EU Takes Aim at Big Tech's Power With Landmark Digital Act
The European Union agreed on Thursday to one of the world's most far-reaching laws to address the power of the biggest tech companies (Warning: source may be paywalled; alternative source), potentially reshaping app stores, online advertising, e-commerce, messaging services and other everyday digital tools. The New York Times reports: The law, called the Digital Markets Act, is the most sweeping piece of digital policy since the bloc put the world's toughest rules to protect people's online data into effect in 2018. The legislation is aimed at stopping the largest tech platforms from using their interlocking services and considerable resources to box in users and squash emerging rivals, creating room for new entrants and fostering more competition. [...] The Digital Markets Act will apply to so-called gatekeeper platforms, which are defined by factors including a market value of more than 75 billion euros, or about $83 billion. The group includes Alphabet, the owner of Google and YouTube; Amazon; Apple; Microsoft; and Meta. Specifics of the law read like a wish list for rivals of the biggest companies. Apple and Google, which make the operating systems that run on nearly every smartphone, would be required to loosen their grip. Apple will have to allow alternatives to its App Store for downloading apps, a change the company has warned could harm security. The law will also let companies such as Spotify and Epic Games use payment methods other than Apple's in the App Store, which charges a 30 percent commission. Amazon will be barred from using data collected from outside sellers on its services so that it could offer competing products, a practice that is the subject of a separate E.U. antitrust investigation. The law will result in major changes for messaging apps. WhatsApp, which is owned by Meta, could be required to offer a way for users of rival services like Signal or Telegram to send and receive messages to somebody using WhatsApp. Those rival services would have the option to make their products interoperable with WhatsApp. The largest sellers of online advertising, Meta and Google, will see new limits for offering targeted ads without consent. Such ads -- based on data collected from people as they move between YouTube and Google Search, or Instagram and Facebook -- are immensely lucrative for both companies. [...] With these actions, Europe is cementing its leadership as the most assertive regulator of tech companies such as Apple, Google, Amazon, Meta and Microsoft. European standards are often adopted worldwide, and the latest legislation further raises the bar by potentially bringing the companies under new era of oversight -- just like health care, transportation and banking industries."Faced with big online platforms behaving like they were 'too big to care,' Europe has put its foot down," said Thierry Breton, one of the top digital officials in the European Commission. "We are putting an end to the so-called Wild West dominating our information space. A new framework that can become a reference for democracies worldwide." On Thursday, representatives from the European Parliament and European Council hammered out the last specifics of the law in Brussels. The agreement followed about 16 months of talks -- a speedy pace for the E.U. bureaucracy -- and sets the stage for a final vote in Parliament and among representatives from the 27 countries in the union. That approval is viewed as a formality.
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