Barely two weeks after the entry into force of the Digital Markets Act (‘DMA’) (see EUROPE 13366/38), the European Commission announced on Monday 25 March that it had opened five investigations into breaches of EU law. Three companies are involved: Apple, Meta and Alphabet, Google’s parent company.
The non-compliance investigations are to look at Google’s search results, which allegedly favour its own services and products, Apple’s new business model and app shop, and Meta’s ‘pay or consent’ model, under which Facebook users can pay a monthly fee to avoid targeted advertising.
“Certain compliance measures presented by gatekeepers do not achieve their objectives and do not meet expectations. The feedback we have received has not resolved the problems we raised”, said Margrethe Vestager, the Commission’s Executive Vice-President responsible for Competition, at a press conference.
Referencing and personal data
Both Apple and Alphabet are being targeted for their practices within their respective app stores, the AppleStore and the Google Play Store.
The DMA requires gatekeepers to allow app developers to ‘steer’ consumers to offers outside the gatekeepers’ app stores, free of charge.
The Commission is concerned that certain measures taken by Alphabet and Apple may not be fully compliant with this obligation, as they impose various restrictions and limitations.
Alphabet is also suspected of favouring its own products and services in Google searches (Google Flight, Google Hotels, etc.) to the detriment of listings for competing products. For Apple, the finger is being pointed at compliance with obligations relating to user choice when installing apps or choosing the main browser.
As for Meta, the ‘pay or consent’ model, which requires users to pay to avoid personalised advertising, is in the Commission’s sights, as it fears a binary choice that “offers no real alternative” if users do not give their consent.
“We are very clear that this is not a question of price, but of free, less personalised alternative options that do not have a negative impact on the user experience”, insisted Thierry Breton, European Commissioner for Internal Market.
Last week, several working groups were held to fuel the debate between the major platforms presenting their compliance reports and Commission officials. For the latter, these groups have been useful, but “we already knew what the gatekeepers had in mind in terms of compliance, and what we would disagree with. This was useful in carrying out and completing the assessment, but it also explains how we were able to take these decisions so quickly”, explained a senior European official.
At this stage, the Commission has an official deadline of twelve months to conclude the procedure opened on Monday. But it could come to its conclusions more quickly.
This decision was swiftly criticised by the Computer and Communications Industry Association (CCIA), one of Europe’s largest technology business lobbies. In a press release, Daniel Friedlaender, senior vice-president and head of CCIA Europe, denounced the European Union’s “haste”, seeing it as “a worrying signal”. In his view, the EU “could be jumping the gun into investigations without knowing what it is investigating”. “This calls into question the idea that businesses and the Commission are working together to successfully implement the DMA”, said the CCIA.
In addition, the Commission has launched investigations into Apple’s new pricing structure for alternative app stores and Amazon’s ranking practices for its own products.
This series of European investigations is being launched at a time when Apple has just been taken to court in the United States for monopolistic practices. (Original version in French by Isalia Stieffatre)