As Meta and TikTok file appeals with an EU court, Apple announces modifications to its iMessage service to pre-empt potential compliance conditions
Companies file objections before the General Court
16 November 2023 marked the deadline for companies identified as gatekeepers to challenge their designations under the Digital Markets Act (DMA). Apple, Meta and TikTok each filed appeals with the General Court of the Court of Justice of the European Union. While the firms accepted the designation for some of their services according to the act’s gateway thresholds, they believe other services have been wrongly identified:
Meta objected to the inclusion of its Marketplace and Messenger services, contending that Marketplace is only a consumer to consumer service and that Messenger is only the chat function of Facebook, which has already been designated;
TikTok asserted that the company has been wrongly designated based on the global turnover of its parent ByteDance, which operates most business lines outside of the EU, and that the platform itself is not a social network due to its a “content-led nature”; and
Apple reportedly argued against the inclusion of its App Store as a gateway despite having stated its intent to modify the App Store in order to comply.
The General Court is expected to rule on each appeal before firms are required to comply with core platform service provisions on 6 March 2024. Companies would be required to comply in the interim if appeals aren’t completed by that deadline, however.
Alphabet and Microsoft look towards compliance with the DMA
Both Google’s parent company Alphabet and Microsoft issued statements ahead of the appeals deadline confirming their intent to accept the designations of their services and to focus instead on ensuring compliance with the rules. Alphabet has the largest number of products designated as dominant under the DMA, accounting for eight of the 22 core platform services in scope of the regulation. Its statement reflects a cooperative approach to new EU regulations and comes as the company is already fighting a sprawling antitrust lawsuit in the US regarding Google’s behaviour in the online search market. While Amazon did not appeal its designations under the DMA, the firm has challenged its status as a Very Large Online Platform (VLOP) under the Digital Services Act (DSA) – as has online retailer Zalando.
Market investigations pending as Apple adopts RCS
In addition to the 22 services already identified, the EC is investigating a further four services for gateway designation. Microsoft is currently liable for two core platform services but is facing an additional three investigations into its Bing, Edge and Microsoft Advertising platforms. Apple’s iMessage has also been under investigation, and in a surprising reversal on 17 November, Apple announced that it would support Google’s Rich Communication Services (RCS) standard on iOS – its proprietary mobile operating system – from next year. After repeatedly rebutting the possibility of supporting RCS, Apple’s announcement detailed how its embrace of RCS would allow for encrypted communications between iPhone and Android users, but would not go so far as to end the distinction between ’blue and green bubbles’. Apple has faced growing calls for it to enable messaging interoperability, including from Meta in its appeal to its Messenger designation. While Apple’s adoption of RCS will blunt some of the impact of the EC’s forthcoming decision on iMessage, pre-emptive compliance with the DMA indicates a response to pressure from both EU regulators and its competitors, with consumers poised to benefit.
