The Digital Markets Act: The EU’s Tool to Open Big Tech

March 7 is the first day for Alphabet, Amazon, Apple, ByteDance, Meta, and Microsoft—the first six gatekeepers designated by the European Commission for their platform services—to fully comply with the EU’s Digital Markets Act (DMA). Since May 2023, the DMA has been aiming to ensure fair and open markets in the digital sector. It requires gatekeepers to (1) allow third parties to inter-operate with the gatekeeper’s own services, (2) grant business users access to the data they generate while using the gatekeeper’s platform, (3) provide tools and information necessary for advertisers and publishers to carry out their own independent verification, and (4) permit business users to promote their offers and conclude contracts outside the gatekeeper’s platform. If a gatekeeper fails to comply, they will face initial fines of up to 10% of the company’s total worldwide turnover. The fines increase to 20% for repeated infringement.

As of March 7, all six gatekeepers have released DMA compliance measures. For example, Google implemented updates affecting Google Chrome and the Google Play store that aimed to simplify the third-party app download process. This allows users to use alternative app stores and billing options outside Google Play. Apple modified App Store, Safari, iOS, and Apple Pay to enable third-party applications to interact with the Apple systems. Whereas TikTok (owned by ByteDance) challenged its gatekeeper designation in Europe’s second top court—the Luxembourg-based General Court—it still complied with the DMA requirements as the Court refused to suspend its obligation to comply. Consequently, TikTok released its compliance measures on March 3: it enhanced its “download data” feature for both users and developers and granted additional data access to business accounts.

The DMA is considered a tool to break the dominance of Big Tech in the EU. However, it has faced criticism such as claims that it protects competitors rather than consumers, overregulates, and decreases economic efficiency. In fact, the EU acknowledges that the DMA will increase the time costs for consumers to choose digital services. Conversely, supporters argue that the DMA helps to build a more competitive environment for businesses by regulating the self-preferencing of big tech companies and bringing fairness to the mobile app ecosystem. Additionally, consumers can benefit from a wider range of choices. Regardless of the evaluation, the DMA has opened the closed market created by big tech companies, which have for years leveraged their market dominance to exclude competition by self-preferencing and building closed ecosystems. Under the DMA, tech companies are obligated to open up their ecosystems, facilitate data flow between platforms, and treat search results equally. For small companies, the opportunities outweigh the challenges, while for gatekeepers, DMA compliance will become an essential part of future corporate compliance.