Tracking Big Tech’s Responses to the EU’s DMA Gatekeeper Requirements

Under the EU’s Digital Market Act (DMA), which is intended to increase competition in the digital economy, Big Tech innovations — coming from both the U.S. and abroad — are finding themselves reshaped as companies scramble to comply with the new set of regulations which went live earlier this month (March 7).

European Union antitrust chief Margrethe Vestager has warned both Meta and Apple about their product pricing structures, per a Tuesday (March 19) report.

In response, social media giant Meta has offered to almost halve its monthly subscription fee for Facebook and Instagram in order to address concerns from European privacy and antitrust regulators.

The proposed change is to Meta’s fee model supporting its no-ads subscription service in Europe and would see the price drop from 9.99 euros to 5.99 euros for a single account, and down to 4 euros from 6 euros to any additional accounts after.

Per the report, Meta lawyer Tim Lamb referred to the change as “by far the lowest end of the range that any reasonable person should be paying for services of these quality,” and called it a “serious offer.”

Critics have pushed back against Meta’s move on the grounds that a “pay or OK” approach is inherently at odds with EU legislation requiring consent to data usage being “freely given.”

Apple, which prior to Vestager’s remarks has repeatedly insisted that it is in compliance with the DMA, is under scrutiny for, among other things, its core technology fee of 50 euro cents per user account, per year, that major app developers have to pay.

Neither Meta nor Apple have immediately replied to PYMNTS’ request for comment.

But they are far from the only large technology companies under fire. The DMA also places new restrictions on Amazon, ByteDance, Google, and Microsoft. Companies risk fines of as much as 10% of their annual global turnover for breaches of the regulation.

Read more: EU Competition Chief Margrethe Vestager Says DMA’s Priority is App Stores

A Roundup of Big Tech’s DMA Responses To Date

In order to comply with the EU’s regulations, the previously mentioned six Big Tech companies designated as “Gatekeepers” are rethinking both the user experience and the business models of their platforms. The gatekeeper designation applies to companies that have more than 45 million monthly active users and $81 billion in market capitalization and requires them to meet strict policies intended to reduce anticompetitive behavior.

Specific changes that have already occurred include Meta making its WhatsApp messaging service interoperable with other messaging services and Google enabling users within the EU’s 27-nation bloc decide which services share their personal data.

Per Google’s blog post, when the company’s Search, YouTube, and Chrome platforms are not linked services, recommendations in Search, like “What to watch” and your Discover feed will be less personalized.

Other changes include Apple allowing third-party app stores on iOS. The changes include more than 600 new APIs, expanded app analytics, functionality for alternative browser engines, and options for processing app payments and distributing iOS apps.

“The changes we’re announcing today comply with the Digital Markets Act’s requirements in the European Union, while helping to protect EU users from the unavoidable increased privacy and security threats this regulation brings. Our priority remains creating the best, most secure possible experience for our users in the EU and around the world,” said Phil Schiller, Apple fellow, in a company statement.

Apple, more so than most gatekeepers, has been under near-continuous fire for its response to DMA requirements given its closed ecosystem and marketplace dominance.

See also: Epic Games Slams Apple’s ‘Useless’ Payment Mechanisms

Increasing Competition in the Connected Digital Economy

Meanwhile, PYMNTS spoke with Mark Beresford, who heads the Retailer Payments Practice for London’s Edgar Dunn & Company, about the DMA’s impact on the retail space, in an interview this month.

He said that the DMA opens the market up for more retail payment methods and will foster their interoperability. He anticipates changes that include face-to-face contactless payments and transactions from a third-party banking or wallet app.

“Consumers will be able to pay via a contactless payment without a MasterCard, Visa or Amex card stored in their mobile wallet,” Beresford said. “Using a smartphone contactless payment, the transaction could be completed using PayPal, Open Banking, TikTok, WeChat Pay, or any other alternative payment method. Retailers will be in a strong position to accept faster, more secure and more cost-effective alternatives to the international card networks.”