EU targets Google, Apple under DMA, risking clash with Trump

EU targets Google, Apple under DMA, risking clash with Trump

  • 20.03.2025 12:38
  • newsbytesapp.com
  • Keywords: EU fines, DMA violations

The European Commission has accused Google and Apple of violating the EU Digital Markets Act, potentially facing hefty fines. The move could strain US-EU relations as Trump warns of retaliatory tariffs, while both companies express concerns over compliance and innovation impact.

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Estimated market influence

Google

Negativesentiment_dissatisfied
Analyst rating: N/A

Alleged to prioritize own services in search results and restrict developer options on Google Play.

Apple

Apple

Negativesentiment_dissatisfied
Analyst rating: Buy

Accused of not making operating systems available to competitor devices, risking non-compliance fines.

Context

Analysis of EU vs. Google and Apple under DMA: Business Insights and Market Implications

Key Allegations

  • Google: Accused of prioritizing its own services in search results, violating DMA's mandate for "transparent, fair, and non-discriminatory" treatment of third-party services.
  • Apple: Charged with restricting access to its operating systems (OS) for competitor devices like smartphones and wireless headphones.

Financial Implications

  • Potential Fines:
    • Maximum fine: Up to 10% of global revenue, increasing to 20% for repeat offenses.
    • Apple's projected 2024 revenue: $391 billion → Potential fine: Nearly $80 billion.
    • Alphabet (Google)'s 2024 revenue: $350 billion → Potential fine: Up to $35 billion.

Compliance Requirements

  • Apple: Must make its operating systems available to competitor devices, with a detailed timeline and methodology provided by the Commission.
  • Google: Required to modify how it displays search results, potentially impacting user experience.

Company Responses

  • Apple: Criticized EU decisions, stating they "wrap us in red tape" and could slow innovation for European users.
  • Google: Acknowledged the need for changes but warned that altering search result display could make it harder for users to find information.

Market & Competitive Dynamics

  • Promoting Competition: The DMA aims to level the playing field, potentially benefiting smaller tech companies and fostering innovation.
  • US-EU Tensions: Trump's urging for a softer stance on American tech firms could escalate trade disputes, with possible retaliatory tariffs.
  • Global Impact: The case sets a precedent for regulating tech giants globally, influencing other regions to adopt similar measures.

Long-Term Effects

  • Regulatory Shifts: Likely acceleration of digital regulation in other markets, affecting global tech companies' operations.
  • Strategic Adjustments: Tech firms may need to restructure business models to comply with stricter regulations, impacting profitability and innovation.

Regulatory Landscape

  • DMA Enforcement: The case highlights the EU's commitment to enforcing digital market fairness, potentially deterring monopolistic practices.
  • Global Influence: The outcome could shape international regulatory frameworks for tech industries, affecting cross-border operations.

Strategic Considerations

  • Competitor Advantage: Smaller firms may gain access to larger ecosystems, fostering competition and innovation.
  • Investor Concerns: Significant fines and compliance costs could impact tech giants' stock valuations and investor sentiment.