CBA’s Matt Comyn takes a swing at Apple

  • By Elizabeth Fry

Commonwealth Bank boss Matt Comyn has urged parliament to ensure that the fast-growing digital wallet payments market is competitive saying Apple’s considerable market power - and how that is exerted - should be of growing interest. 

On Tuesday, Comyn appeared before the parliamentary joint committee on corporations and financial services which is conducting hearings to examine the high and rising use of mobile phones to make payments.  

Comyn continued to push the theme that Apple has an 80 percent share of the digital wallets market but is allowed to dominate the digital wallet payments market and block rivals from its system. 

He pointed out that the competition watchdog in April had raised concerns about the power of Apple and Google’s app stores. 

“This is consistent with our experience,” said Comyn who added that the ACCC had taken a “courageous" stance. 

“In line with the findings of the ACCC, it appears likely to us that additional legislative powers may need to be conferred, possibly by designating the largest platforms, or creating obligations or countervailing factors that reintroduce competitive tension.” 

The chief executive of Australia’s largest bank agreed that Apple made “fantastic products” but reminded the committee that the tech giant’s market cap was double Australia’s GDP. “And certainly, in the context of tax receipts, it makes little contribution to the Australian government’s receipts," he said. 

Further, he added, Apple makes no contribution to the country’s payments infrastructure estimated to be around $2 billion over the last five years. 

Comyn said the CBA is very focused on getting access to Apple’s NFC chip but had been refused on security grounds  

In contrast, he noted that Google has opened access for third-party app developers to the NFC chip on Android phones and without charging fees. 

“Manufacturers of mobile handsets and associated software set the terms on which third parties can offer these app-based services, particularly concerning payments for, and via, these services,” he said.  

“They also can restrict apps that provide services that compete directly with those supplied by the manufacturer of the mobile device. 

Market distortions 

Comyn said the ability of mobile phone providers to restrict competing services accessed through the app store will inevitably lead to distortions in markets for services provided through mobile apps. These distortions will only intensify if left unaddressed, he told the committee. 

“Given the rapidly expanding market power of the largest app store providers, companies wishing to reach customers in that ecosystem must, by and large, comply with the terms set by the platform providers. If they do not, they are electing to be absent from the ecosystem, foregoing a primary channel preferred by their customers.  

“Australians who use Apple devices should be able to make their own decisions about which features they prefer in a wallet app, as Android users can. Yet currently they cannot,” he said. 

However, as technology evolves, he went on to say, it will be important that actions are prevented that have the effect of significantly lessening competition, particularly from platforms of paramount significance for competition across markets.