EU Commission Opens Competition into Apple, Google, and Meta’s Non-compliance with the Digital Markets Act (DMA)
The European Commission is opening five non-compliance investigations into how Apple, Google, and Meta are complying with its new Digital Markets Act antitrust rules, the regulator announced today. “We suspect that the suggested solutions put forward by the three companies do not fully comply with the DMA,” the EU’s antitrust chief Margrethe Vestager said in a statement. To make Europe’s digital markets open and contestable, we will be investigating the companies’ compliance with the DMA.
Additionally, the EU regulator is also looking into the fee structure Apple announced for distributing apps outside of the App Store, as well as whether Amazon is self-preferencing its own products on its store. The Commission has given Meta more time to make Messenger compatible with other messaging services.
At the beginning of this month, the six major tech companies had to start complying with the rules. These include having to give customers the option of changing default apps and uninstalling the gatekeeper’s pre-installed applications, a ban on ranking a gatekeeper’s first-party services higher than rivals, and allowing third-party app stores.
The announcement follows fierce criticism of how Apple in particular is complying with the Digital Markets Act. Although the company is allowing alternative app stores on iOS as required by the new rules, it’s doing so with a new fee structure that its critics claim will dissuade developers from distributing apps outside of Apple’s App Store. Spotify called Apple’s compliance “a complete and total farce” while Epic CEO Tim Sweeney called the changes “a new instance of Malicious Compliance.”
The “pay or consent model” has been the subject of complaints from various EU watchdogs. Last year, it launched a new paid tier for Facebook and Instagram in the EU that allows users to pay €9.99 a month to use each service without ads. The subscription was designed to be a way to get user consent to collect their data if they decide not to pay, but the Commission is concerned with the “binary choice” that Meta is offering. Last week, Meta said it had offered to reduce the monthly price of ad-free access to €5.99 a month to appease regulators.
Following weeks of criticism directed at Apple by developers, the EU’s competition chief Margrethe Vestager said a formal investigation would focus on two elements of the smartphone maker’s business: the limits Apple places on developers trying to link from the App Store to their own websites, and how hard Apple makes it to replace default, native apps like Photos or iCloud with third-party alternatives.
Competition officials from both the US and the EU have turned to Apple as a focal point for their work. The EU announcement on Monday comes after the US Department of Justice filed a lawsuit last week, claiming that the manufacturer of the iPhone had created a monopoly that was suppressing competition and harming consumers.
The lawsuit cited four internal Apple emails that, the DOJ claimed, illustrate how executives knowingly restrict users and developers in unfair ways. In one exchange from 2010, Apple cofounder Steve Jobs and an unnamed Apple executive discussed how a new ad for Amazon’s Kindle gave the impression that it is easy to switch from iPhone to Android. The executive wrote that it was not fun to watch.
