Tech giants facing EU scrutiny
What are the main reasons behind the European Commission’s initiation of noncompliance investigations against tech giants like Apple, Meta, Google’s parent Alphabet, and Amazon? How does the Digital Markets Act (DMA) aim to regulate ‘gatekeepers’ and ens
Vestager, Executive VicePresident in charge of competition policy at the Commission said in a press statement, adding, “But we are not convinced that the solutions by Alphabet, Apple and Meta respect their obligations for a fairer and more open digital space for European citizens and businesses”.
How are the steering rules non-compliant?
DMA provisions stipulate that app developers be allowed to steer consumers to offers (and services) outside the gatekeeper’s app store, free of charge.
The Commission aired its concerns about Alphabet and Apple not being fully compliant “as they impose various restrictions and limitations.” Apple has maintained that the tight integration associated with its App Store is essential to provide a “uniquely secure and seamless user experience.”
“It (DMA provisions) equates size with harm, and then imposes a onelistfitsall set of regulatory obligations without providing an opportunity for the platform to explain, and the regulator to assess, whether — on balance — there are broader benefits to consumers or businesses,” Apple had said in an unrelated January 2020 submission.
In a blog published this January, Spotify, however, had the following to say: “For years, even in our own app, Apple had these rules where we couldn’t tell you about offers, how much something costs, or even where to buy it.” It added that with the DMA, it would be able to share details about Spotify promotions, deals and bettervalue payment options with consumers in the EU.
Further, the Competition Commission of India (CCI) on March 15 also ordered a detailed probe against Google for alleged discriminatory practices on its Play Store pricing policy after having discovered a prima facie violation of competition law.
What about Alphabet engaging in self-preferencing?
The Commission wants to determine whether Google search results are discriminatory; in other words, whether the search giant engages in selfpreferencing for its verticals over rival services. It has stated that Alphabet’s measures to comply with the DMA may not have ensured that thirdparty services featured on Google’s search results page are treated in a “fair and nondiscriminatory manner” in comparison to their own services.
In October 2020, the U.S. Department of Justice (DoJ) accused Google of “unlawfully maintaining monopolies through anticompetitive and exclusionary practices in the search and search advertising markets” and sought it “remedy the competitive harms.” According to the DoJ, the conduct harmed consumers by reducing the quality of their search, lowering choices, and impeding innovation. The case is ongoing.