DMA Gatekeepers: How Apple’s Mac is Protected from EU Antitrust Attacks and Implications for the App Store
Most tech firms are concerned about the changes that are required this week. Google has spoken of “difficult trade-offs,” which may mean its search results send more traffic to hotel or flight aggregators. Apple says that the DMA jeopardizes its security. Apple, Meta, and TikTok have all sued the EU, accusing it of unfairly targeting their services. The argument in favor of the status quo is that competition is actually thriving—just look at TikTok, a technology company launched in the past decade, now designated as one of the so-called gatekeepers.
The European Commission says a platform must meet two conditions for it to be considered a gateway. First, it must have an annual EU revenue of at least €7.5 billion in each of the last three fiscal years or an average market cap of €75 billion in the last fiscal year, while providing its core platform to at least three EU member states. It must operate a core platform with at least 45 million monthly active users in the EU and 10,000 yearly active EU business users in each of the last three fiscal years.
The commission identified specific services for each of the designated gatekeepers that it believes are subject to DMA rules. Gatekeepers can face fines up to 10% of global revenue if they fail to comply with the rules.
A number of services link to strengthen the empire, which includes a popular mobile operating system and a major search engine. That’s given it the widest range of covered services under the DMA:
The company made some changes in January and March that affected everything from data sharing to search results for EU users. The highlights include:
Some of the changes echo earlier concessions the company has made in order to avoid EU antitrust attacks. After a legal fight, the search engine choice screens were added to the chrome on avenger.
Apple is one of the highest-profile DMA targets, thanks to its expansive mobile walled garden. The iOS operating system, Safari web browser, and App Store are all designated as “core platform services,” and much of the conversation has centered on how far it will have to open them up.
The company announced on January 25th that it was introducing changes to the update that were in line with the EU’s new rules.
The changes could make things worse for developers trying to get away from Apple’s app store monopoly according to Penfrat. A proposal such as Apple’s would make it unlikely anyone would challenge the monopoly. It isn’t worth it. The EU Commission will lose the DMA if it let this pass.
Companies haven’t yet approved Apple’s offer. The only one that claims it will be available for iPad users after March 7th is Mobivention, which has announced a handful of app marketplaces. Similarly, while rival web browser providers like Google and Mozilla are seemingly experimenting with new iOS browsers, neither company has officially announced when those apps will be available.
Meta has had a history of absorbing rivals like social network and messaging services. The services covered by theDMA are in the same places.
Targeted advertising is Meta’s bread and butter, and last year it aimed to address concerns by letting users pay to avoid ads — launching a €9.99 per month ad-free tier for Facebook and Instagram, then giving the tier (as of March 1st) An additional fee is added to linked accounts. It also paused ads for users younger than 18, although its long-term plans there are less clear.
The choice to lean on a paid option resulted in a lawsuit from the European Consumer Organisation (BEUC), which claimed the “very high subscription fee” meant users “do not have a real choice.” In January, Meta announced the gradual roll out of some other data protection features, such as the ability to sever linked Facebook andInstagram accounts.
But the most exciting change for many people is the prospect of third-party cross-platform messaging, which Meta announced for its WhatsApp service last year. As the DMA takes effect, we expect more details on what third-party messaging support will look like for WhatsApp and Messenger.
The changes are being worked on even though Meta is appealing some parts of its designation. It argued in November that Messenger and Marketplace didn’t belong on the list because they were consumer-to-consumer services and did not act as a middleman. As of this week’s deadline, the challenge remains ongoing.
What is the European Commission telling us about Amazon in the EEA: How much is it paying for its products, and how much does it charge to be sold?
What Amazon hasn’t detailed yet, though, is what kind of changes — if any — it’s making to ensure its marketplace fosters competition under the DMA. The rules could mean the company can’t give its brands preferential treatment in search results or copy products from third-party sellers, both of which Amazon has been accused of in the past. And Amazon has long been the subject of antitrust scrutiny in the EU, where regulators accused it of misusing seller data to get ahead of the competition. The company settled these charges in 2022 and promised to stop using non-public data, as well as make it easier for more sellers to appear within its “Featured Offer” box (formerly called the “Buy Box”), where products get high visibility.
