European Union Initiates Probes Against Tech Giants Apple, Google, and Meta for Potential 'Heavy' Fines

The European Union has initiated investigations on Apple, Google, and Meta, the parent company of Facebook. They are suspected of not following a new important European law aimed at encouraging competition in digital services.

The European Commission has expressed concerns that the practices of these three companies may not fully comply with the Digital Markets Act (DMA), which became effective recently. If the investigations reveal non-compliance, they could potentially face substantial fines, as stated by European Commissioner Thierry Breton.

The DMA aims to ensure that dominant online platforms offer users more choices and allow competitors more opportunities to compete. Currently, the regulations apply to the three tech giants under investigation, along with Amazon (AMZN), Microsoft (MSFT), and ByteDance, the Chinese parent company of TikTok.

According to the EU, by mid-May, the list of companies subject to the DMA could expand to include Elon Musk's X and Booking.com.

Violating the new law can result in severe penalties, such as fines reaching up to 10% of a company's global revenue or up to 20% for repeated violations. For many companies subject to regulation, this could mean facing penalties amounting to tens of billions of dollars.

The European Commission is currently investigating certain practices, including what it refers to as Meta's "pay or consent" strategy. In October, Meta (META) introduced a subscription service called "Subscription for no ads," allowing Facebook and Instagram users in Europe to pay up to €12.99 ($14) per month for an ad-free experience.

The Apple iPhone 15 series is displayed for sale at The Grove Apple retail store on release day in Los Angeles, California, on September 22, 2023.

The Apple iPhone 15 series is displayed for sale at The Grove Apple retail store on release day in Los Angeles, California, on September 22, 2023.

Patrick T. Fallon/AFP/Getty Images

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The Commission expressed concerns about Meta's 'pay or consent' model, stating that it may not offer a true alternative if users choose not to consent. This could lead to the continued accumulation of personal data by large companies.

A spokesperson from Meta stated that offering subscriptions as an option instead of advertising is a common business practice in various industries. They explained that the 'Subscription for no ads' feature was created to comply with multiple regulatory requirements, including the DMA. The company intends to maintain a positive dialogue with the Commission.

CNN reached out to Apple (AAPL), Google, and Alphabet (GOOGL) for their input on the matter.

This is a developing story and will be updated.

Editor's P/S:

The European Union's investigation into Apple, Google, and Meta is a significant step towards addressing concerns over the dominance of these tech giants in the digital market. The Digital Markets Act (DMA) aims to foster competition and provide more choices for users, and the investigations will determine whether these companies are adhering to its principles. The potential for substantial fines highlights the EU's commitment to enforcing the DMA and ensuring a level playing field for all players in the digital economy.

The specific practices being investigated, such as Meta's "pay or consent" strategy, raise questions about the true nature of choice and consent in the digital realm. The EU's concerns suggest that subscription models may not offer genuine alternatives to data collection and personalized advertising, which could have implications for privacy and competition. The investigation's outcome will provide valuable insights into the ongoing debate over the balance between user convenience, data protection, and the promotion of fair competition in the digital market., where innovation and consumer choice are prioritized.