Tech giants Alphabet (owner of Google), Amazon, Apple, China’s TikTok’s ByteDance, Facebook’s Meta and Microsoft have been named as ‘gatekeepers’ under EU digital markets law, the European Commission announced on Wednesday. (September 6).
A total of 22 “core platform services” provided by these online gatekeepers now have six months, until March 2024, to comply with strict rules aimed at promoting fair competition and giving users more power over their devices.
The list includes social media companies such as TikTok, Facebook, Instagram, Google’s Chrome and Apple’s Safari, Android and iOS operating systems, YouTube, messaging services like WhatsApp, Google advertising services, Apple and Windows, as well as others like Google Maps. , Amazon Marketplace and the Apple App Store.
However, potential new designations for gatekeepers could be announced in February 2024, meaning this list could be expanded.
The European Commission has launched a market investigation to assess whether Apple’s iMessage and Microsoft’s services (Bing, Edge and Microsoft Advertising) should be added to the list.
Although these platforms meet the threshold required to be designated as gatekeepers, Microsoft and Apple have argued that these services cannot be considered “gateways”.
Similarly, the EU executive launched an investigation into Apple’s iPadOS due to its importance in the market and despite it not meeting the thresholds.
“Guardians” are defined as tech giants that have achieved annual revenue of at least €7.5 billion in the past three years and have at least 45 million monthly active users on an online platform in the EU.
Under the Digital Marketplace Act, these companies will not be allowed to block users from uninstalling pre-installed software or apps, “self-prefer” their products, or decide which app store users should have.
Google’s Oliver Bethell said in a blog post that the company’s goal is “to make changes that meet new requirements while protecting the user experience and providing useful, innovative and safe products to citizens. Europeans”.
But Wednesday’s announcement nonetheless drew criticism from TikTok’s ByteDance.
“We support the goals of the DMA but fundamentally disagree with today’s designation decision,” a spokesperson said. said in a report. She said the decision risked undermining the overall purpose of the new law by protecting “real gatekeepers” from “new competitors”.
Who is not on the list
The EU executive excluded Gmail, Outlook.com and the Samsung internet browser from the list of controllers, despite meeting the thresholds.
Notably, cloud services such as Amazon Web Services (AWS), Microsoft Azure and Google Cloud, which dominate the market for cloud infrastructure services in the EU, have also been left out.
Elon Musk’s X, better known by his former Twitter name, is also not on the list.
According to Jan Penfrat, expert at EDRi, based in Brussels, even if Twitter “has more than enough monthly active users in the EU to be eligible, the company should not have a significant impact internally “. market” measured by its annual turnover. »
Companies designated as access controllers will have to present a report to the commission, detailing how they will comply with the obligations laid down by the new European legislation.
Tech companies will face fines if they break the law. However, how the bloc of 27 countries will ensure effective compliance remains unclear.
“The Network Effect”
One of the aims of the new European law is to allow European start-ups and developers to compete with American and Chinese tech giants in a fairer environment.
For years, Apple and Google have charged app developers entry fees for their online stores, but some popular app developers like Sweden’s Spotify have complained about the high fees.
The Digital Marketplace Act aims to boost competition in app stores by giving consumers the ability to download apps from other stores and choose how to pay for in-app sales.
However, experts say the new obligations are unlikely to weaken the market power of Google and Apple.
“DMA tends to ignore the benefits. It bets that price competition could overcome the force of gravity of network effects,” wrote economist Bertin Martens earlier this year.
“App developers want to be where consumers are, and vice versa, which means developers need to be present in both Apple and Google Play stores, while consumers are not incentivized to switch to other stores because it wouldn’t give them access to more apps. “, revealed his analysis.