Apple, Meta, Microsoft, Amazon, More Tech Giants To Face Biz Overhaul In Europe: Here's Why

As gatekeepers, these businesses are mandated to facilitate interoperability between their messaging applications and rival services.

The DMA casts a wide net, with Google, a subsidiary of Alphabet, facing the most significant impact. ( Image Source :Getty )

The European Commission has taken decisive action against major players in the tech industry, designating 22 services offered by six prominent tech giants as "gatekeepers" within the realm of online services, spanning from messaging platforms to video sharing. This move represents the EU's latest effort to rein in the influence and practices of Big Tech corporations. The entities in question are Alphabet, Amazon, Apple, Meta, Microsoft, and ByteDance, the parent company of TikTok, as reported by Reuters.

This designation stems from a comprehensive set of guidelines outlined in the European Union's Digital Markets Act (DMA), a regulatory framework that came into effect in November. Under the DMA's provisions, companies boasting more than 45 million monthly active users and a market capitalisation exceeding 75 billion euros (approximately $82 billion) are identified as gatekeepers within the core platform service sector.

As gatekeepers, these businesses are mandated to facilitate interoperability between their messaging applications and rival services. Moreover, users will have the authority to choose which applications come pre-installed on their devices.

The DMA casts a wide net, with Google, a subsidiary of Alphabet, facing the most significant impact. Google will now need to adhere to more stringent rules for several of its services, including the Android operating system, Maps, and Search. Meta, the parent company of Facebook, Instagram, Marketplace, and WhatsApp, also falls within the ambit of gatekeepers.

Thierry Breton, the EU's industry chief, emphasised, "While gatekeepers have six months to demonstrate their compliance with their obligations, they must immediately appoint a compliance officer in place, directly reporting to the Board, and inform the Commission of any planned merger or acquisition." The DMA violations could result in fines of up to 10% of a company's annual global turnover.

However, there are exceptions. Alphabet's Gmail, Microsoft's Outlook, and Samsung's browser have been exempted from these regulations, following arguments put forth by these companies, which convinced the Commission that these particular services do not meet the criteria for gatekeeper status.

Oliver Bethell, Director of Legal at Google, remarked, "Over the last few months, we have been working to meet the new requirements of the Digital Markets Act, and we will now review today's designation decision in full."

Furthermore, the Commission has initiated four separate market investigations to further scrutinise Microsoft's and Apple's assertions that some of their core platforms, such as Bing, Edge, Microsoft Advertising, and Apple's iMessage services, do not fall under the gatekeeper category as defined by the DMA.