Brussels European antitrust investigators announced Monday that Apple, Alphabet's Google, and Meta Platforms will be probed for possible violations of the EU's new Digital Markets Act, which may result in large fines.
The EU rule, effective March 7, aims to confront tech giants by making it easier to switch between competing online services including social media, browsers, and app stores. That should allow smaller firms to compete.
Companies could be fined 10% of their global turnover for violations. US antitrust regulators are also cracking down on Big Tech for alleged anti-competitive tactics, which might break up the company. Tech giants say they have hundreds of engineers to meet a Digital Markets Act requirement that six "gatekeepers"—search engines and chat apps used by other businesses—give users and competitors additional options.
As reported , the European Commission said Monday it feared the safeguards were ineffective under the DMA. On whether the Commission was hurrying the process two weeks after the legislation took effect, EU industry director Thierry Breton said the inquiries should not be surprising.
The issue is whether Apple allows iPhone users to quickly uninstall software applications, modify default settings, or access choice panels to switch to a competing browser or search engine. Regulators also worry about "steering": if Apple restricts software developers from telling customers about free deals outside the software Store.
Apple said it was certain its plan conformed with the DMA since it was responsive to the Commission and developers and incorporated their views. Regulators claim Alphabet faces anti-steering issues. The probe will explore whether it favors its vertical search engines like Google Shopping, Google Flights, and Google Hotels over competitors and discriminates against third-party services on Google search results.
The Commission also criticized Apple and Alphabet's fees for violating the DMA's "free of charge" rule. Both businesses raised certain service rates recently. Breton said Meta, which launched a no-ads subscription service in Europe last November and was criticized by rivals and users, should offer free alternatives. Meta's representative stated the company was following the act.
Subscriptions as an alternative to advertising are a well-established business model across many industries, and we designed Subscription for No Ads to address several overlapping regulatory obligations, including the DMA," the rep added. Google claimed it has made major service adjustments and will defend its approach in the coming months.
The Commission is also investigating Apple's new alternative app store fee structure and Amazon's marketplace ranking. Along with Microsoft and ByteDance, Amazon is a DMA "gatekeeper".
Amazon is compliant with the Digital Markets Act and has engaged constructively with the European Commission on our plans since the designation of two of our services," a spokeswoman said. "We continue to work hard every day to meet all of our customers' high standards within Europe's changing regulatory environment."
The EU executive has required corporations to retain some papers to access important information for its current and future investigations, which are scheduled to conclude in a year under the DMA. App developers and corporate users were increasingly critical of the corporations' compliance efforts, prompting EU inspections
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