The European Commission has opened investigations into Google, Apple and Facebook's parent companies due to concerns that they are not fully complying with their obligations under the Digital Markets Act.

Mary Lennighan

March 25, 2024

3 Min Read

In a nutshell, Brussels believes – probably correctly – that the Internet giants are not playing fair when it comes to competition regulations, and is moving quickly to make a point about the efficacy of the act.

Well, fairly quickly. The Digital Markets act came into force in May last year, after several years in the pipeline, and in September the European Commission identified six companies, the aforementioned among them, as 'gatekeepers,' giving them six months to comply fully with the requirements of the act. So the Commission has had plenty of time to decide what it would do by the time that six-month deadline expired on 7 March.

It has given itself a year to complete the investigations, after which point it will share the measures it is considering taking, reminding us that ultimately, it could levy a fine of up to 10% of a companies global turnover – 20% for repeat offenders – and/or impose other requirements. It will be some time before we get to that point though.

For now, we have details of the five investigations the Commission plans to carry out as part of its ongoing battle with the US-based tech giants.

In the case of Apple and Google parent Alphabet, two of the investigations will focus on anti-steering. Under the Digital Markets Act, gatekeepers are not permitted to prevent app developers from steering consumers to offers outside of app stores. This has been a hot topic in Brussels, with Apple currently appealing a hefty €1.8 billion fine for preventing streaming providers like Spotify from enabling customers to sign up for cheaper services outside of the App Store. Apple has since amended its T&Cs and introduced new charges, but most people are not convinced that it has fully brought itself into line with the act and the EU has an eye on that new model too.

Meanwhile, Apple also stands accused of restricting customer choice on browsers and search engines in iOS. And Alphabet is being probed with regard to its Google search practices – plus ça change – with the Commission concerned it is prioritising its own services to the detriment of those of third parties.

The fifth investigation is about Meta's much-discussed 'pay or consent' model, which allows it to capture users' data on Facebook and Instagram, unless they pay a subscription fee to opt out. The Commission is not keen on the binary choice element of that offer.

In addition, the Commission has an eye on whether Amazon is giving preference to its own products on the Amazon Store, but that seems to be a fact-finding mission at this stage.

"We have been in discussions with gatekeepers for months to help them adapt, and we can already see changes happening on the market. But we are not convinced that the solutions by Alphabet, Apple and Meta respect their obligations for a fairer and more open digital space for European citizens and businesses," said the EU's internal market commissioner Thierry Breton, in a statement. "Should our investigation conclude that there is lack of full compliance with the DMA, gatekeepers could face heavy fines."

The outgoing Commission is clearly keen to be seen flexing its muscles against the tech giants. And the smart money is on the investigators finding evidence of the infractions the Commission has warned about. But the so-called gatekeepers are unlikely to take any judgements against them lying down.

About the Author(s)

Mary Lennighan

Mary has been following developments in the telecoms industry for more than 20 years. She is currently a freelance journalist, having stepped down as editor of Total Telecom in late 2017; her career history also includes three years at CIT Publications (now part of Telegeography) and a stint at Reuters. Mary's key area of focus is on the business of telecoms, looking at operator strategy and financial performance, as well as regulatory developments, spectrum allocation and the like. She holds a Bachelor's degree in modern languages and an MA in Italian language and literature.

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