Monday, November 28

Silicon Valley trembles: The European Union finalizes a law that will transform the internet


  • In July, the Digital Markets Law will be approved, which will put an end to anti-competitive practices by technology corporations

  • The measure will change the operation of large platforms such as Google, Meta or Amazon, which denounce that security and innovation will be weakened

Is it possible to put limits on the power of Google, amazon, Goal (Facebook), Manzana Y microsoft? The European Union (EU) thinks so. That’s why it lasts the launch of the Digital Markets Law (DMA, for its acronym in English), which for the first time in 20 years aims to regulate the competition in the digital market and curb the abusive practices of internet giants. The law will profoundly transform the functioning of these platformsand that will also affect users.

On March 24, the European Parliament and the Twenty-seven reached agreement on new legislation. Although there are still technical details to be polished, it is expected to be approved in July and come into force at the beginning of 2023. The DMA will affect companies with a capitalization of at least 75,000 million euros or with a turnover in the EU of 7.5 billion or more and have at least 45 million users. These ‘gatekeepers’ are the aforementioned and companies like Alibaba either booking, who must assume certain obligations. If they don’t, they face penalties of between 10% and 20% of their annual global turnover.

For two decades the tech giants they have consolidated their position of dominance in the market with practices that limit competition. Brussels It has pursued these cases and has imposed fines of more than 8,000 on Google, among others, for measures such as favoring its services in the results that appear in its search engine. However, the slowness of these investigations has led to the creation of the DMA, which seeks to limit these empires and give wings to other companies so that they can prosper.

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“In recent years the European Commission has not had the strength to respond to this abuse of power. Now it will be the companies that will have to show that they are not doing it”, explains the German MEP Andrew Schwablaw rapporteur, at a meeting with journalists in Strasbourg in which EL PERIÓDICO participated.

How will it affect you?

The law will transform those platforms as we know them. Thus, it could force messaging applications to be interoperable with other smaller ones if they request it. In practice, this means that from a iPhone you could send a message from WhatsApp, FacebookMessenger or iMessage and received by a user from Telegram on your mobile Android. Thus, users of different platforms “could exchange messages, send files or make video calls”, according to the EU.

This point, of which few technical details are known, is pending evaluation in the European Parliament. Even so, it has ignited the spirits in Silicon Valley and of some experts who warn that the practically impossible integration between different systems of encryption used by these apps could end up jeopardizing the privacy of user data. The big technology companies also denounce that this threatens their business, since they would be forced to open their systems to smaller rivals to allow greater competition. “SMEs will find it easier to grow,” Schwab believes.

The law will also prohibit companies from allowing users uninstall apps installed on each device by default. That will directly hit the business of Google, which since 2019 pays between 8,000 and 12,000 million dollars a year to Apple so that iPhones incorporate its search engine by default, which already controls 90% of searches. The US Department of Justice has accused both companies of abusing their power with that agreement.

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The EU’s effort to regulate technology raises other questions. The law will force some of the world’s most powerful companies to reshape a business that has gotten them where they are. Some experts point out that this could mean that the platforms of Google, Meta, Apple or Amazon are different in Europe than in USA and the rest of the world, something unprecedented.

Another important question is how the EU will ensure compliance with the law. “The Commission is ultimately responsible for the application of the rules,” says popular MEP Pablo Arias, a member of the Internal Market Commission in charge of the DMA. If they do not comply, Brussels reserves the right to stop mergers between companies that “attempt competition”. It is unclear how it will be intervened. “I hope we don’t get to that situation,” he explained. Margrethe VestagerVice President of the EC.

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