Apple, Alphabet’s Google, and Meta Platforms will undergo scrutiny for potential violations of the EU’s newly implemented Digital Markets Act, European antitrust regulators declared on Monday, signaling possible substantial fines for these tech giants.
The EU legislation, which took effect on March 7, seeks to challenge the dominance of tech behemoths by facilitating easier transitions between competing online services such as social media platforms, internet browsers, and app stores.
This move aims to create opportunities for smaller companies to enter the market. Breaches of this law could lead to fines of up to 10% of the companies’ global annual turnover.
Simultaneously, U.S. antitrust regulators are also intensifying scrutiny of Big Tech over alleged anti-competitive behaviors, a crackdown that might result in the breakup of these companies.
While tech firms assert deploying numerous engineers to meet the Digital Markets Act’s requirements, the European Commission expressed suspicion that these efforts might fall short of effective compliance.
EU industry chief Thierry Breton defended the swift investigations, stating that adherence to the law should not be delayed.
The investigations center on Apple’s adherence to obligations regarding software application uninstallation, default settings modification, and access to choice screens on its iOS operating system.
Additionally, regulators are examining whether Apple limits app developers’ ability to inform users about external offers outside its App Store.
Similarly, Alphabet faces scrutiny over “steering” practices, potentially favoring its vertical search engines like Google Shopping, Google Flights, and Google Hotels over competitors and possibly discriminating against third-party services on Google search results.
Moreover, the Commission highlighted concerns regarding the fee structures of Apple and Alphabet, which allegedly contravene the DMA’s requirement for certain services to be “free of charge.” Both companies recently introduced new fees for certain services.
Meta’s subscription service without ads, introduced in Europe last November, drew attention for potentially conflicting with regulatory obligations.
Meta indicated its commitment to comply with the act’s guidance, defending its Subscription for No Ads service as aligned with established business models and regulatory requirements.
Google asserted making substantial changes to its services and pledged to defend its approach in the ensuing months.
Apart from Apple and Alphabet, the Commission is also investigating Amazon’s ranking practices in its marketplace.
Amazon, designated as a DMA “gatekeeper,” maintained compliance with the Digital Markets Act and engaged constructively with the European Commission, according to a spokesperson.
The EU executive aims to conclude the investigations within a year, as outlined under the DMA. It has instructed the companies to retain specific documents to facilitate current and future probes, amid growing criticism from app developers and business users about perceived shortcomings in compliance efforts.
