The European Union has begun investigations into major tech companies such as Apple, Google, and Meta, suspecting that they are not complying with the new Digital Markets Act (DMA) designed to promote competition in digital services. This law requires dominant online platforms to provide users with more choices and competitors with more opportunities to compete. Violations of the DMA can result in heavy fines, up to 10% of a company’s global revenue and 20% for repeat offenses. The investigation also includes other tech giants like Amazon, Microsoft, and TikTok’s parent company, ByteDance, with more companies possibly being added to the list.
One of the specific practices being investigated is Meta’s “pay or consent” approach, where users in Europe can pay for an ad-free version of Facebook and Instagram. The European Commission is concerned that this binary choice may not provide a real alternative for users who do not consent, potentially leading to the accumulation of personal data by large companies. Meta defended its subscription model as a well-established business practice and stated its commitment to engaging constructively with the Commission. Apple and Google are also being scrutinized for their app stores and the constraints they may impose on app developers in terms of communication and promotion offers.
Concerns have been raised about Apple’s “choice screen” for Safari, as users must be prompted with effective and easy options to select an alternative default service, such as a browser or search engine on their iPhones. Google’s search practices are also under review to ensure fair treatment of third-party services in search results compared to Google’s own services. Both companies have stated their confidence in complying with the DMA and are committed to engaging with the European Commission during the investigation process. Google has made significant changes to its services in Europe to adhere to the law and welcomes feedback from stakeholders and third parties.
The potential fines for non-compliance with the DMA could amount to billions of dollars for the affected companies, emphasizing the importance of adhering to European competition laws. The investigations by the European Commission aim to ensure that dominant tech platforms follow the regulations set by the DMA to promote a fair and level playing field in the digital services market. As the investigations continue, the tech companies under scrutiny will continue to engage with the European Commission and defend their practices, citing efforts to comply with the law and address any concerns raised by regulators. The story is ongoing, with updates to be provided as additional information becomes available.
