Greater benefits for users and a fairer digital market

Five main areas in which we need to amend the Digital Markets Act

Greater benefits for users and a fairer digital market

Five main areas in which we need to amend the Digital Markets Act

The fall has come and the negotiations of the Digital Markets Act (DMA) resume. As shadow rapporteur, I have put together a total of 139 amendments, which aim at filling the gaps in the Commission’s proposal. This important legislation should redress unequal market conditions, give smaller companies market space and introduce more options for users thanks to diverse competition.

More about the Digital Markets Act, you can read in my previous blog post. Digital markets have substantially evolved over the past two decades and it is essential that we set appropriate rules and straighten out the market. What changes need to be reflected in the final form of the legislation?

1. The scope of core platform services is not sufficient

The current proposal focuses only on certain so-called core services of the platforms where the problems are most obvious and pronounced. That are considered as most important gateways for business users and customers and where the concentration of limited number of large on-line platforms can lead to weak contestability of the market. However, it is appropriate to expand the scope.

The IMCO Rapporteur has decided to reduce the scope even further in his amendments. This would, however, be a missed opportunity, especially from the perspective of smaller companies.

We need to go the other way and enlarge the list of core platform services and include business to business cloud, embedded digital services in vehicles, web browsers, virtual assistants, connected TVs, and collaborative economy services. Conversely, I proposed to explicitly exclude certain services, such as non-commercial Free and Open Source Software.

2. Let’s lower thresholds to catch all potentials gatekeepers

In addition to expanding the scope, it is important to set the right threshold, the limit that the platform must meet in order to qualify it as a gatekeeper. The Commission’s proposal speaks of 45 million active end-users per month located or established in the European Union. At the same time, they should have an annual turnover within the European Economic Area equal to or above EUR 6.6 billion in the last three financial years and provide the core platform services in at least three Member States.

In line with the figures in Commission’s impact assessment, I reduced the thresholds to EUR 5 billion and 30 million active users and the core platform services provided in at least two Member States to capture more potential gatekeepers. However, I keep the provision of one core platform service, as proposed in the Commission’s original proposal.

The approach of the Rapporteur is also the opposite in this area. In his proposals, he limits the threshold, so that only the so-called big five GAFAM (Google, Amazon, Facebook, Apple, and Microsoft)—and potentially Alibaba—qualify as gatekeepers. In my view, this step would undermine the potential of the Digital Markets Act in regulating several current and future gatekeepers, possibly European operators who use unfair practices towards users. The legislation should not narrow the scope according to today’s digital market configuration but should also ensure regulation that is ready for the future.

3. Steps to limit the power of gatekeepers over consumers

The Digital Markets Act should have the main impact on consumers in particular. In its current form, however, it focuses essentially on interest of businesses and consumers supposed to only benefit indirectly from it. That needs to change. The consumer should always come first. For example, we should put greater emphasis on consumers by involving consumer rights organizations in the decision-making process. It is not sufficient to impose interoperability obligation for the benefit of business users, but also of consumers.

End-users are similarly affected by the unfair practices of gatekeepers and their interests should be taken into account. Our aim should be lower prices of products and services, higher quality, as well as more choice and more innovation.

4. Strengthen interoperability allow more choice for users and more opportunities for smaller businesses

My amendments extended the legislation to end-users, not just business ones, and strengthened provisions on interoperability, switching, pre-installed software, and portability. Thanks to interoperability, users will not only be able to communicate with friends across platforms, but also transfer their data from one to another, or switch from one service to another. User should also have the possibility to uninstall pre-installed software that they don’t need.

One specific example where users could benefit from this is number independent interpersonal communication services (like messaging services) and social network services. It seems normal to us today to be able to send e-mails across different providers. Why can’t we send messages from one chat platform to another?

Anyway, we had to make sure that the existing data portability rights under the General Data Protection Regulation (GDPR) is strengthened in the Digital Markets Act. We should provide effective portability of data generated through the activity of users. In particular, it is essential that end users can use tools to facilitate effective portability of their personal data. Especially, personal data generated through their activity on platform.

5. Put measures in place to stop gatekeepers from using their market and data power to leverage to new markets

Let’s take killer acquisitions, which are important phenomena on the market and need to be addressed. Acquisitions of nascent competitors by gatekeepers should be reported adequately to the Commission, which has to assess the impact on the market.

In order to ensure the effectiveness of the review of gatekeeper status as well as the possibility to adjust the list of core platform services provided by a gatekeeper, the gatekeepers should inform the Commission of all of their intended and concluded acquisitions of other providers of core platform services or any other services provided within the digital sector.

Such information should not only serve the review process mentioned above regarding the status of individual gatekeepers, but will also provide information that is crucial to monitoring broader contestability trends in the digital sector and can therefore be a useful factor, including for consideration in the context of the market investigations foreseen by the regulation, as well as trigger behavioral or structural remedies on gatekeepers to restore contestability and fairness on digital markets.

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