Wednesday, July 24, 2024

Impending EU Regulation to Force Apple to Allow Third-Party App Stores and Open Up iMessage

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Apple will be forced to allow users to utilize third-party app stores and payment systems, as well as make iMessage interoperable with other messaging services, by the European Union’s Digital Markets Act (DMA), according to a newly published document from the European Commission.


In a questions and answers document on the Digital Markets Act titled “ensuring fair and open digital markets,” published on Saturday, the European Commission explained and clarified what the Digital Markets Act will mean for companies that are designated as “gatekeepers.” Apple is almost certain to be classified as a “gatekeeper,” due to the size of its annual turnover in the EU, its ownership and operation of platforms with a large number of active users, and its “entrenched and durable position” due to how long it has met these criteria, and will therefore be subject to the rules set out in the DMA.

Last week, a leaked version of the DMA, seen by MacRumors, indicated that Apple could be forced to make major changes to the App Store, Messages, FaceTime, third-party browsers, and Siri in Europe. The latest document reiterates that gatekeepers will have to allow users to install third-party app stores, while developers will have to be able to interoperate with a gatekeeper’s own services, promote their offers outside the gatekeeper’s platform and use third-party payment systems, and access data gathered by a gatekeeper.

One of the new additions to the DMA is the requirement to make messaging, voice-calling, and video-calling services interoperable. The document clarifies that a third-party developer will have to request interoperability with a gatekeeper’s service, and the gatekeeper will have to comply within a fixed timeframe. Immediately, gatekeepers will be required to support messaging between users on different platforms, but the DMA includes provisions to expand to group chats after two years, and video and audio calls after four years. The interoperability rules theoretically mean that Meta apps like WhatsApp or Messenger could request to interoperate with Apple’s iMessage framework, and Apple will be forced to comply.

So far, Apple has heavily resisted attempts by governments to enforce changes to its operating systems and services. For example, Apple simply chose to pay a $5.5 million fine every week for ten weeks in the Netherlands instead of obey orders from the Authority for Consumers and Markets (ACM) to allow third-party payment systems in Dutch dating apps.

The DMA says that gatekeepers who ignore the rules will face fines of up to 10 percent of the company’s total worldwide annual turnover, or 20 percent in the event of repeated infringements, as well as periodic penalties of up to 5 percent of the company’s total worldwide annual turnover. Where gatekeepers perpetrate “systematic infringements,” the European Commission will be able to impose additional sanctions, such as obliging a gatekeeper to sell a business or parts of it, including units, assets, intellectual property rights, or brands, or banning a gatekeeper from acquiring any company that provides services in the digital sector.

EU lawmakers provisionally approved the DMA in March. Once the final document is officially published, the European Parliament and the Council will need to approve it before it can come into effect. Digital competition chief Margrethe Vestager said last month that she expects the DMA to come into force “sometime in October.”

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