Apple, like other Internet giants, must comply with the European Digital Markets Act (DMA) and Digital Services Act (DSA). This opening up to competition will have concrete consequences for users in Europe.
In his latest book “Of gold and jungle“, Jean-Christophe Ruffin imagines a high-tech company, which could be a Silicon Valley giant, plotting an armed operation with secret agents to seize a state (in this case the Sultanate of Brunei) to put an end to the burdensome regulations of democracies.
Let us not reveal anything about the outcome of this fascinating book, but consider that it poses a real question for companies whose capitalization exceeds that of certain States and which are still reluctant to comply with the rules laid down by States, and in particular the European Union.
The GAFAM (Google, Amazon, Facebook, Apple, Microsoft) have no intention of taking over a state, but they are deploying great imagination and colossal sums of money to avoid meeting regulatory requirements. In the run-up to the last European elections, the environmental association Agir pour l’Environnement published a report revealing the “top 100 European lobbies”. Meta (Facebook’s parent company) was No. 2 with €8 to €9 million spent, followed by Apple in No. 3 with €7 to €8 million and Microsoft in No. 4 with €7 to €8 million. Google was 9th with €5.5 to €6 million.
Despite these enormous sums, GAFAM are obliged to meet the new requirements. In the constantly evolving landscape of technology, the European Union has once again marked its territory by imposing regulations on tech giants, through the Digital Markets Act (DMA) and the Digital Services Act (DSA). These laws aim to create a fairer and more secure digital environment.
Among the most impacted players, Apple must now make significant changes. The DMA and DSA are designed to limit the power of large digital platforms and strengthen the protection of personal data. For Apple, this means opening up its traditionally closed ecosystem. The company will therefore have to allow the installation of applications from third-party sources, in other words authorize the “sideloading” of applications outside its own application store, the App Store.
More choice and freedom for consumers
This upheaval has come to fruition in the latest version of iOS (17.4) for iPhone users, giving them more choice and freedom. Consumers can install apps that are not available on the App Store, potentially at more competitive prices.
This increased flexibility could foster innovation, allowing developers to offer apps without the constraints of Apple’s policies and its commission that it takes on every app or subscription. By forcing Apple to open up its ecosystem, the European Union hopes to stimulate competition.
Furthermore, developers will be less dependent on the conditions imposed by Apple, which could lead to a diversification of the application offer and a reduction in costs for users.
Increased security risks
But these changes are not without consequences. Opening up to third-party applications raises security concerns. Apple has always emphasized the strict control of its App Store as a guarantee of security for its users. “Sideloading” could therefore expose devices to malware, requiring increased vigilance on the part of users.
One of Apple’s strengths is the seamless integration of its hardware and software. By allowing apps from outside the App Store, there is also a risk of fragmenting the user experience, with apps that may not meet Apple’s quality standards.
An adaptation challenge
For Apple, these changes require a reevaluation of its business strategy. The Cupertino company will have to find a balance between regulatory compliance and maintaining its quality standards. Implementing new security and support measures will be crucial to ensure that users benefit from a quality experience.
Adapting to the DMA and DSA regulations represents a turning point for Apple and its users. But Apple has shown that it can adapt. For example, it fought against the USB-C chargers imposed by Europe by arguing that its proprietary Lightning port was more innovative. But it complied, and users were ultimately happy about it.
Other platforms than Apple affected
Apple is obviously not the only one that will have to comply with EU requirements. Google will also have to modify its Android ecosystem to allow more freedom for third-party applications. Amazon will have to adjust its business practices, particularly regarding the promotion of its own products. Facebook (Meta) will also be impacted by stricter rules on data management and algorithmic transparency. Microsoft could be affected by regulations on its cloud services and communication platforms (Teams, Skype). And finally, TikTok will have to comply with increased requirements in terms of moderation and protection of user data.
By imposing a system of regulation and openness, the EU is setting the tone, and even in the United States, some would like to take inspiration from the European regulatory model. But beware, these regulations could both encourage and hinder innovation, depending on how companies choose to adapt. Companies may face increased costs to comply with the new rules, which could slow down the development of new technologies. For example, the next iPhone boosted with artificial intelligence could see this key feature not be deployed right away in Europe.
Tech companies will need to invest resources to understand and comply with new regulations, which could divert funds and energy from other innovative activities. Finally, as ecosystems open up, there will be a need to innovate in security solutions to protect users from potential threats.
