The objective of the Digital Markets Act (DMA), the European Union law that will come into force on March 7, is clear: to reduce the concentration of power in the hands of technology giants, eliminate abuses of dominant positions and open the doors to greater competition. With this objective, the EU first of all identified the so-called “gatekeepers”: the guardians who often exploit their power to prevent the entry of new and smaller competitors.
Who are the gatekeepers? The DMA considers technology companies with at least 45 million active users per month (and 100 thousand business users per year) on European soil, a market capitalization of at least 75 billion euros and 7.5 billion in annual turnover as such. Meeting the requirements are Amazon, Apple, Alphabet (Google), Meta, Microsoft and finally Bytedance, the Chinese company that owns TikTok and the only non-US company among those identified by the EU. These giants will have to make changes to 22 of the services they offer, in the search engine sector (Google Search), social networks (Facebook, Instagram, TikTok), e-commerce (Amazon and Google Shopping), browsers (Safari and Chrome), messaging (WhatsApp and Messenger) and others. Anyone who does not comply with the new rules established by the European Union will have to pay fines of up to 10% of the annual turnover, which could rise to 20% in the event of a repeat offense.
So far, the premises of a regulation that the European Union has been working on for years and which is already considered one of the most severe in the field of competition. In practice, however, the implementation of DMA risks being complex not only for the gatekeepers, but also for the companies that should benefit from this new standard and even for the users.
Let’s go in order and see in which sectors, and with what changes, the Digital Markets Act applies.
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Messaging
The most noticeable changes for users will probably be in the area of messaging. Having (for the moment) excluded iMessage from the platforms that must comply with the DMA, the new law only applies to Whatsapp and Messenger.
In particular, the Digital Markets Act requires that messaging platforms become interoperable, i.e. that it is possible to send messages even between rival platforms (for example, by writing to a Telegram account from the WhatsApp app), all without compromising end-to-end encryption -end which protects message privacy.
Although it may seem like a bizarre feature compared to the way we are used to using platforms, interoperability is nothing different than what has always been expected from email clients, which allow you to send, for example, an email from a Gmail account to a Hotmail.
Meta (owner of WhatsApp and Messenger) has already started to equip itself to offer this alternative to users, but to exploit it it is necessary that other apps (such as Telegram, Signal or Discord) agree to connect to WhatsApp or Messenger. Which is anything but obvious.
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Search engines and e-commerce
As a de facto monopolist in the sector, Google is the only search engine that has to respond to the DMA’s requests. In particular, Google will no longer be able to take advantage of its dominant position to provide an “unlawful advantage” to its shopping services, instead giving priority to sites and portals that compare the different offers available for a product.
The objective is also to guarantee greater visibility to small and medium-sized businesses, reducing the difference with those who are able to secure, for a fee, a position at the top of the search engine page. Precisely following the entry into force of the DMA, Google decided to eliminate Google Flights, its flight comparison service.
The same logic applies to Amazon, which will no longer be able to favor its own products over those sold by independent third parties and which, as far as advertising is concerned, will have to offer more detailed reports on advertisement rates and the effectiveness of advertising campaigns .
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Browsers (and more)
In this case, there are two services affected by the DMA: Chrome and Safari. To encourage competition, Google’s Android and Apple’s iOS will no longer be able to favor their native browsers, but will have to allow the user to choose which one to install as default when starting a new device. However, this system does not only apply to browsers. In the case of Android, for example, a similar choice will also be offered for the search engine you intend to use as default and for other services (such as Google Maps). The goal, in short, is to make it easier for users to choose between competing services instead of being encouraged to use the default one.
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App Store
The DMA forces gatekeepers to allow the installation of third-party app stores (so-called “sideloading”). Nothing new for Android users, given that all this is already foreseen on the Google-owned operating system. Sideloading, on the other hand, represents huge news for Apple users, who until now have always had access exclusively to the official App Store.
However, Apple does not seem willing to benefit developers who decide to also use alternative app stores. Among the many complex economic clauses provided by the Cupertino giant, there is for example the one that requires paying 50 euro cents for each single download once the quota of one million downloads in a year has been exceeded. For the most important applications (which can reach tens or hundreds of millions of downloads per year) this is a significant outlay. Some developers have said that the alternative offered by Apple is “economically meaningless.”
Apple has also repeatedly explained how, from its point of view, opening up to competing app stores risks reducing user security.
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Data sharing
Users of Meta and the Google suite of products will now be able to choose more easily whether to allow data sharing between the various services offered by the same company. For example, it will be possible to separate your Facebook account from your Instagram or Messenger account. Likewise, it will be possible to disconnect your Chrome account from that relating to the Google search engine, Maps or YouTube, in order to limit the sharing of data and therefore the targeting of ads.
This decision, however, brings with it disadvantages. As for Meta, disconnecting the accounts of the various platforms of Mark Zuckerberg’s company means you will no longer be able to publish your posts or stories at the same time on Facebook or Instagram. If you use Facebook’s internal Marketplace, you will no longer be able to use Messenger to communicate with sellers.
As for Google, the company explained that it will no longer be possible, for example, to obtain suggestions on Maps based on searches made on Google Search. In general, therefore, choosing to disconnect your accounts will guarantee greater privacy but fewer functions.
TikTok
Among the measures taken for the DMA, TikTok has aimed to strengthen data portability: users can now download their posts and request a copy of the data for access and portability purposes. Furthermore, the introduction of a new API for data portability aims to facilitate the transfer of information to registered developers, with a focus on privacy and security. For business users, TikTok has improved access to analytics and performance data. Despite formally adhering to the DMA requirements, the Bytedance platform has announced that it will continue legal action to request that its classification as a gatekeeper be reconsidered.