The EU’s Digital Market Act takes aim at Big Tech’s monopoly

Big Tech is going to be regulated by the EU in a huge blow.

The Digital Markets Act was adopted by the European Council.

The act aims to establish a level digital playing field by setting clear rights and rules for large online platforms which will make it harder for them to abuse their position.

Do you like gadgets? Is that also an app? There are other cool tech things. This newsletter is for you.

Ivan Barto is the Minister of Regional Development and the deputy prime minister for digitisation.

Thanks to the DMA, we will ensure fair competition online, more convenience for consumers and new opportunities for small businesses.

The gatekeepers that the DMA addresses are omnipresent — we all use their services on a daily basis. However, their power is growing to an extent that negatively affects competition.

Online search engines, app stores, and social media platforms are covered in the gatekeeper category. Messages, operating systems, advertising, e-commerce, and cloud services are all targets.

It must have annual revenue of at least 7.5 billion in the EU over the past three years or have a market valuation of at least 75 billion. At least 45 million monthly users and 10,000 business users are required.

A guide to the landmark decision

Gatekeepers are required to make sure the following is done.

• They must inform the European Commission of their acquisitions and mergers.
• Unsubscribing from core platform services must be just as easy as subscribing.
• The basic functionalities of instant messaging services must be interoperable, meaning that users should be able to exchange messages and send voice messages or files across messaging apps.
• Business users must have access to their marketing or advertising performance data on the platform.

The prohibitions are more aggressive. Gatekeepers can't anymore.

• Rank their own products or services higher than those of others.
• Pre-install certain apps or software, or prevent users from easily un-installing these apps or software.
• Require the most important software (e.g. web browsers) to be installed by default when installing an operating system.
• Prevent developers from using third-party payment platforms for app sales.
• Reuse private data collected during a service for the purposes of another service.

If they don't comply with the rules within six months, they will be fined up to 10% of their turnover.

The European Commission can open a market investigation if they violate the rules at least three times in eight years.

Google, Apple, Meta, and Amazon are hit hardest

Many core business practices are banned by the new rules.

Do you think about it?

Apple has resisted allowing alternatives for downloads and third-party payments in the App Store due to the fact that it would cost it a 30% commission fee.

Users will no longer be able to consent to the collection of data from the services they use.

Many of the default apps provided by Apple and Google will have to go.

Amazon will no longer be able to use data collected from outside sellers on its services to offer competing products of its own.

Big Tech will definitely spend a lot of money on the DMA. They have been monopolizing the market for too long, stripping their users of choice and decreasing business opportunities for smaller companies.

It is hoped that the EU's legislation will mark the beginning of a fair digital space.