Apple and Microsoft Contest EU Designation of Lesser-Used Services Under New Regulations

Apple and Microsoft are challenging the European Union's (EU) new legislation aimed at regulating the power of Big Tech, arguing that certain services are not widely popular enough to be categorized as "gatekeepers." The Digital Markets Act (DMA), set to be published this week, introduces fresh responsibilities for tech companies, including data sharing, linking to competitors, and ensuring interoperability with rival apps.

According to the legislation, platforms with an annual turnover exceeding €7.5 billion, a market capitalization over €75 billion, and at least 45 million active monthly users in the EU will be subject to the new rules. However, Brussels retains some flexibility in designating companies as gatekeepers.

Microsoft has rejected the notion of subjecting Bing to the same obligations as Google Search, citing Bing's modest market share of just 3 percent. Microsoft is concerned that additional legal scrutiny could place Bing at a disadvantage and inadvertently boost Google's market share.

Apple contends that its iMessage app does not meet the user number threshold for regulation. While industry analysts estimate iMessage has approximately 1 billion users worldwide, Apple has refrained from disclosing specific figures for several years. The outcome may hinge on how Apple and the EU define the market segment in which iMessage operates.

Both Apple and Microsoft, along with the European Commission, have refrained from offering comments on the matter. According to insiders, all major US tech companies, including Amazon, Google, and Meta, will see several of their services regulated under the DMA.

The EU is still deliberating the inclusion of iMessage and Bing in the final list of services. The European Commission may initiate a probe to determine whether these services should be subject to the new obligations outlined in the legislation.

The DMA is part of a broader process aimed at implementing new rules set to take full effect next spring. The European Commission anticipates legal challenges in EU courts in Luxembourg regarding its decisions.

Andreas Schwab, the MEP who led the negotiation of the rules, commented, "The DMA will bring new competition to digital markets in Europe, and now it is up to the commission to make it work."

This challenge by tech giants coincides with heightened scrutiny of their alleged anti-competitive practices in the EU. Earlier this year, Brussels issued a threat to break up Google over alleged illegal practices in the adtech sector.

By fLEXI tEAM