With the Digital Markets Act, the EU wants to keep the market power of tech companies in check. Because Google parent Alphabet, Apple and Facebook parent company Meta have not adhered to the new law, the EU Commission is now investigating. There is a risk of billions in fines.
The European Union (EU) has initiated investigations against Apple, Alphabet subsidiary Google and Facebook parent Meta due to alleged violations of the Digital Markets Act (DMA). According to suspicions from Brussels, companies are not doing enough to adhere to the requirements of the new law for digital markets, as the Commission announced on Monday. With the law, the EU wants to limit the market power of digital companies; if they violate it, they face fines running into the billions.
Since the law came into force at the beginning of March, companies have already announced changes, emphasized EU Digital Commissioner Thierry Breton. “However, we are not convinced that the solutions proposed by Alphabet, Apple and Meta meet their commitments,” he explained. The Commission has been in discussions with companies “for months” to help them adapt to the new rules.
EU: Alphabet, Apple and Meta gain unfair competitive advantages
The competition watchdogs are investigating, among other things, whether Alphabet is giving its own services such as Google Maps or Google Shopping an unfair competitive advantage in the Google search engine results list. In the case of Apple, the Commission raised concerns because iPhone users sometimes cannot delete pre-installed apps and cannot change some default settings on their cell phones.
Alphabet and Apple are also accused of indirectly forcing app developers to use their in-house app stores. On cell phones with the Alphabet operating system Android this is the Google Play Store; on iPhones, Apple’s App Store is preinstalled. According to the allegations, the companies prevent other providers from providing information about prices or concluding contracts without using the respective app store. Apple emphasized that the latest adjustments to the guidelines for the App Store are, from the company’s perspective, DMA-compliant.
The investigation into the Meta Group is about a much-criticized payment model for the Facebook and Instagram platforms: users can pay a monthly fee of at least 9.99 euros if they no longer want to see advertising. Only those who accept personalized ads can continue to use the platforms for free. The EU Commission suspects that users are indirectly forced to pass on their data.
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Violations could result in billions in fines
With the Digital Markets Act (DMA), the EU wants to limit the market power of so-called gatekeepers of the Internet. The stricter rules have been in effect since the beginning of March for Google parent Alphabet, Amazon, Apple, Tiktok parent Bytedance, Meta and Microsoft.
Violations can result in penalties of up to ten percent of global annual sales. According to its own statements, the EU wants to complete its investigation within twelve months.
Source: Stern
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