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Big tech companies are changing much of the technology underlying their services and European users will soon notice it: all because the rules of the Digital Markets Act come into force on Thursday, the regulation that Europe wanted to rebalance competition in digital markets.
With fines of up to 10 percent of global turnover, which double in the event of a repeat offense: a nice disincentive. It is not surprising that big tech is starting to announce important changes, although some innovations may still require months and a tug-of-war with Europe to fully express themselves. The changes that big tech are now making are in effect “proposals” to adapt to the DMA, which the European Commission will have to evaluate.
We remind you that platforms with an annual turnover of at least 7.5 billion euros within the EU in the last three years, a market valuation exceeding 75 billion euros, at least 45 million monthly end users, fall under the Digital Markets Act and 10 thousand corporate users established in the EU. The European Commission believes that there are 22 platforms: social networks (TikTok, Facebook, Instagram and LinkedIn), browsers (Safari and Chrome), operating systems (Google Android, iOS and Windows PC Os), software for advertising spaces (Google, Amazon and Meta), intermediation services (Google Maps, Google Play, Google Shopping, Amazon Marketplace, App Store and Meta Marketplace) and messaging services (WhatsApp and Messenger); Google Search (as a search engine) and YouTube (as a video sharing platform).
Here’s a breakdown of the actions taken by each of these companies, at least so far.
Apple
Apple is perhaps the company most impacted, because it is also the one that has so far kept the tightest control over its platform. It will be forced to relax it, although it is not yet entirely clear to what extent it will do so. Three new features. Access to alternative app stores: For the first time, Apple will allow iPhone and iPad users to access competing app stores, thus increasing consumer choice. Alternative Payment Systems: It will allow the use of alternative payment systems, thus reducing the dependency of apps on Apple’s payment ecosystem. Default browser selection: New users in Europe will have the option to select a default browser other than Safari when setting up their devices. Europe believes that the “default ” has a strong power over user choices, in fact. Behind this assumption there is also the US Antitrust action against the agreement with which Google pays Apple to make its search engine the default on iPhones. With access to alternative stores, Apple does not actually eliminate its commission imposed on developers. Apple gives them three options in Europe now: Developers could maintain the status quo of the App Store and pay up to 30% commission on sales. Or they could reduce the commission to 17% and add a new fee of 50 euro cents for each download over one million per year. Third option: avoid Apple’s commission by selling through a competing app store, but in this case still paying the download tax. Apple has said that the plan complies with the law and that 99% of European Union developers will reduce or maintain fees owed. App makers are protesting, saying the plan violates the letter and spirit of the law. Under the new rules, a tech giant like Apple would have to allow app creators to sell subscriptions and services outside of their apps “for free,” said Damien Geradin, a European antitrust lawyer who advises app developers. European regulators will rule on Apple’s proposed compliance with the DMA only after Thursday’s effective date. If they were to open a formal investigation, it could open up a long legal battle that could force Apple to change or risk expected fines. The climate on these issues is already hot. Apple was just fined €1.8 billion by the European Commission for anti-competitive behavior in its App Store. The Commission found that Apple discriminated against Spotify and other music apps by preventing them from informing customers about alternative, cheaper subscription methods outside of the app. Again for competitive reasons, Apple is also making it easier for Android users to interact with its iMessage product, under pressure from the American authorities and with effects that we could also see here, even if Apple is not obliged to do so: iMessage is not included in the DMA for Europe.
Meta and TikTok
Facebook, Instagram, Tiktok stop showing personalized advertising to minors. No more users will be shown ads based on their ethnicity, political opinions or sexual orientation. Users of TikTok and Instagram now – as on other social networks – can also choose to see posts without recommended content chosen by an algorithm based on their personal data. Meta has also introduced a subscription for those who want to stop seeing advertising (9 .99 euros on the web, 12.99 euros on smartphones), to meet the requests of the European Commission, which however a few days ago opened a formal investigation into this choice, to verify its correctness. Meta now also allows you to limit the sharing data between several of its networks, Instagram, Facebook, Messenger etc. It is also modifying Whatsapp to allow users to communicate with users of other chat apps, while maintaining encryption. For the user to actually benefit from this innovation, other apps, such as Telegram, also need to agree. And it’s not a given. They, unlike Meta, are not subject to the DMA.
These limits on personalized advertising also apply to Google, which also implements three new features. Reducing the visibility of your services: you will make your services less visible in search results, thus offering more space to competitors. A point on which he has already been beaten by the EU Antitrust. Similarly, in search results for specific categories such as flights and restaurants, Google will ensure a stronger link to competitor sites. Third, the limitation of data sharing: European users will have the option to limit the sharing of personal data among various Google services, such as search, YouTube and Chrome.
Microsoft
Microsoft is making changes to its Windows to comply with the DMA, among other things by allowing you to uninstall all its applications from the system – including Edge and Bing – and strengthening users’ choices on which apps to set as default. Furthermore, at the moment, l The integration of Windows with artificial intelligence Copilot cannot start in Europe precisely because of the DMA rules; while waiting for Microsoft to complete the adaptation process on this front too.