Amazon has committed to giving advertisers and publishers with campaigns in the EU new, expanded reports that they can access from their website. The reports contain more detailed information about how much an advertiser is paying for ads as well as how much a publisher gets from ads on a third party website or app. The company is now giving advertisers in the EU the opportunity to independently verify the success of their campaigns in a privacy-safe, cloud-based environment.
Microsoft’s Windows operating system falls under the DMA’s regulations, and that’s changing how much the company promotes — or lets users avoid — numerous other apps and services inside it.
Adding the ability to disabling Bing’s built-in web search was one of the changes that the software giant had to make. These options are available to users in EEA markets — which includes the EU countries and also Iceland, Liechtenstein, and Norway.
ByteDance’s inclusion has a unique political dimension here, cutting against some critics’ arguments that the EU is unfairly targeting American companies. (A second non-US-based company, Samsung, was initially named but later removed from the gatekeeper list.) California Democrat Lou Correa, who is the ranking member on the US House Judiciary subcommittee on antitrust, led a letter with more than 20 bipartisan colleagues to criticize EU policies for clear targeting of US companies. The lawmakers criticized the European Commission for not naming Chinese firms, despite the fact that they are competing with US firms in the EU and other markets.
Gatekeepers against the European Commission’s DMA: implications for TikTok, a new app-based activity tracking system and a warning to Google, Amazon, Google and Google
ByteDance wrote about how Tik Tok will comply with the DMA. The platform launched an API that will let European users transfer their data to other apps that have registered with TikTok to use the tool. Users can give permission for developers to port TikTok activity to their own apps. Individual users can now export and download their own data from the “Download your Data” tool. It will have data transfer solutions for business accounts.
The company claims that TikTok is the most capable challenger to more entrenched platform businesses. The commission used ByteDance’s global market cap as a basis for its analysis and the company believes that TikTok doesn’t meet the revenue threshold.
All of the gatekeepers being targeted by the DMA still need to get their proposals approved by the European Commission. The bloc would take strong action if it felt that the solutions being proposed aren’t good enough, an EU commissioner said in January.
In theory, that means big changes for EU residents’ digital lives. Users of iPhones should soon be able to download apps from places other than Apple’s app store; Microsoft Windows will no longer have Microsoft-owned Bing as its default search tool; Meta-owned WhatsApp users will be able to communicate with people on rival messaging apps; and Google and Amazon will have to tweak their search results to create more room for rivals. There will also be limits on how users’ data can be shared between one company’s different services. Up to 20% of global sales revenue can be fined for noncompliance. The EU can use thenuclear option to force tech companies to sell parts of their business.
Apple Shouldn’t Allow Meta to Host a Peculiar App Store: A Case Study of Tech Feudalism in the EU
For apps with a limited number of users, those fees can be too much for them if they become victims of their own success. An example given is that Meta would need Apple to fork over at least 135 million dollars a year to host only one app on a competing store.
Apple blamed the DMA when it decided to drop support for PWAs in the EU. After facing a potential investigation from the EU, the company has walked back that decision. PWAs will have to be built using the WebKit Engine which is used in both Apple and Microsoft products. As one of its responses to the DMA, Apple is allowing third-party browsers to use their own engines in iOS in the EU. But PWAs downloaded through those browsers will still be reliant on Safari’s WebKit.
Citizens of the European Union live in an internet built and ruled by foreign powers. People in the EU use an American search engine, shop on a US website, and scroll through American social media feeds.
In his 2023 book, Technofeudalism, Yanis Varoufakis argues the big US tech platforms have brought feudalism back to Europe. The former Greek finance minister sees little difference between the medieval serf toiling on land he does not own and the Amazon seller who must subject themselves to the company’s strict rules while giving the company a cut of each sale.
