Margrethe Vestager, Executive Vice President of the European Commission for Adapting to the Digital Age, held a press conference on “Apple’s App Store Rules for Music Streaming Providers” in Brussels, Belgium on April 30, 2021 meeting. Photography: Dursun Aydemir/Anadolu Agency via Getty Images)
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EU starts investigation on Monday apple, letter and Yuanthe first investigation under the sweeping new Digital Markets Act technology legislation.
“Today, the Commission initiated non-compliance under the Digital Markets Act (DMA) with respect to Alphabet’s guidance in Google Play and self-preference rules on Google Search, Apple’s guidance in the App Store, and Safari and Safari’s select screen rules. Investigation. Meta’s ‘pay or consent model’,” the European Commission said in a statement.
The first two investigations focused on Alphabet and Apple and related to so-called anti-steering rules. Under the DMA, tech companies are not allowed to prevent businesses from telling users about cheaper options for their products or subscriptions outside of app stores.
“The way Apple and Alphabet have implemented the DMA’s anti-diversion rules appears to be inconsistent with the letter of the law. Apple and Alphabet will still charge various recurring fees and will still impose restrictions on diversion,” said EU competition chief Margrethe Vestager ), said at a news conference on Monday.
Apple has violated EU regulations. This month, the European Commission said it fined the company 1.8 billion euros ($1.95 billion) after it found it had imposed restrictions on app developers that prevented them from telling iOS users about alternative and cheaper music subscription services available outside of their apps. ) fine.
In its third investigation, the committee said it was investigating whether Apple complied with its DMA obligations to ensure users can easily uninstall apps and change default settings on iOS. The investigation also focuses on whether Apple actively prompts users to make choices that allow them to change default services on iOS, such as web browsers or search engines.
The committee said it was “concerned that Apple’s measures, including the design of web browser selection screens, may prevent users from truly exercising their service choices within the Apple ecosystem.”
Apple said it believes it complies with the DMA’s regulations.
“We believe our plans are compliant with the DMA and we will continue to engage constructively with the European Commission as they conduct their investigation. The Apple team has created a series of new developer capabilities, features and tools to comply with the DMA’s requirements.” An Apple spokesperson told CNBC on Monday.
The fourth investigation is into Alphabet, where the European Commission is investigating whether the Google search results the company displays “may lead to a self-preference” relative to other Google services, such as Google Shopping, over similar rival products.
“To comply with the Digital Markets Act, we have made significant changes to how our services operate in Europe,” Alphabet director of competition Oliver Bethell said in a statement.
“Over the past year, we have engaged in dozens of campaigns with the European Commission, stakeholders and third parties to receive and respond to feedback and balance conflicting demands within the ecosystem. We will continue to defend our Methods.”
Alphabet pointed to a blog post earlier this month in which the company outlined some of the changes, including giving Android phone users the option to easily change their default search engines and browsers and making it easier for people to search on Google areas such as shopping or flights.
meta survey
The fifth and final investigation focuses on Meta and its so-called pay-and-consent model.Last year, Meta launched Ad-free subscription models for Facebook and Instagram in Europe. The commission is investigating whether offering an ad-free subscription model or having users agree to terms and conditions for free services breaches the DMA.
“The Commission is concerned that the binary choice imposed by Meta’s ‘pay or consent’ model may not provide a real alternative if users do not consent, thereby defeating the goal of preventing gatekeepers from accumulating personal data.”
EU Internal Market Commissioner Thierry Breton told a news conference that Meta should offer “free alternatives” to its “less personalized” services.
“Gatekeeper” is a label for large technology companies that need to comply with the EU DMA.
“If any gatekeepers try to circumvent or undermine the DMA’s obligations, we will continue to use all available tools,” Vestager said.
Subscriptions are a common business model across industries, Meta said.
A Meta spokesperson said: “Subscriptions as an alternative to advertising are a well-established business model in many industries, and we designed ad-free subscriptions to address multiple overlapping regulatory obligations, including the DMA. We will continue to engage constructively with the Commission Cooperation,” he told CNBC on Monday.
Tech giants risk fines
The commission has said it intends to complete its investigation within 12 months, but Vestager and Breton stressed at a press conference on Monday that the DMA did not set a hard deadline for the investigation’s timetable. The regulator will inform the company of its preliminary findings and explain the steps they are taking, or steps the regulator should take, to address the Commission’s concerns.
If any company is found to be in breach of the DMA, the Commission can impose fines of up to 10% of the technology company’s total global turnover. For repeated violations, the penalty may increase to 20%.
The committee said it was also seeking facts and information to clarify whether Amazon Amazon may prefer private-label products on its e-commerce platform to its competitors. The committee is further studying Apple’s new fee structure and other terms and conditions for alternative App Stores.
This month, the tech giant announced that EU users will be able to download apps from the website rather than through its proprietary App Store – a change that Apple has resisted for years.
The EU study of Apple and Amazon does not include official investigations.