Big Tech to Face Increased EU Scrutiny as DMA Takes Effect

Next week, the EU’s Digital Markets Act takes effect, and U.S. tech giants are preparing for headaches. Among the DMA’s goals is making companies like Amazon, Google and Meta Platforms more open and interoperable in 2023. Last month, veteran EU official Gerard de Graaf, who helped create the DMA, was installed as director of a satellite office in San Francisco. There, he will help Big Tech prepare for breaking out their wallets and breaking open their walled gardens as the result of  “significant” changes to how they’ve been doing business in Europe. Meanwhile, telecoms in Europe are looking for tech firms to pay new fees based on bandwidth issues.

“If you have an iPhone, you should be able to download apps not just from the App Store but from other app stores or from the Internet,” de Graaf told Wired in an interview at San Francisco’s Irish consulate, where the new EU office is currently located.

Among its directives, the DMA attempts to level the playing field for competitors trying to get a market foothold. It “could also compel Meta’s WhatsApp to receive messages from competing apps like Signal or Telegram, or prevent Amazon, Apple, and Google from preferencing their own apps and services,” Wired writes.

Compliance will phase in, with the EU first identifying the companies to be categorized “gatekeepers,” thus subject to the DMA’s toughest rules. De Graaf told Wired about a dozen companies will initially fall into that group, with a list expected to be announced in the first half of 2003. At that point, the targeted companies will get six months to comply with the new regulations.

De Graaf said he expects a wave of new lawsuits challenging the DMA but says his California sojourn is designed in part to ameliorate that. “The key message is that negotiations are over, we’re in a compliance situation,” de Graaf told Wired. “Like the EU’s General Data Protection Regulation digital privacy law, the DMA is expected to have ramifications worldwide, changing how Big Tech deals with customers well beyond the EU’s 400 million Internet households.

On a related note, CNBC is reporting that EU telecom firms are seeking proportional payment from companies including Google, Netflix and Amazon for “the outsized portion of bandwidth they take up on their networks.”

The idea seems to be gathering steam among EU regulators in various countries, some of whom have publicly expressed support with talk of new fees and taxes. “Their logic is that certain platforms, like Amazon Prime and Netflix, chew through gargantuan amounts of data and should therefore foot part of the bill for adding new capacity to cope with the increased strain,” CNBC writes.

Google Case Before High Court Could Reshape Internet Economy, The Wall Street Journal, 10/30/22
India Sets Up Panel with Veto Power Over Social Media Content Moderation, TechCrunch, 10/28/22
New EU Law Could Force Apple to Allow Other App Stores, Sideloading, and iMessage Interoperability, MacRumors, 11/1/22

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