The European Union (EU) is launching investigations into tech giants Apple, Google, and Meta (Facebook’s parent company) over concerns they might not be following a new law designed to promote fair competition in the digital market.
The Digital Markets Act (DMA), which came into effect earlier this month, requires dominant online platforms to give users more choices and provide a level playing field for competitors. The EU Commission suspects practices by these companies fall short of full compliance with the DMA and could result in “heavy fines” if investigations reveal violations.
Fines Could Reach Billions
Fines under the DMA are significant, reaching up to 10% of a company’s global revenue for the first offense and doubling for repeat offenders. This translates to potential tens of billions of dollars for most of the targeted companies.
Investigating Specific Practices
The EU is looking into several practices by these tech giants. One area of concern is Meta’s “pay or consent” model, where users can pay to opt out of personalized ads. The EU fears this might not be a genuine choice and could pressure users into surrendering personal data. Meta argues that subscriptions are a standard business practice and their offering complies with the DMA.
Another point of scrutiny is the app stores controlled by Apple and Google. The DMA mandates that these “gatekeepers” allow app developers to direct users to alternative app stores and payment methods outside their own platforms, free of charge. The EU suspects Apple and Google might be hindering developers’ ability to promote alternative offerings and impose unfair charges.
Apple’s “choice screen” for its Safari browser is also under investigation. The DMA requires Apple to present users with a clear option to choose a different default browser or search engine on their iPhones. Apple maintains their plan adheres to the DMA.
The EU also has concerns regarding Google Search. The Commission suspects Google might not be treating third-party services appearing in its search results fairly compared to its own offerings like Google Shopping and Flights. Google claims to have made significant changes to comply with the DMA and will defend its approach.
The investigations highlight the EU’s stance on promoting a more competitive digital landscape and protecting user privacy. The outcome of these probes could set a precedent for how big tech companies operate in the European market.
The European Union (EU) is launching investigations into tech giants Apple, Google, and Meta (Facebook’s parent company) over concerns they might not be following a new law designed to promote fair competition in the digital market.
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