes, there is only a short period to go, but this issue has only just arisen, it seems, or people have only just become aware of it. We are trying to make sure that we fully understand it before working out what we do.
Q22 Baroness Fleet: Did you realise that Meta had removed the word “train” from the terms?
Sarah Cardell: To reinforce Will’s point, like the committee, we heard of this last week. We engaged directly with Meta. I have written to Meta and Will has a meeting tomorrow. We share, at face value, the concerns. We need to understand it better and we will then think about—this goes to the point about informal as well as formal—what steps we can take through informal engagement and formal engagement. We obviously do not have a live designation for Meta. There is the option of using our competition enforcement powers. We are very alive to the potential impact that this could have for UK businesses, and it is something that we will take very seriously.
Baroness Fleet: Okay, but a straight yes and no. Were you aware that Meta had removed the word “train” from its terms? That is the first question, yes or no. Were you aware of it before Thursday?
Sarah Cardell: Only as it was raised with us by stakeholders. We do not have a designation in place with Meta. We have had this issue raised with us and we are taking action as soon as it has been raised with us.
Q23 Baroness Fleet: You are only now aware of it. What about delaying the deadline beyond 30 October?
Sarah Cardell: The question there would be what formal powers we have.
Baroness Fleet: Do you have formal powers to delay?
Sarah Cardell: We do not have formal powers under the SMS regime because we do not have an SMS designation in place. We may have powers to use under our competition enforcement powers, but we need to understand this urgently. The conversation Will is having tomorrow will be on what the position is and we will then consider it urgently. We can happily follow up, recognising the importance of this issue.
The Chair: That would be helpful if you could do that.
Baroness Fleet: It would be helpful to know that. Thank you very much.
Q24 Lord Tarassenko: I want to ask a follow-up question to the last point that we discussed, which is about the phenomenon of personal AI agents, with Meta’s Muse, OpenAI’s dots and so on. Do you have staff within the CMA who will be able to investigate this?
One of the most common uses of these AI agents will be to book travel, for example. You will ask your agent to book your travel. With Google, for example, Google Flights always appears at the top. There would be no humans involved, so it would be just agents making those choices. It could be that their self-preference cleans up completely, because it is done by agents rather human beings. Do you have the technical capabilities to work out how introducing these personal agents will distort this market?
Sarah Cardell: I will make two points, if I may. On technical capabilities, I believe that we do. Going back to the resourcing point, as well as investing in our digital markets team over the last couple of years we have invested heavily in technical capability, and we have a team under our chief data technology and insights officer. They are deep technical experts and they engage across our digital markets, and work toe to toe with the tech expertise in the firms. This as an issue has been on our radar and we have been working hard to understand, through our horizon scanning, those potential developments and exactly the set of issues that you have outlined. So on technical expertise, yes, we have it.
We are also thinking hard, within our toolkit, about where we are best placed to act. We think that agentic deployment with a consumer-facing use, such as Meta Muse, is most likely to bite on our consumer protection powers. It may come under a designation, but, again, it depends whether there is a designation in place. A couple of months ago, we published some guidance, recognising that this issue was coming at us fast, setting out how and why existing consumer protection rules apply to businesses that are developing agents in this consumer-facing way. All of the usual consumer protection apply—rules on transparency, pricing and making sure it is clear where the liability sits. We have put out clear guidance to businesses to explain that they need to be training their models in a way that ensures consumer protection compliance and auditing, and modifying if they find that it does not.
We are engaging with the firms as it happens, including with Meta, as we are seeing these use cases potentially coming to market. We have engaged with Meta across a number of issues recently, including on this issue, wanting assurance that the terms and conditions for Muse as it is rolled out in the UK give us confidence that it has consumer protection compliance at heart. Again, we are happy to update on that if it is helpful.
Q25 The Chair: You talked a bit about the cloud inquiry group. Which of the competition concerns identified by the cloud inquiry group could the Microsoft investigation address comprehensively and which would remain unresolved? I also want to touch on the voluntary engagement with Microsoft and Amazon, which you intend to review. Could you cover what specific improvements you expect to see in spring 2027, and what would prompt you to launch formal SMS investigations rather than continue with voluntary measures? We might have a few questions around voluntary measures versus other measures that you have.
