Brussels opens proceedings
Google, Apple and Meta face billions in fines in the EU
March 25, 2024, 12:00 p.m
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A new law is intended to limit the market power of large tech companies. However, the EU Commission is of the opinion that Google, Apple and Meta are not adhering to the requirements enough – despite help from Brussels. There are now severe penalties.
The EU Commission has opened competition proceedings against Google parent Alphabet, iPhone manufacturer Apple and Facebook parent company Meta. According to suspicions from Brussels, companies are not doing enough to adhere to the requirements of the new law for digital markets, as the Commission announced. With the law, the EU wants to limit the market power of digital companies; if they violate it, they face fines running into the billions.
Since the law came into force at the beginning of March, companies have already announced changes, emphasized EU Digital Commissioner Thierry Breton. “However, we are not convinced that the solutions proposed by Alphabet, Apple and Meta meet their commitments,” he explained. The Commission has been in discussions with companies “for months” to help them adapt to the new rules.
The competition watchdogs are investigating, among other things, whether Alphabet is giving its own services such as Google Maps or Google Shopping an unfair competitive advantage in the Google search engine results list. In the case of Apple, the Commission raised concerns because iPhone users are sometimes unable to delete pre-installed apps and some default settings on their cell phones cannot be changed.
Alphabet and Apple are also accused of indirectly forcing app developers to use their in-house app stores. On cell phones with the Alphabet operating system Android this is the Google Play Store; on iPhones, Apple’s App Store is preinstalled. According to the allegations, the companies prevent other providers from providing information about prices or concluding contracts without using the respective app store.
Investigations into the meta payment model
The investigation into the Meta Group is about a much-criticized payment model for the Facebook and Instagram platforms: users can pay a monthly fee of at least 9.99 euros if they no longer want to see advertising. Only those who accept personalized ads can continue to use the platforms for free. The EU Commission suspects that users are indirectly forced to pass on their data.
With the Digital Markets Act (DMA), the EU wants to limit the market power of so-called gatekeepers of the Internet. The stricter rules have been in effect since the beginning of March for Google parent Alphabet, Amazon, Apple, Tiktok parent Bytedance, Meta and Microsoft. If the commission finds violations of the new law in its investigations, the companies face penalties of up to ten percent of their global annual turnover.