• Thu. Feb 22nd, 2024

Technology Digital

I Wish I Was A Technology Digital

Google, Meta Join Push for Digital Openness as EU Regulation Takes Aim at Tech Giants

Key Takeaways

  • Google, Meta, and other technology companies launched an alliance called the Coalition for Open Digital Ecosystems (CODE) as the European Union ramps up efforts to regulate big tech.
  • The coalition’s launch comes after the Europe’s Digital Markets Act (DMA) went into full effect, enforcing stricter regulations for “gatekeepers” including Google, Meta, Apple, Amazon, and Microsoft.
  • If a company doesn’t meet DMA standards, it may be subject to hefty fines and could even be forced to sell parts of its business or be banned from acquisitions.
  • The initial CODE members are Google, Meta, Motorola, Opera, Qualcomm, Lynx, Nothing, Wire, Honor, and Lenovo.

Google (GOOGL), Meta Platforms Inc. (META), and other tech companies partnered to launch the Coalition for Open Digital Ecosystems (CODE) as the European Union ramps up efforts to regulate the big tech giants.

The coalition’s goal is to “work with academics, policymakers and ecosystem companies to provide evidence-based thought leadership on the topic of digital openness and how it can be delivered in Europe, through the implementation of the Digital Markets Act and in future EU regulatory framework developments,” according to a joint press release.

The Digital Markets Act (DMA), which was proposed in 2020 and became applicable from May 2023, regulates big tech companies to promote competition, consumer choice, and innovation.

In it, the EU named six “gatekeepers,” online firms with a dominant market share and operating in multiple EU countries, including U.S. companies Google, Meta Platforms, Apple Inc. (AAPL), Amazon.com Inc. (AMZN), and Microsoft Corp. (MSFT), as well as China’s ByteDance Ltd., which owns TikTok.

The DMA potentially could raise costs for some tech giants as they become subject to stricter regulations. The EU Commission published a template for reporting on consumer profiling techniques on Tuesday and requires DMA “gatekeepers” to submit corresponding reports in early 2024.

If a “gatekeeper” doesn’t comply with DMA regulations, “the Commission can impose fines up to 10% of the company’s total worldwide turnover, which can go up to 20% in case of repeated infringement,” as well as more severe penalties like forcing a company to sell parts of its business or banning acquisitions for repeat offenders.

CODE’s initial members comprise EU-designated “gatekeepers” Google and Meta, alongside others like Motorola Inc. (MSI), Opera Ltd. (OPRA), Qualcomm Inc. (QCOM), French mixed reality start-up Lynx, tech manufacturer Nothing Technology Ltd., messenger app Wire, as well as Chinese companies Honor and Lenovo Group Ltd.

The coalition has “had a number of conversations in the past few months about what ‘good’ looks like when it comes to digital ecosystems in Europe, what fosters innovation, and what will positively impact competitiveness” and “think[s] openness is the crucial element,” Lynx founder and CODE spokesperson Stan Larroque said in the release.

Meta shares were 0.6% higher in intraday trading on Wednesday following the coalition news, while Google parent Alphabet’s shares were up 0.4%. So far this year, Meta shares have more than doubled in value while Alphabet shares were up nearly 50%.


By admin

Leave a Reply

Your email address will not be published. Required fields are marked *