Will Hayter: There were three broad categories of issue that the cloud market investigation identified, all relating to this question about the ease for customers of switching and/or multicloud: egress fees, which are the fees to transfer data between clouds; interoperability, which is a broad topic and I will come back to that; and the issue about cloud licensing, which I touched on earlier.
This is where the intersection between our voluntary cloud work and the formal SMS investigation comes in. We are proposing to designate the two key services that are at the heart of the cloud licensing issue as part of the SMS designation. That is the Windows server software and database software. The concern is that they are leveraged to make it more difficult for competitors to compete against the Microsoft Azure cloud service.
That one is very much squarely in the frame for the formal SMS piece. We have put it, as I said, as one of the four issues that we will look at in the road map. That is the one with the most detail on it, because it has a bit more prior work behind it.
The other two are where the process of engagement with Microsoft and Amazon has come in. When we made those announcements on 31 March, both companies announced concrete changes there and then, taking effect in their contracts on egress fees. Broadly, those are removing egress fees before switching and reducing the fees for multicloud.
They announced other steps at that point and we are in the process with them of overseeing that implementation. Those are, in particular, making sure that both companies have processes for other companies to request interoperability with their clouds. It is also important that both companies promote those and make sure that companies know they are there. There is also a set of changes on physically directly connecting between different data centres across providers. Again, we think is an important feature to help with switching and multicloud.
Some of those issues are a bit more of an on-off switch—the egress fees, for example. It is important to recognise that interoperability is definitely not something where you can go from 0% to 100% interoperability. It is a question of degrees.
We think that there have been improvements already, but we have said that, from this point on until the next checkpoint for the board, companies need to make sure that they really follow through on those changes. For example, the direct interconnection product is partially rolled out already, but not fully. We want to see that more fully rolled out. We want to see the interoperability processes made more prominent, so that customers take them up. We will track those metrics carefully as to how many people are availing themselves of those opportunities.
Through the past few months, we have identified two specific areas that we want to focus on with the companies in this next phase, all with the same mantra of supporting switching and multicloud. These are, by the way, informed very much by detailed conversations with quite a lot of customers—this is the stuff that customers care about. The two areas are improving security across clouds, so that it is possible to move applications and data more seamlessly across different providers’ clouds, and improving the portability of—forgive the jargon—Kubernetes containers, which are intended to support portability but we have heard that friction is being added around the fringes and we want to make sure that that does not get in the way of portability.
Those are themes that we have been working on and will continue to work on. The board will need to be confident in the spring that there has continued to be concrete progress—that the companies have followed through on the early steps and made concrete progress getting to actual solutions on the two particular areas that I have just talked about.
Q26 The Chair: My final point was this. What would prompt you to launch SMS investigations rather than continue with those voluntary measures? Voluntary measures achieve a certain amount. I can understand your point about interoperability, and it is a very wide path, but what would push you into an SMS investigation?
Will Hayter: At this interim point, we have essentially just been taking stock of progress and working out whether the companies have done what they said they would do. At the further review point, we will then be redoing some of the more quantitative analysis that we did in the market investigation, to understand the figures that help us shed light on the question of how easy it is to switch and to multicloud. We want to see continued work with us, and material progress and steps taken by the firms in the next period, but we also want to see some of those outcome metrics start to improve.
It is important to recognise, similar to the interoperability point, that there will be a lag effect, even once some of these features are available to customers. Customers are not changing their cloud architectures every month. We would expect the actual effects of some of those to take a bit longer to take effect. That would be an important point in time to work out whether this voluntary approach has continued to deliver impact. We think so far that it has, but there is more to be done.
Q27 Lord Tarassenko: You just used the phrase Kubernetes containers. You also used the word metrics, which those from my background very much favour, along with outcome metrics. You talk about monitoring interventions in the particular context of the app stores. You have the voluntary agreement, as you have mentioned a couple of times already, of February 2026, that Apple and Google would make their app stores fairer and would not try to advantage their own products in the way they have done in the past. How are you going to monitor that? What metric are you going to use? A year from then, in February 2027, how will you be able to report that the voluntary agreement is leading to a change in practice by Google and Apple? We are hearing from the field—though I do not particularly worry, as I think it is noise—that the voluntary agreement is not worth the paper it is written on. You can only judge whether or not it is if you have the right metrics. What are the right metrics? How will you report and when will you report?
