On Wednesday, the European Union intensified its regulatory crackdown on technology behemoths by issuing two landmark charges against Google and compelling Apple to enhance connectivity with its devices for competitors.
Targeted under the provisions of the Digital Markets Act (DMA), both tech giants have come under scrutiny for their alleged monopolistic practices. The DMA, a legislative measure designed to curb the dominance of major tech players, provides a stringent set of guidelines that these firms must adhere to.
The European Commission, revealing its preliminary conclusions, accused Google of two primary violations. The inquiries focused on the tech giant’s restrictions on app developers’ ability to present alternative offers outside the Google Play Store and whether Google unfairly favored its own products and services such as Google Flights and Google Search.
Alphabet Inc., Google’s parent company, allegedly imposes unjustifiable service fees on app developers, inhibiting them from directing consumers to alternative digital purchase options, according to findings. Moreover, Google is said to be promoting its own services at the expense of equally compelling rival offers, impacting overall market competition.
EU Competition Commissioner Teresa Ribera articulated that the regulatory steps are crafted to ensure compliance with EU statutes, especially concerning services with significant user interaction like Google Search and Android devices.
In a parallel regulatory measure, Apple received directives to unlock its ecosystem, obliging the company to provide fair access to its proprietary technology for rival smartphone and accessory manufacturers. The orders stipulate a timeline for Apple to harmonize its systems with third-party developers’ systems.
Both Google and Apple contested the EU’s actions.
Google’s senior director for competition, Oliver Bethell, claimed the commission’s determinations could obstruct consumer access and diminish European business performance.
Apple, on the other hand, argued that the EU’s mandates would hamper their innovation dynamics and unfairly advantage competitors.
In the broader context of EU actionable measures, Google faces potential penalties up to 10% of its global annual sales if it’s deemed non-compliant with the DMA. Apple, similarly, could endure further investigations and sanctions if it disregards these orders.
This aggressive stance by the European Commission comes despite prior warnings from US President Donald Trump about potential tariffs in response to EU fines on American firms.
