Microsoft and Apple are reportedly lobbying to exclude Bing and iMessage from a list of “gatekeepers” that will be subject to new European Digital Markets Act regulations, according to Financial Times. The European Commission is expected to unveil a list of designated gatekeepers on September 6th, which will identify companies and specific services they provide that must adhere to interoperability and competition rules.
Criteria for ‘Gatekeeper' Designation
A new regulation by the EU, the DMA, aims to transform the digital sector by regulating big tech platforms that are considered “gatekeepers”. These are platforms that have a large influence on the EU's internal market and act as intermediaries for millions of users and businesses.
The DMA, which has been effective since May, sets out a number of rules for gatekeepers, such as not giving preference to their own services, letting users remove pre-installed apps, and sharing data with competitors. The DMA also gives the European Commission the authority to fine gatekeepers up to 10% of their annual revenue, or even split or ban them if they keep breaking the rules.
The Digital Markets Act (DMA) defines gatekeepers based on their revenue, user numbers, and other criteria. Services that fall under the ‘gatekeeper' label must have over 45 million monthly active users in the EU and either a turnover exceeding 7.5 billion euros annually or a market cap surpassing 75 billion euros.
In July, seven major tech companies acknowledged their position as being big enough to be gatekeepers: seven companies have officially acknowledged they meet the criteria: Alphabet (Google), Amazon, Apple, ByteDance (TikTok), Meta (Facebook, Instagram, Whatsapp), Microsoft, and Samsung. However, it now seems that Apple and Microsoft are challenging aspects of the DMA, believing certain services should be excluded.
Microsoft's Stance on Bing
Microsoft is contending that while its Windows platform might fit the ‘gatekeeper' criteria, Bing does not. The company argues that Bing's market share in search is considerably smaller compared to its main competitor, Google. Microsoft believes that Bing's position could be further weakened if it's mandated to provide users with access to competing search engines.
Apple's Argument on iMessage
Apple is reportedly exploring ways to allow third-party app stores and sideloading on iOS in anticipation of the DMA rules. However, the tech giant is arguing that iMessage does not meet the DMA's user threshold of 45 million active monthly users in the EU. While Apple has not released official figures, external estimates suggest iMessage could have up to a billion users globally. 9to5Mac highlighted that competitors like WhatsApp have a stronger presence in Europe compared to iMessage.
Obligations of Gatekeepers Under the DMA
- Providing interoperability between their platforms. This means that users should be able to easily move their data and content from one platform to another.
- Allowing third-party app stores and payment systems on their devices. This will give users more choice and control over how they interact with their devices.
- Not self-preferencing their own products and services. This means that gatekeepers should not give their own products and services an unfair advantage over those of their competitors.
- Disclosing more information about their algorithms. This will help users to understand how their data is being used and to make more informed choices about how they interact with the platforms.
Companies identified as gatekeepers will have six months, or until March 2024, to align with the DMA's regulations. If they fail to comply, they might face stringent interoperability rules.