Europe targets Apple and Google in antitrust crackdown, risking fresh Trump tariff clash

Europe targets Apple and Google in antitrust crackdown, risking fresh Trump tariff clash

  • 19.03.2025 19:58
  • msn.com
  • Keywords: antitrust, EU

Europe is targeting Apple and Google with antitrust actions, potentially escalating trade tensions with the U.S. The EU accuses Google of self-preferencing in search results and restricting Android app developers, while Apple faces interoperability demands for iPhones and third-party devices. These moves could provoke Trump-era tariffs aimed at protecting U.S. tech companies from what Washington views as discriminatory foreign regulations.

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Estimated market influence

Apple

Apple

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Analyst rating: Buy

The European Commission ordered Apple to make iPhones more interoperable with third-party devices, which could reduce Apple's market dominance and force it to share intellectual property.

Google

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Analyst rating: N/A

Alphabet was found non-compliant with the DMA, risking fines up to 10% of global revenues. Google faces potential penalties for self-preferencing in search results and restricting app developers' communication with customers.

Context

Analysis of Europe's Antitrust Crackdown on Apple and Google

Key Facts and Data Points

  • Google (Alphabet):

    • Accused of violating the EU’s Digital Markets Act (DMA) in two main areas:
      • Search Bias: Promoting its own services (e.g., shopping, hotels, finance) over third-party competitors.
      • Android Restrictions: Preventing developers from informing users about cheaper alternatives outside Google Play and charging excessive fees for onboarding new customers.
    • Potential fines: Up to 10% of global annual revenues if findings are finalized.
    • Historical fine: $5 billion in 2018 for Android-related antitrust violations.

  • Apple:

    • Ordered to make iPhones more interoperable with third-party devices (e.g., smartwatches, headphones, TVs).
    • Specific measures include:
      • Allowing easier pairing and better data connections with third-party accessories.
      • Enabling file-sharing and streaming capabilities in apps.
      • Providing developers with transparent and timely information for interoperability.

  • Regulatory Context:

    • DMA enforcement marks the first time the EU has mandated specific technical changes for compliance.
    • Trump-era tariffs: Risk of U.S. retaliation if Europe continues targeting American tech companies.

Market Implications

  • Increased Compliance Costs: Both Apple and Google face significant expenses to modify their business practices.
  • Potential Revenue Impact: Fines could reduce profitability, especially for smaller tech firms.
  • Leveling the Playing Field: Enforcement may create a more competitive market in Europe by reducing monopolistic behaviors.

Competitive Dynamics

  • U.S.-EU Tensions: The move risks escalating trade conflicts, particularly with Trump-era tariffs on European goods.
  • Global Precedent: DMA enforcement sets a regulatory precedent for other regions targeting Big Tech.
  • Developer Ecosystem Changes: Easier interoperability could disrupt existing app economies and intellectual property models.

Long-Term Effects

  • Innovation Impact: Compliance requirements may slow innovation or force companies to share proprietary technologies.
  • Regulatory Uncertainty: Unclear how U.S. tariffs will affect European tech companies if enforced.
  • Shift in Consumer Experience: Changes could alter user experiences on Android and iOS ecosystems.

Regulatory Risks

  • Trade Retaliation: Potential U.S. tariffs on European goods, including alcohol and steel, could harm EU economies.
  • Intellectual Property Concerns: Apple claims interoperability requirements force it to disclose proprietary IP to competitors.

This analysis highlights the significant business and market implications of Europe’s antitrust actions against Apple and Google, emphasizing the risks of regulatory conflict and potential long-term effects on innovation and trade relations.