Google, Apple and Meta under EU investigation

The European Union has launched an investigation into non-competitive behavior by three of the world’s largest companies.

Meta, Apple and Alphabet (Google’s parent company) are being assessed for possible breaches of the Digital Markets Act (DMA) introduced in 2022.

If convicted, the three companies could face hefty fines of up to 10% of annual turnover – hundreds of billions of dollars for each company.

On Monday (March 25), EU antitrust chief Margrethe Vestager and industry chief Thierry Breton announced the investigation.

We open on the 1st today #investigation under #DMA.

we worry #letter, @apple & @Yuan Failure to meet its obligations, for example:

👉#apple & #letter Recurring fees still apply #app #Developer
👉#Yuan No real choice for users to opt out #data combination

⬇️

—Margrethe Vestager (@vestager) March 25, 2024

The DMA only contains obligations for six companies, which happen to be the largest tech companies in the world: Alphabet, Apple, Meta, Amazon, ByteDance, Microsoft. However, none of these companies are based in the EU – ByteDance is headquartered in Beijing and the rest are based in the United States.

Apple, Meta and Google are now facing questions about their compliance reporting. The report submitted two weeks ago has been thoroughly analyzed.

The news would be another blow to Apple after it was fined 1.8 billion euros three weeks ago for violating music streaming competition laws. In addition, the United States has accused Apple of monopolizing the smartphone industry and last week filed a landmark lawsuit against the technology company.

A company spokesman said the company would cooperate with the investigation and had no doubt that its plans complied with the Digital Markets Act.

They made it clear that their team has created various mechanisms to ensure compliance with the EU’s landmark legislation, as well as privacy and security protections for EU users.

“Throughout, we have demonstrated flexibility and responsiveness to the European Commission and developers, listening to and incorporating their feedback,” Apple said.

On the other hand, a Meta spokesperson said the company’s use of subscriptions as an alternative to advertising is a “proven business model across many industries.”

They said: “We designed the ad-free subscription to address multiple overlapping regulatory obligations, including the DMA… We will continue to engage constructively with the Commission.”

Why are Google, Meta and Facebook under investigation?

The EU will investigate five different possible breaches:

• 1 & 2 – Do Apple and Google not allow apps to openly communicate with users and enter into contracts with them?
• 3 – Is Apple not providing enough choice to its users?
• 4 – Does Meta unethically require users to pay to avoid having their data used for advertising?
• 5 – Does Google prefer to display its own company’s products and services in search results?

The first two of the investigations were dubbed “counter-bootstraps” – and the EU said it believed the company’s investigations complicated the way apps tell users about cheaper ways to pay for services.

The third point involves the EU saying Apple is obliged to allow users to simply uninstall apps, change default settings and provide a “choice screen” to allow them to use a different browser. What’s more, the EU believes Apple’s current web browser selection screen doesn’t give people enough choice.

The investigation will take approximately 12 months to complete.

Featured image: Flickr