Will Hayter: They are all really important questions. I totally agree with you that we have to be absolutely on it to make sure the companies are complying and getting to the kinds of outcomes that we want.
To go back a step, what we are really interested in for the app store, in the commitments context, is the confidence of app developers to invest and innovate. That is the impact or outcome. There is then a whole set of input metrics that we are tracking and will continue to track over the coming months to make sure that the companies are doing what they said they would do. Those are all listed in the commitments published back in April. They include things such as the number of complaints and the number of appeals, the outcome of those appeals and the number of data access breaches.
There is also the interoperability request for Apple. Apple itself has already published its first transparency report on that, detailing the number of requests it has had, how many of those were accepted and how many were rejected. We are in the process of digging more, behind closed doors, to work out the reason behind the rejections. We will be applying a similar close eye to the first private compliance reports, which we had in a couple of weeks ago, on the app store review ranking and data use commitments from both Apple and Google. Those are their private compliance reports to us. They are also due, in time, to produce public reports, and we will be commenting on what we have seen in the private versions.
There is a whole host of information here to try to lengthen transparency and boost confidence. That is what we are really concerned about in the end.
Q28 Lord Tarassenko: You are saying that you will publish a report with data that can be in the public domain in, say, February 2027, after 12 months. How does a developer have access to this information to see whether there has really been a change or not?
Will Hayter: Both Apple and Google, and us, separately, will be publishing reports over the next few months on the whole app store piece.
Q29 Baroness Caine of Kentish Town: In May 2025, the Government published a new strategic steer for the CMA. It said that you clearly and unambiguously needed to reflect and enhance the attractiveness of the UK as a destination for international investment, and that you needed to unlock opportunities for growth across the UK by the style in which you managed your relationships. How do you respond to the claim that that steer, with its emphasis on growth and inward investment, has led to you taking a lighter-touch approach in your decisions on digital markets?
Sarah Cardell: I will take that in two parts and talk first about the way that we go about our work and then, secondly, how it has affected what we have been doing, particularly in the context of our digital markets work.
On the first piece, about the regulatory environment—this is something that I have thought very hard about, and I think we possibly even touched on it when we were last before the committee—it is broader than our digital regime. There was a reasonable challenge to the CMA about whether the way that we were going about our work was delivering—this was behind the genesis of the four Ps approach—at pace, with a degree of predictability and the right level of engagement with business, to build business and investor confidence in the competition regime, with the competition regime being part of the UK’s wider regulatory regime.
I do not think that concern was particularly directed at the digital markets regime, because it predated the introduction of the regime. It was probably particularly directed at our merger regime, but it became a wider question for us. I had heard similar feedback in the quite extensive engagement that I had been doing with the business investor community.
I think it was a fair challenge. That is why I personally put so much focus, at the beginning of 2025 and throughout 2025, on the four Ps framework. We said that, whatever we do, we should be moving at as quick a pace as possible, taking action proportionate to the intended aim, as predictable as we can be and engaging directly with businesses, so that the process of engagement is really strong and sound.
As it happens, for the digital markets regime, all of those principles were well embedded in the regime that Parliament had designed. It already gave us a focus on pace. It absolutely gave us a focus on proportionality—there was a lot of parliamentary debate about proportionality at the time—and on the need for clear and predictable action. My fourth P, process, really was about a participative approach.
For me, one of the things that made the four Ps relatively easy, in a way, was that we had done a lot of that thinking in the development of the digital markets regime. When we came to the strategic steer, it was not a difficult thing really to take that steer and think about how we would implement that for the digital markets regime, because it was work we had already done. If anything, we were probably learning from that and applying it to our mergers work and other areas of the CMA. That is the first point around our approach and the engagement piece.
It has been really important. The way that we have operated with the participative regime has enabled us to deliver outcomes quickly. People can debate the pros and cons of formal or informal, but it is indisputable, to take the discussion we were just having on cloud, that had we gone down the route of a formal designation, we would now be issuing a provisional designation decision, probably highly contested and probably with that designation being appealed, and we would be months, if not years, off any action. However, as Will as outlined, we are already engaging and delivering real action. I think that is a very good example of the synthesis of the four Ps approach, with a positive regulatory regime that drives positive engagement from firms and builds benefits across the UK economy. That is a broad point.
