The European Union started investigating the alleged antitrust practices by US tech giants. These are the companies under the spotlight.
On Monday, the European Union launched several probes aimed at US big tech firms, the bloc’s antitrust watchdog said. The investigations fall under the new Digital Market Act (DMA), an EU legislation protecting digital consumer’s privacy and wallets.
The main companies these investigations target are Apple, Alphabet (Google), Meta (Facebook, Instagram), and Amazon. Together, their market capitalization reaches $7,66 trillion, which would rank 3rd as the world’s largest GDP if it were a sovereign country’s economy.
The European Union increased its regulatory efforts against big tech. This month, the Commission hit Apple with a $500 million fine, charging the company with anti-competitive practices.
The new investigation on Apple will focus on its so-called “steering” marketing methods. In short, the Commission is worried Apple hides cheaper options on its marketplaces, prompting users to select their proprietary, more expensive products instead.
This follows a separate US government investigation into Apple’s alleged antitrust violations. The Department of Justice hit the Cupertino company with a lawsuit against its ecosystem, accusing Apple of monopolizing the smartphone sector in the US market.
Both investigations will take years to clear and will significantly distract Apple from its day-to-day operations. Chief executives will have to spend hours in legal meetings with lawyers and will be forced to hand over confidential documents to both the US and EU governments.
Alphabet and Meta under the spotlight
Apple was not the only tech giant hit by EU regulations. Monday’s announcement also mentioned anti-steering probes against Alphabet, Google’s parent company, too.
Again, the EU accuses Alphabet of hiding alternative products from consumers. On the Google Search Engine, all other visible services are only those offered by Alphabet.
Regarding Meta, the investigation will focus on the data collection from its users across the bloc. Meta already introduced a no-ads paid subscription service in the EU last November, but Brussels officials worry it may not be enough.
Industry chief Thierry Breton said Meta should find a free alternative to data collection. He said the subscription option is simply a placeholder to keep collecting data as usual.
All tech giants hit by the investigation commented saying they already follow DMA’s protocol. They are open to cooperation with the European Union and ready to change practices when needed.
Failing to do so could result in hefty fines by the European Commission. A proven violation of the DMA could entail a fine equal to 10% of the company’s global annual turnover. Reiterated violations could raise the percentage to 20%.
