EU Aims to Open Up Big Tech’s Walled Gardens with Digital Markets Act

Posted on March 25, 2022 by Laurent Giret in Cloud with 25 Comments

Image credit: Håkan Dahlström

The European Union could soon force Apple, Google, Meta, and Microsoft to change their commercial practices in a pretty big way. Yesterday, EU Parliament and Council negotiators reached a consensus on the Digital Markets Act (DMA), a new set of rules aiming to limit the power of the biggest technology companies.

The new text, which could become applicable later this year, will target companies with a market capitalization superior to €75 billion or an annual revenue of at least €7.5 billion. These “gatekeepers” in the eyes of the EU must also offer services such as web browsers, messaging apps, or social media platforms at least 45 million monthly users in the US.

One of the major implications of the Digital Markets Act would be that the biggest messaging apps such as WhatsApp, Facebook Messenger, or iMessage would need to become interoperable with “smaller messaging platforms.” The EU’s press release echoes the words of Google Senior Vice President Hiroshi Lockheimer, who recently described Apple’s iMessage lock-in as “a documented strategy” to sell more iPhones.

The Digital Market Act will also include new rules related to data collection and default apps on various platforms. “Parliament also ensured that combining personal data for targeted advertising will only be allowed with explicit consent to the gatekeeper. They also managed to include a requirement to allow users to freely choose their browser, virtual assistants or search engines,” the press release reads.

The Mozilla Foundation, which has been a big supporter of making the Internet open and accessible to all praised EU lawmakers for their forward-thinking approach. “The EU Digital Markets Act (DMA) gives consumers and businesses more freedom to deploy and use a variety of non big-tech software that can shape our lives in pivotal ways. We commend EU lawmakers for their speed and ambition in adopting these rules but we can’t rest on our laurels – we must now ensure the rules are implemented and enforced robustly and effectively,” a Mozilla spokesperson said.

The Digital Markets Act still needs to be finalized and approved by both the EU Parliament and Council, and that process could be completed in late 2022. Gatekeepers who won’t comply with the rules will expose themselves to a fee that could go up to 10% of their total worldwide revenue in the preceding financial year, which is quite significant. “In case of systematic infringements, the Commission may ban them from acquiring other companies for a certain time,” the EU also said.

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Comments (25)

25 responses to “EU Aims to Open Up Big Tech’s Walled Gardens with Digital Markets Act”

  1. vladimir

    Thanks god the EU exists. Can you imagine there are so many people against it, even in the EU?

    • Bart

      No I can't really. It's mostly because people read something and then have a kneejerk reaction. If you think about it, nothing will change if you don't want to. Greetings from the EU by the way.

    • dftf

      While I'm sure overall it's a good-thing the EU exists, can you actually cite any major-victories the Commission has-had in relation to the tech-giants? I usually only hear about them taking the Commission to the ECJ, who then vastly-reduce the fines, or overturn them... any notable examples?

    • behindmyscreen

      Because people know what it means when it happens. It means that we are putting phones into the same position PCs were 20 years ago. It will be great for developers and suck ass for consumers.

  2. pungkuss

    I wish the EU were more specific with their regulations. These all seem like good things until you ask yourself how all this would work. How does iMessage keep encryption if it has to be compatible with other messaging services? Did they just mean a fallback, like RCS? Isn't competition people competing with different ideas and the best ones win? How are we to have different ideas if we have to be interoperable? Are we banning unique emojis? Every EU regulation sounds great until you try to ask yourself how you would implement this. I just think all the American tech companies just need to create separate versions of their apps for Europe. When the rest of the world see the dumpster fire the results are, then maybe we can have more specific regulation. BTW regulations do not work when they target individual companies. Regulate to the results that we want. We don't say only large car companies have to follow safety rules when creating cars. Create the regulations for everyone. BTW tech has shown us time and time again that we displace giants with new different innovation. Not some smaller company creating the same things with slight improvements. What comes after messaging apps, what comes after the browser, what comes after the smartphone, what comes after the search engine. Prevent the giants from buying those companies. That is how you do it.

    • ianbetteridge

      I’ve seen a fair few hot takes along the lines of “iMessage will have to support RCS”, which is, of course, nonsense. More likely WhatsApp will support SMS and MMS, making it instantly interoperable with Google, Apple, and pretty much every other significant messaging client.

      And on the messaging side this is far worse for Meta than it is for Google or Apple. Both WhatsApp and FB Messenger gather data (like location) which can only be captured client side. So they need people to install their apps, which is much less likely if you can message your WhatsApp using friends direct from iMessage/Google Messages. And remember: in most of Europe WhatsApp is easily the dominant messaging platform. In the uk it’s used by about 80% of all phone users monthly, compared to about 30% for iMessage.