On the specific question of whether the steer has led the CMA in some way to back away from a full-blooded implementation of the digital markets regime, I really do not think it has. I have it in front of me, and the specific paragraph on the digital markets regime in the steer talks about the CMA using the regime to “independently, flexibly, proportionately and collaboratively unlock opportunities for growth across the UK digital economy and the wider economy”. That is exactly what we are doing.
The NFC work, as we have said, is a really good example of us having identified the fintech space as a major growth area for the UK economy. We know that it is being held up. We have heard from many players in that space who have seen access being made available in the EU and not on fair and reasonable terms in the UK. That is holding up innovation here, hence our priority. If we look at the work on productivity software in the business software ecosystem Microsoft investigation, that is absolutely directly responding to concerns from UK businesses.
We are taking the steer, which tells us to focus on opportunities to unlock growth across the digital and wider economy, and we are applying it. We are absolutely not, in any sense, feeling constrained in the way that we apply that, while adhering to the principles of pace and proportionality, which I think were instilled by Parliament in the regime anyway.
Q30 Baroness Caine of Kentish Town: If, for example, you reached a point where you felt you had to take really robust action against a major technological company—you can take action among SMEs—do you feel that the Government would give you full backing, even where they could potentially argue that it is deterring investment in the UK? Do you have that confidence?
Sarah Cardell: I am confident. Provided that we are taking action in areas where we can show demonstrable benefit for the UK economy and for UK businesses from the action that we are doing—it is our responsibility to make sure that we are choosing issues in such areas—I am confident that we will have that backing.
Q31 Lord McNally: Then why do we keep on getting evidence from the creative industry sector, a very important sector of our economy, that they are being thrown under the bus by high-pressured lobbying by the tech companies?
Sarah Cardell: I think we have given a very detailed account of all of the steps that we are taking. We genuinely believe that we are moving as quickly as possible through a high-priority set of issues. I can only say that I do not feel under any personal pressure or institutional pressure to hold back. I cannot explain what others are saying, but we are not experiencing that pressure and the actions we are taking are not in any sense being constrained by that.
Q32 Baroness Caine of Kentish Town: I hear what you say and the confidence with which you were saying it, but perhaps you can clarify for me, as I am learning, as we all are, from listening to you.
Take the Meta example and the publishers and newspapers example. You were explaining that taking action might have to be done through other means, because they were not designated as having strategic market status. As far as I understand it, strategic market status is if they have substantial and entrenched market power and are in a position of strategic significance. As a lay person, I find it hard to understand how Meta could not immediately be seen as being in that position. You were also talking about going to your board with options, and who you were going to go with first, which takes us back to the resource issue.
There seems to be a sequential approach to arriving at that status, which then also complicates your ability to intervene, for example, in this immediate case. I wonder whether accelerating that process would be a sensible thing. I would say it opens you slightly to questions of whether or not the pace is being directed in a sense, by which you could be questioned about whether or not the Government were putting you under pressure.
Sarah Cardell: Will might want to come in on this. We are of course implementing the regime in line with the legislative design. The legislative design is that there is a nine-month designation process, with milestones along the way, including a lot of stakeholder consultation and a provisional decision. We have to go through that process. Even in situations where it might seem obvious, we are up against big and well-resourced companies.
Baroness Caine of Kentish Town: I completely understand that, but what I am trying to say is this. Instead of doing three at the same time, you are doing them one at a time. There is, as you rightly say, that nine-month period. I am trying to see whether you are supported in resources really.
Sarah Cardell: You are right that there is ultimately a resource constraint question. Inevitably, that must be right. We did run three in parallel, with Google Search, Google mobile and Apple. We ran those three absolutely January to October, in parallel. In parallel to that, we were working up two strong options for the board to consider. Could we run another three in parallel right now from a resourcing perspective? No.
Q33 The Chair: I think there is a sense from a number of us that it is not just a question of resource, although everybody understands resource is a problem.
