Meta, Google, Apple face EU probes over new tech regulations
The European Union launched investigations into Meta, Google and Apple to review if the three U.S.-based tech giants’ recently announced measures comply with the EU’s new tech regulations, the European Commission announced Monday.
The investigations will focus on whether the companies’ new policies regarding app store rules, display of options to users and subscription offerings comply with the Digital Markets Act (DMA), an EU law that went into effect earlier this month that regulates large tech companies designated as “gatekeepers.”
The DMA named six gatekeepers, which also included TikTok, Microsoft and Amazon, defined by their annual turnover and number of monthly active users. The investigations, which can take up to 12 months, could lead to fines of up to 10 percent of their total worldwide annual turnover if they are found to have violated the law, or up to 20 percent in case of repeated infringement.
The investigation into Apple and Google’s parent company Alphabet centers in part on how the companies have put measures in place to reduce so-called steering rules in their app stores, or rules that can limit app developers from showing offers to users outside of the app stores.
The commission said the measures put in place by the companies “may not be fully compliant as they impose various restrictions and limitations,” such as limiting developers from freely communicating to promote offers.
Google is also facing a probe over whether its display of Google search results may lead to self-preferencing its own services, such as Google Flights or Google Shopping, over similar rival services.
The commission said Google’s measures to prevent self-preferencing may not ensure third-party services in Google search results are “treated in a fair and non-discriminatory manner in comparison with Alphabet’s own services.”
Google director of competition Oliver Bethell said in in a statement the company has made “significant changes to the way our services operate in Europe.”
“We have engaged with the European Commission, stakeholders and third parties in dozens of events over the past year to receive and respond to feedback, and to balance conflicting needs within the ecosystem. We will continue to defend our approach in the coming months,” Bethell added.
Apple is also facing a probe over how it complies with user choice obligations, which require the company to allow users to easily uninstall software applications on iOS, easily change default settings and prompt users with choice screens to select alternative default services.
The commission said it is concerned Apple’s measures to prevent self-preferencing, such as the layout of the web browser choice screen, may be preventing users from “truly exercising their choice of services within the Apple ecosystem.”
An Apple spokesperson said the company is “confident our plan complies with the DMA, and we’ll continue to constructively engage with the European Commission as they conduct their investigations.”
“Teams across Apple have created a wide range of new developer capabilities, features, and tools to comply with the regulation. At the same time, we’ve introduced protections to help reduce new risks to the privacy, quality, and security of our EU users’ experience. Throughout, we’ve demonstrated flexibility and responsiveness to the European Commission and developers, listening and incorporating their feedback,” the spokesperson added.
Meta, Facebook’s parent company, is facing a probe over a new, optional subscription-based model that limits targeted ads as a way to comply with the DMA’s requirement for gatekeepers to obtain consent from users when they intend to use their personal data across different core platform services.
“The Commission is concerned that the binary choice imposed by Meta’s ‘pay or consent’ model may not provide a real alternative in case users do not consent, thereby not achieving the objective of preventing the accumulation of personal data by gatekeepers,” the commission said in the announcement.
A Meta spokesperson said that “subscriptions as an alternative to advertising are a well-established business model across many industries,” and that Meta designed the system to address “several overlapping regulatory obligations, including the DMA.”
“We will continue to engage constructively with the Commission,” the spokesperson added.
In addition to the noncompliance investigations launched Monday, the European Commission said it launched “investigatory steps” related to Apple’s new fee structure for alternative app stores and distribution of apps from the web, also known as sideloading.
The commission is also taking investigatory steps to gather facts to clarify whether Amazon, another listed gatekeeper, is self-preferencing its own brand products on the Amazon store in violation of the DMA.
An Amazon spokesperson said the company is compliant with the DMA and “has engaged constructively with the European Commission on our plans since the designation of two of our services.”
“We continue to work hard every day to meet all of our customers’ high standards within Europe’s changing regulatory environment,” the spokesperson added.
Updated at 2:17 p.m. EDT.
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