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Europe's Digital Markets Act Compels Tech Corporations to Adapt

 

Europeans now have the liberty to select their preferred online services, such as browsers, search engines, and iPhone apps, along with determining the usage of their personal online data. 

These changes stem from the implementation of the Digital Markets Act (DMA), a set of laws introduced by the European Union targeting major technology firms including Amazon, Apple, Microsoft, Google (under Alphabet), Meta (formerly Facebook), and ByteDance (owner of TikTok).

This legislation marks Europe's ongoing efforts to regulate large tech companies, requiring them to adapt their business practices. Notably, Apple has agreed to allow users to download smartphone apps from sources other than its App Store. The DMA applies to 22 services ranging from operating systems to messaging apps and social media platforms, affecting prominent offerings like Google Maps, YouTube, Amazon's Marketplace, Apple's Safari browser, Meta's Facebook, Instagram, WhatsApp, Microsoft Windows, and LinkedIn.

Companies found in violation of the DMA could face hefty fines, up to 20% of their global annual revenue, and even potential breakup for severe breaches. The impact of these rules is not limited to Europe, as other countries, including Japan, Britain, Mexico, South Korea, Australia, Brazil, and India, are considering similar legislation to curb tech giants' dominance in online markets.

One significant change resulting from the DMA is Apple's decision to allow European iPhone users to download apps from sources beyond its App Store, a move the company had previously resisted. However, Apple will introduce a 55-cent fee for each iOS app downloaded from external stores, raising concerns among critics about the viability of alternative app platforms.

Furthermore, the DMA grants users greater freedom to choose their preferred online services and restricts companies from favouring their own offerings in search results. 

For instance, Google search results will now include listings from competing services like Expedia for searches related to hotels. Additionally, users can opt out of targeted advertising based on their online data, while messaging systems are required to be interoperable, forcing Meta to propose solutions for seamless communication between its platforms, Facebook Messenger and WhatsApp.