Apple and Meta are under investigation by the European Commission for potential violations of the Digital Markets Act (DMA). Apple is being targeted over its 'steering' rules that charge developers for directing users to third-party purchase options. Meta's charges will reportedly revolve around its ad-free subscription services on Facebook and Instagram in the EU. Both companies have been designated as gatekeepers by the EU and are required to comply with certain rules regarding core platform services they offer. If found in violation, Apple could face daily penalties of up to $50 million. The DMA went into effect earlier this year, following investigations into several tech companies including Alphabet, Amazon, ByteDance (Meta), and Microsoft.
Apple's App Store rules have been a point of contention for some time. The company requires apps to use its own purchase system for in-app transactions and collects a 30% commission or 15% for smaller businesses. This has led to criticism from developers, who argue that it stifles competition and drives up costs for consumers. Apple's App Store Guidelines also prohibit the use of external payment systems, such as Oracle Ads, which further limits options for developers.
The EU is not the only regulatory body taking action against Apple's App Store rules. In 2020, Epic Games filed a lawsuit against Apple in the US over similar issues. The case went to trial earlier this year and Judge Yvonne Gonzalez Rogers ruled in favor of Epic, stating that Apple's App Store practices violated antitrust laws. However, the US Ninth Circuit Court of Appeals overturned parts of that ruling in May 2023.
Apple's dominance extends beyond its App Store. The company has a significant presence in various markets around the world, including Japan, Russia, Netherlands, and South Korea. Its market power has been a topic of concern for regulators and policymakers alike.
Meta's investigation comes as the company faces increased scrutiny over its data collection practices and its role in spreading misinformation on its platforms. The EU is also reportedly considering new regulations to address these issues, including potential fines for companies that fail to remove hate speech or other harmful content from their platforms.
It remains to be seen how the European Commission's investigations into Apple and Meta will unfold. However, one thing is clear: the tech industry is facing increased scrutiny from regulators around the world, and companies must adapt to new rules and regulations in order to remain competitive.