As Big Tech scrambles to meet EU rules, investigations seen as likely

Subject: Science and tech

Section: Awareness in IT

Context:

The world’s largest tech companies, including Google, Apple, Amazon, Microsoft, Meta, and ByteDance, have updated their core platform services to comply with the European Union’s Digital Markets Act (DMA), aiming to ensure fair competition.
However, there’s scepticism about the adequacy of these efforts, with potential investigations looming due to possible non-compliance.

About Digital Marketing Act (DMA):

The DMA represents a significant regulatory move to control the influence of “Big Tech,” threatening fines of up to 10% of global turnover for non-compliance.
Apple is notably impacted by the DMA,required to allow alternative app distribution channels outside its App Store in the EU.
However, its introduction of a “core technology fee” has raised concerns among EU antitrust authorities for potentially discouraging businesses from switching to competitors.
The EU aims for swift enforcement of the DMA, contrasting with the typically lengthy antitrust investigations, indicating a rigorous approach to regulating Big Tech’s market practices.

Which companies have to follow the rules?

DMA targets 22 services spanning operating systems, messenger apps, and social media platforms, aiming to regulate the largest tech companies.
Services under scrutiny include Google’s Maps, YouTube, Chrome browser, and Android OS; Amazon’s Marketplace; Apple’s Safari browser and iOS; Meta’s Facebook, Instagram, and WhatsApp; and Microsoft’s Windows and LinkedIn.

WHAT EFFECT WILL THE RULES HAVE GLOBALLY?

DMA signifies a crucial development by the European Union in its role as a global leader in regulating the tech industry.
The EU has a history of imposing significant fines on Google for antitrust violations, establishing stringent social media regulations, and introducing pioneering artificial intelligence legislation.
Now, countries such as Japan, Britain, Mexico, South Korea, Australia, Brazil, and India are creating their DMA-like rules to prevent tech giants from monopolizing digital markets.

HOW WILL DOWNLOADING APPS CHANGE?

Apple has announced it will allow European iPhone users to download apps from sources outside its App Store, a significant shift from its previous policy.
This change is in response to the Digital Markets Act (DMA) requirements but comes with a caution from Apple about the potential security risks of “sideloading” apps.
Despite reducing the fees for app developers who choose to use Apple’s payment-processing system in Europe, Apple is introducing a 50-euro cent fee for each iOS app installed via third-party app stores.
Critics argue this could discourage developers of free apps from using alternative app stores, as they would now face a per-user fee, potentially limiting the diversity and appeal of these stores.

HOW WILL PEOPLE GET MORE OPTIONS ONLINE?

Under the Digital Markets Act (DMA), consumers will gain more autonomy over their digital choices, and no longer be bound to default options for essential services.
Android users will have the freedom to select their preferred search engine, while iPhone users can choose their default browser.
These changes aim to dismantle the automatic preference for services like Apple’s Safari or Google’s Search, with European users encountering choice screens on their devices to facilitate this. Additionally, Microsoft will no longer compel users to adopt its Edge browser.
However, concerns persist among smaller service providers that these measures may not significantly alter consumer behaviour.

HOW WILL INTERNET SEARCHES CHANGE?

Google will modify how some search results are displayed, eliminating the preferential treatment for its own services.
- For instance, hotel searches will feature an additional carousel for booking sites like Expedia, while Google Flights will no longer have a dedicated button and will be included among the standard blue link search results. This change aims to foster a fairer competitive environment online.
Furthermore, the DMA empowers users to have more control over their privacy, particularly concerning targeted advertising. Google will offer users the option to prevent their data from being utilized across its various services for ad-targeting purposes.
Similarly, Meta is introducing measures to allow users to keep their Facebook and Instagram data separate, preventing the amalgamation of personal information for advertising.
Another significant change introduced by the DMA is the requirement for interoperability among messaging systems.
- This means companies must ensure their messaging apps can communicate with one another.
- Specifically, Meta, owning the only two chat apps covered by these rules, is expected to devise a plan enabling Facebook Messenger and WhatsApp users to exchange text messages, videos, and images seamlessly, further enhancing user choice and flexibility in digital communication platforms.

Source: AP