Designation Day: Digital Markets Act
Firstly, let’s put the DMA in perspective. In Europe there are more than 10 000 active online platforms. Google has a global market share of 90% and 28.5% of its users never leave the first page of the search results. This symbolizes the power of the big tech companies and despite only being a handful, they together control and constitute the backbone of the internet.
Which companies are given obligations in the DMA?
As said in the beginning, these companies are called “Gatekeepers” and they are providers of a “Core Platform Service” (search engines, social networking services, marketplaces, operating systems, video sharing platforms etc). The courts in EU have found on various occasions that the large platform companies have restricted competition by various means. Therefore, the aim of DMA is to regulate the large platform companies so that the consumer choise and fairness of services would improve as the competition increases.
To be considered as a Gatekeeper the service provider needs to fulfil a set of requirements1. In practice, this means only the very largest tech companies providing the so-called Core Platform Services will be designated as Gatekeepers. In Europe, the estimation is that there are only approximately 10 to 20 Gatekeepers. Companies like Google, Facebook and Apple will most probably be among the designated ones.
What are the Gatekeepers’ obligations and how can your business (hopefully) benefit from them?
Do you want real-time and continuous access to high-quality data from the Gatekeepers’ platforms about your sales, customers and other commercial activity? The Gatekeepers will need to provide this.
Do you want to download all your data and utilize them by offering services via a competitor of a gatekeeper/your own platform? Gatekeepers will need to enable this by making the data portable and accessible in real-time to its competitors.
Are you a creator of an app store? The Gatekeepers will need to make competitors app stores installable on Android, iOS etcetera.
Are you a competitor to one of the gatekeepers' platforms? The Gatekeepers will need to allow end-users to easily unsubscribe from their service or uninstall their pre-installed platform services.
Are you a developer of software applications? Gatekeepers will no longer be able to prevent end-users from choosing between your applications and their own in their default settings.
Are you a payment service provider, digital identity provider or an ad-tech seller? The Gatekeepers will need to allow your services to interoperate and function on the same way and on the same terms as their own services.
Are you a developer of a number-independent interpersonal communication service? The Gatekeepers will need to enable interoperability between their service and yours.
Are you a publisher or advertiser? Gatekeepers will have to inform you about the calculation methods of prices for advertisers and remuneration of publishers. Gatekeepers will also have to give you free-of-charge access to gatekeepers’ performance measuring tools and the data (aggregated and non-aggregated).
DMA aims to improve the business environment of companies that use the services of the Gatekeepers in one way or another. These companies will hopefully have more possibilities and freedom to do business outside the Gatekeepers’ platforms and have better insight into their own customers thanks to greater transparency overall.
Fondia continues to follow the development and if you have any questions regarding the DMA and how it might become relevant for you, please feel free to contact us. Read more about our Data Economy Group.
Lastly, Fondia will soon publish a new article on the sister regulation of the DMA, namely the Digital Services Act. Stay tuned.