    • spacein_vader

      Google was Yahoo with slight improvements. Facebook was MySpace with slight improvements. Amazon was Barnes & Noble with slight improvements.

  3. red.radar

    Reading the EU Summary of the Digtal Markets Act:

    • ensure the interoperability of their instant messaging services’ basic functionalities

    Oh fun…. Does this mean that WhatsApp will get my phone number without my consent? I guess yes because it is needed to enable interoperability.

    I was hoping it was a simpler approach of forcing Apple to release iMessage on another platform. This is worse.

    Maybe Apple can protect its users by allowing them to disable any interoperability functionality.

    What does this mean for private platforms like Signal…. how does this effect E2E encryption….

    Lots of questions… this looks messy

    • ianbetteridge

      “Basic” means SMS/MMS level. Which of course Google, Apple and many other chat apps already support. WhatsApp doesn’t, so expect that to change.

  4. dftf

    Sounds good, but we all know nothing much will actually change.

    The huge tech-giants will either just decide to risk any fine, as what's €300 million if you're making something like $100bn in profit? (And usually when they take the Commission to the ECJ, the fine either gets overturned or reduced, too).

    OR they'll just workaround the wording of the rules. "You said we couldn't PRE-INSTALL a browser on the device. We didn't. We merely put an icon there, which opens the store so the user can then download it. We PRE-SUGGESTED a browser, you could say".

  5. red.radar

    I don't fault them for trying, but Big Tech is really good at complying in manners to not sacrifice their business goals.

    And regards to Apple, I am not convienced iMessage is key to customer loyalty. That may have been true 5 years ago and as documented, but now its the fact that people have Apple watches, speakers, tvs and even credit cards that only work with iOS. I think they are fighting a war on an old battlefield.

    And even then I am curious to what changes they will be forcing with iMessage. Does it have to be accessible on something besides an apple device? Or they fixated on the lack of feature parity between iMessage and SMS.

    Honestly, I wont complain if the functionality is forced to be ported to more devices. I would love to send High Quality messages from my PC and it would be great to send videos of the kids to the GrandParents in high quality knowing they decided to be deplorables that run Android (/sarcasm, I JEST!). But the moment iMessage functionality is crippled because of compliance to regulations that will disappoint me.

    • ianbetteridge

      The notion that iMessage lock in is a key to customer loyalty is hogwash. Apple customer loyalty is just as high in areas like Europe, where I,essafe isn’t even close to the dominant message platform (the only people who use it are Gen X’ers like me).

  6. Daekar

    This is going to lead to negative outcomes even though the intentions are good.

  7. derekabraham

    This is the typical 'we know everything' attitude from EU. If this was intended to be for interop and innovation, why limit it to large companies? Will the same rules apply to other industries? For example will EU tell Volkswagen that their cars should be designed to work with parts form BMW? Or ask Tesla to build batteries that can work on other cars? Messaging applications and app stores are not limiting customers - they can always choose another platform if they need another set of apps. They can use other apps if they want to talk to another. Right now I have a choice of using Whatsapp for some calls and Messenger for others. If interop means everyone can talk to anyone using any form of communication, that means they can see all available means to talk to me and can call me on any medium.

  8. lvthunder

    Say goodbye to new messaging features. It will be so difficult to add new features it won't be worth it. It will be just like land-based telephone lines. Look how long the transition to IPV6 is taking.

    • Bart

      This is nonsense. It will sput innovation. After all, platforms now have to create the best user experience. For example. Let's say disappearing messages isn't a thing yet; who ever implements this first, might draw users to its platform.

      • ianbetteridge

        Except that the extremist view of interoperability is that every client supports every feature, so as soon as you develop anything new, you need to give it away to the competition to maintain interoperability.

        Thats not going to happen of course, but that is certainly the view some are taking.

      • behindmyscreen

        sounds like the promises made by Brexitiers.

  9. melinau

    If this genuinely allows proper "interoperability" - which I define as allowing Apps\applications to work equally easily & with the same features on all appropriate platforms - Make it so....

    • dftf

      This is mostly the case right-now for apps which are cross-platform.

      Instead of using iMessage on Apple devices, and things like Chat, Messages, Hangouts and Duo on Android, people should just use cross-platform apps, like WhatsApp, Telegram, Signal, Threema, Wire, Viber and so-on. Then both sides would have near feature-parity.

      • ianbetteridge

        You should check out the amount of personal data that WhatsApp harvests vs what iMessage wants. If the price of interoperability is more data in Meta’s hands, I don’t want it.

      • wshwe

        In the US at least the tyranny of the default reigns supreme. I will keep using iMessage 100%.