Apple and Microsoft reject EU ‘gatekeeper’ label for iMessage and Bing.

Apple and Microsoft reject EU 'gatekeeper' label for iMessage and Bing.

Apple and Microsoft Lobby Against Inclusion in EU’s Digital Markets Act

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In a battle to exempt themselves from new regulatory requirements, tech giants Apple and Microsoft are urging the European Union (EU) to exclude iMessage and Bing, respectively, from the list of designated “gatekeepers.” The disagreement arises from the EU’s new Digital Markets Act—a groundbreaking legislation aimed at curbing the power of big technology companies. The law intends to prevent these behemoths from stifling competition by locking users into closed services.

The primary focus of the legislation is to target companies providing “core platform services” that are susceptible to unfair business practices, such as social networks and search engines. To qualify as gatekeepers, organizations must either have a market capitalization of €75 billion or generate a yearly turnover of €7.5 billion. They must also provide specific services with at least 45 million monthly end users within the EU and 10,000 annual business users.

Once designated as gatekeepers, these companies will face new obligations, including the requirement to allow their services to interoperate with competing applications. Violators could face fines of up to 20% of their global revenues.

The EU is scheduled to publish the first list of gatekeepers this week. However, Apple’s iMessage and Microsoft’s Bing are still being considered for inclusion, as reported by the Financial Times. Both tech giants argue that their respective services lack sufficient popularity to justify meeting the regulatory requirements.

Microsoft contends that Bing should not be subjected to the same obligations as its much larger competitor, Google Search. According to sources familiar with the matter, Microsoft emphasizes that Bing only possesses a market share of 3%. If Microsoft is forced to offer access to rival search engines, it may inadvertently strengthen Google’s existing search monopoly.

On the other hand, Apple claims that iMessage does not have a significant user base in the EU, and therefore should not be classified as a gatekeeper. Consequently, the company asserts that iMessage should not face the same burdens as Meta’s WhatsApp.

The culmination of their lobbying efforts is expected to unfold this week. If iMessage and Bing are deemed gatekeepers, both companies will have six months to comply with the new obligations set forth under the Digital Markets Act.

It remains to be seen whether Apple and Microsoft will successfully persuade the EU to exempt their services from being designated as gatekeepers. The outcome will have far-reaching implications for the future regulation of digital markets in Europe. As the battle unfolds, all eyes will be on Brussels, awaiting the verdict that could reshape the tech industry landscape.