The European Union (EU) has handed out its first significant fines under the new Digital Markets Act (DMA), slamming Apple with a €500 million penalty and Meta with €200 million.
These sanctions, announced on Wednesday, marked a new era in Europe’s crackdown on Big Tech dominance.
The fines followed rising trade tensions, especially with United States President Donald Trump reportedly considering retaliatory tariffs on countries that penalise American companies.
If implemented, this could escalate into a broader transatlantic tech-trade clash.
Apple accused the European Commission of unfair treatment, “These decisions are bad for the privacy and security of our users, bad for products, and force us to give away our technology for free.”
They argued that the EU unfairly targets successful American companies while letting European and Chinese firms operate under different rules.
Meta, owners of Facebook and Instagram also criticised the ruling, saying the firm is being forced to overhaul their business model.
The company had introduced a “pay-or-consent” option in late 2023, allowing users to choose between a free, ad-supported experience (with tracking) or a paid, ad-free version.
EU said the model breaches the DMA, saying Meta has two months to make changes or face daily fines.
The EU competition watchdog said Apple must remove technical and commercial restrictions that prevent app developers from steering users to cheaper deals outside the App Store.
It said Meta’s pay-or-consent model introduced in November 2023 breached the DMA.
The model gives Facebook and Instagram users who consent to be tracked a free service funded by advertising revenues. Alternatively, they can pay for an ad-free service.
Meta is discussing a new version introduced by the EU in November last year. The companies have two months to comply with the orders or risk daily fines.
Apple avoided a fine in a separate investigation into its iPhone browser options after making changes that allow users to switch to a rival browser or search engine more easily. Regulators said these comply with the DMA and closed the investigation on Wednesday.
The iPhone maker was still charged with breaching DMA rules because it hindered users from sideloading, which involves downloading alternative app stores and apps from the web.
Regulators have criticised Apple’s conditions, including a new fee called Apple’s Core Technology Fee. They say these disincentivise developers from using alternative app distribution channels on their mobile operating system, ios.
The EU regulator also dropped Meta’s Marketplace’s designation as a DMA gatekeeper because the number of users fell below the required threshold.
They made it clear that more enforcement was on the horizon. Meta’s Marketplace, which initially qualified as a DMA gatekeeper, has now been delisted due to a drop in user numbers.
However, the EU is still investigating Google’s ad tech empire and Elon Musk’s X (formerly Twitter).
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