Two decisions landed on the same day, and together they hit the two business models that have financed the internet for two decades. In London, the competition regulator imposed new transparency rules on the search giant’s advertising business, according to PYMNTS. In San Francisco, the long-running antitrust case between Epic Games and the company that operates the Play Store came to a close, with the store ordered to open its doors to third-party payments and distribution.
The U.K. rules target the black box of search advertising. Advertisers have complained for years that they cannot see how much they pay relative to competitors, how placements are chosen or what the auction actually rewards. The new regime requires the company to disclose the criteria behind ad placement and pricing, a change that could ripple through the auction prices that underpin its revenue.
The two actions are separate cases with a common theme: platforms that control the terms of commerce are being forced to open up. The search company built its fortune on an auction it designs and runs; the app store operator built its on a commission it sets and enforces. Both models assumed the platform could write its own rules. Both are now being told otherwise.
The Epic case has been the longer battle. Epic sued over the Play Store’s 30% commission and its ban on alternative payment methods, and a jury in late 2023 found the company’s practices unlawful, a verdict that withstood appeal challenges. The final remedies, now ordered, require the store to allow third-party payment processors and third-party distribution channels, ending the arrangement in which every purchase had to flow through the store’s own systems.
The 30% commission was the app economy’s most contested number. It was the price every developer paid for access to the platform’s users, and it survived for years because developers had nowhere else to go. The remedies crack that monopoly: developers can now route payments around the store, keep a larger share of revenue and reach users through channels the platform does not control.
The search rules cut in a different direction but with similar force. Search advertising is priced in an auction that the platform operates in private, and advertisers have long suspected they pay more than a transparent market would set. The U.K. requirements force disclosure, and if the disclosures show the system favors the platform’s own services, the pressure for deeper changes will grow.
Both decisions have a common source: regulators who decided that a platform’s control over its marketplace is not a private matter. The U.K. and U.S. cases were pursued by different agencies under different laws, but they converged on the same question, whether the companies that operate the digital economy’s main thoroughfares can also own the toll booths.
The commercial stakes are enormous. The search auction generates the largest advertising revenue stream on the internet, and the app store commission generates a large share of the platform’s profits. Even partial changes to either will move billions of dollars between the platforms and the businesses that depend on them, and both companies have indicated they will fight the details in court.
For developers and advertisers, the rulings are an invitation to recalculate. App developers can now model businesses that do not pay the old toll; advertisers can demand to know what they are actually buying. The balance of power between platforms and their customers has shifted, and the shift will show up in margins, pricing and product decisions over the next few years.
The search case has been building for years. The U.K. regulator opened its examination of digital advertising after advertisers complained that they could not verify what they were paying for, and its market study concluded that the platform’s control of the ad stack let it favor its own interests. The transparency rules are the first enforcement of that finding, and the regulator has said it will monitor compliance closely.
The app store remedies face their own long road. The company has said it will appeal the scope of the order, and the case could take years to resolve, during which developers will weigh whether the new channels are worth building against the risk of another reversal. History suggests that such remedies, even when upheld, take time to change behavior.
The two cases also share a regulator’s logic: consumers and businesses should be able to see what they are paying for and who is taking the margin. That logic has been applied to banks, to telecoms and to airlines; the internet’s intermediaries have resisted it longest, and the rulings this week suggest the resistance is ending.
The decisions also send a message beyond the two companies. Every platform that sets the terms of its own market, in payments, in advertising, in delivery, is now on notice that the rules can be rewritten. In a single day, two of the internet’s oldest business models were told that the era of writing their own rules had ended.