Do you foresee the CMA using the range of interventions that it has? We get the same sense from other regulators. You are up against tech giants. They can contest things and appeal things. They have deep pockets. It makes you cautious and it makes you slower. It makes you go for voluntary agreements. That is the sense we have, if I can express what the committee feels, and that is difficult.
Have you got the backing of the Government to start using your pro-competition interventions to really start making the difference that you could make with the powers that you have been given?
Sarah Cardell: It is helpful to distinguish resource constraints, pace and government influence, because they are separate things. I can sense that Will is desperate to come in on some of this. I do not agree that we are slow or cautious.
The Chair: We are not saying that, but it has been said.
Sarah Cardell: I genuinely think we have moved with quite considerable pace and ambition. That is also the sentiment of our board, I should say. There is real appetite from our board members to drive this work forward.
There is always a balance, you are absolutely right, because these are legal processes. We have to strike the right balance between moving as quickly as we can and not getting to a point where pace is the enemy of impact, and we move too quickly and are then stuck in litigation, so it takes us years to deliver anything. Our focus is on pace and impact; the two things go hand in hand. With that comes the balance of what we can achieve through formal measures, which have a formal status and formal heft, and a sense of mandated obligation, and at the same time pragmatically identifying areas where we can make tangible changes faster, and, frankly, engaging with the firms in a way that says there is benefit to them also from making some of these changes voluntarily. We are constantly and consciously trying to strike that balance.
I think that is a regime point and a resourcing point inevitably, to some extent. I truly think that is distinct from whether we are being held back in our ambition because of political influence. I do not think that is the case.
Q34 The Chair: As a separate point, do you feel you have the backing of the Government to take them on? It is almost as if you are saying “Well if we get into these cases, it could be contested, it could be appealed, so then we shy away, because we do not want to be years and years in litigation”. Where you have powers, I think Parliament wants to see you using them.
Sarah Cardell: We are absolutely not shying away from a fight. My point is that we want to be selective about which fights we take on because those fights consume resource and they are not the quickest way necessarily to deliver impact.
Perhaps I can give the committee some reassurance on whether we have political backing. Obviously, that is a question for government, but from the conversations I have had with Ministers, I know that they hear from many of the same stakeholders that you have heard from. I know, for example, that they have heard from the publisher community and understand the imperative behind the action that we are taking there. I know that they have heard from the app developer community and understand the importance of the action that we are taking there. I know that they have heard from the fintech community and understand why we are prioritising NFC access.
I think if we were taking action that was not linked to a tangible and demonstrable benefit for the UK economy then they might question why we were doing that—but so would I and so should you. That is why I make that connection. I believe we have the Government’s backing for that action. I think that is as much as I can say.
Baroness Caine of Kentish Town: You were saying that Will was probably dying to get in.
Will Hayter: I will say a couple of things, briefly, to emphasise the point.
They are not here to speak for themselves, but I do not think the people churning out the stuff that we have been producing in the last few days, for example, would feel that we are moving slowly.
You are right, however, to say that the companies that we are involved with do indeed have extremely deep pockets. We have a lot of expertise and legal and economic input thrown at us, and we have to work through that.
I am not at all surprised to hear people out there in the market say that we should do more and do it faster. That is the whole purpose of the regime, in identifying that these are very powerful companies that in many cases hold a great degree of control over the markets they are in. There is a long list of companies, and then at the other end there are the consumers—the publishers, which is essentially every website owner, app developers, fintechs, the digital ID folks we talked about, any company that is interacting with cloud or software in the UK and the competitors trying to do business in those markets as well. There is a long list of people out there who want to pursue their businesses and serve their customers and consumers, and they want us to create the level playing field on which they can do that.
I will pick up the specific point on pro-competition interventions. This connects a bit to the answer I gave Lord Holmes earlier. You are right that there is a tool there—the pro-competition intervention—that we have not yet used, and I am sure we will at some point. Right now, I am thinking carefully about the market opening versus managing harms balance. To emphasise, it is possible to do market-opening remedies with conduct requirements, such as the user choice one. There may be some potential interventions in future that require the PCI tool, and we are very much keeping that possibility open.
The Chair: Thank you very much indeed. I think that is all of our questions. There is a point to follow up around the publishers, and you have said that you will follow up. We are very grateful for that. Thank you very much.
