They have six months until March 7 to comply with the rules.
London:
The European Union on Monday launched an investigation into Alphabet, Apple and Meta over possible violations of a landmark new law aimed at preventing big tech companies from having an unfair advantage over rivals.
Last year, Brussels designated six companies as “gatekeepers” under the Digital Markets Act (DMA), meaning they are big and powerful enough to require additional regulation: Alphabet, Amazon, Apple, Meta, Microsoft and TikTok Owner Words beat.
They have six months, until March 7, to comply with the rules, which are designed to open up commonly used popular technology platforms and give users more choice.
Non-compliance can result in fines of up to 10% of a company’s global annual turnover. The European Commission hopes to complete its investigation within a year.
Below is a summary of the main areas of investigation:
Anti-steering:
Two of the five investigations related to Alphabet and Apple’s payment systems, specifically around “anti-steering” practices.
Whenever you make an in-app purchase on your iPhone or Android device (such as ordering takeout or upgrading to a premium version of Strava), Apple or Alphabet typically charges a fee.
To get around this, app developers sometimes “direct” consumers to their own sites, encouraging them to pay them directly so they can avoid the additional fees of big tech companies.
Apple has been accused of counter-steer behavior.
Earlier this month, the European Union fined the tech giant $2 billion for blocking music streaming service users from receiving discounts and promotions outside of its payments ecosystem.
The move in Brussels was welcomed by Spotify, which accused Apple of preventing rivals from sharing benefits with its users.
In addition to music streaming, the EU is currently investigating whether Apple and Google are preventing more consumers from accessing services beyond their control.
Self-preference:
In brick-and-mortar retail, supermarkets sometimes sell cheaper own-brand alternatives on the shelves next to more expensive items.
Things get even more complicated for online markets, where tech companies have been accused of giving themselves an unfair competitive advantage by displaying their products more prominently than their competitors.
Another of the five EU investigations concerns whether Google prioritizes its own services, such as Google Hotels or Google Flights, when users enter queries into its search engine, which could limit competition from the likes of Booking.com or Skyscanner opponent’s business.
The European Union said on Monday it was also investigating whether Amazon prioritized its own products over competitors in its online store, but it did not launch an investigation.
What else is the EU investigating?
According to the DMA, Apple should make it easy for device users to uninstall software and change default settings, such as their preferred web browser or search engine.
The EU said it was concerned the company was not making the choices it should have been simple for users and would investigate.
The law also requires gatekeeper platforms to obtain explicit consent from users if they intend to combine personal data across different platforms, such as Meta’s Facebook and Instagram.
To comply, Meta has introduced a “pay or be tracked” policy that will charge consumers who don’t consent to their data being collected and combined €9.99 ($10.82) for an ad-free version of the app.
Meta last week said it might lower the fee to 5.99 euros after questions were raised about the legality of the subscription package.
On Monday, the EU said the binary choice did not constitute a real alternative for users and would investigate.
What do these companies say?
Google made significant changes to its services ahead of the deadline and said it would defend its practices in the coming months. Apple said it was confident its plan met the DMA’s requirements.
A Meta spokesperson said the company is working to comply with the act’s guidelines.
Meta said: “Subscriptions as an alternative to advertising are a well-established business model in many industries, and we designed ad-free subscriptions to address multiple overlapping regulatory obligations, including DMA.”
(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)
