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Navigating the New Regulations: Apple and Microsoft Adapt to the EU's Digital Markets Act

Andrew Singleton 15 Feb 2024

In the dynamic landscape of digital regulation, the European Union has been at the forefront in crafting strict new rules that seek to curb the overwhelming influence of Big Tech companies. Known as the Digital Markets Act (DMA), these regulations aim to level the playing field by targeting firms classified as "gatekeepers" due to their substantial market power and control over multiple platforms. Recently, the E.U. Commission revealed outcomes that entail significant implications for industry giants, notably Apple Inc. and Microsoft Corp., and their various services.

The probe carried out by E.U. regulators as part of implementing the DMA guidelines has brought about a noteworthy development in the tech industry. Despite the widespread assumption that all services by Big Tech would automatically fall under the umbrella of the DMA's stringent requirements, a different picture has emerged following the Commission's assessment. Apple's renowned iMessage platform and Microsoft’s suite of Bing search engine, Edge web browser, and Advertising service have found themselves on the advantageous side of the delineation, as they have been deemed not to hold dominant enough market positions to warrant the "gatekeeper" label.

This evaluation by the EU indicates a more nuanced approach to dealing with digital platforms, taking into account their actual market footprint rather than painting all with the same broad regulatory brush. While this means that particular services from Apple and Microsoft will not be subject to the most invasive measures of the DMA, it does not grant these companies absolute freedom. Other segments of their vast ecosystems, such as Microsoft's Windows and LinkedIn and Apple's iOS, App Store, and Safari, continue to fall within the scope of the rules.

Perhaps most revolutionary is the enforced impartiality and promotion of competition that the DMA insists upon, prohibiting self-preferencing and monopolistic practices prominently observed in the digital market. Additionally, new stipulations demand increased interoperability and data protection, fundamentally altering how tech companies operate across their various services, including how they collect and use personal data.

The EU’s decision marks a watershed moment in the ongoing dialogue around the regulation of Big Tech. It offers a respite for Apple and Microsoft concerning some of their services from the direct impact of the DMA, while still ensuring broad-scale operational changes to their key products. As the rules are poised to take effect, Big Tech firms must navigate the complex waters of compliance, which extends far beyond the functionalities of a single service to the core of how they must conduct their business in the EU. This leads to the intended outcome: a more competitive, fair, and consumer-centric digital marketplace.