Google has been charged with breaching landmark EU rules, while Apple has been ordered to facilitate connections for rivals with its iPhones and iPads. This action by the European Commission reflects a continued effort to rein in the influence of Big Tech.
Despite threats from the U.S. President to impose tariffs on countries that fine American companies, both Google and Apple have faced scrutiny from the European Commission since March last year due to concerns over compliance with the Digital Markets Act, which outlines a framework to regulate the power of major tech firms.
The EU competition watchdog has issued preliminary findings against Google for violations related to its app store and search services. The allegations include restricting app developers from informing users about better offers outside the Google Play store and favoring its own services, such as Google Flights, in search results.
Regulators noted that Alphabet restricts app developers from directing consumers to alternative channels, setting excessive service fees for customer acquisition through Google Play. Additionally, it was reported that Google prioritized its own services over competitors in areas like Google Shopping and Google Hotels.
EU antitrust chief Teresa Ribera emphasized that these measures are designed to ensure Alphabet complies with EU regulations for services widely utilized across the EU.
Google has criticized the EU's approach, arguing that the competition rules could impede consumer access to information and harm European businesses. The company's senior director for competition noted that mandated changes to search result displays would complicate user navigation and limit traffic to European businesses.
In response to the EU order, Apple is required to grant rival manufacturers of smartphones, headphones, and virtual reality headsets access to its technology and operating system, ensuring seamless connections with iPhones and iPads. Additionally, Apple must establish a timeline for responding to developers' interoperability requests.
Apple expressed concerns that the EU order would hinder innovation and benefit its competitors. The company stated that adhering to the new regulations would slow down its ability to introduce new features in Europe and force it to provide these innovations without charge to rivals that do not face similar obligations.
Google has faced over 8 billion euros in fines from the EU for previous antitrust violations and could incur fines of up to 10% of its global annual sales if found guilty of breaching the Digital Markets Act. Apple may also face an investigation and potential fines if it does not comply with the order.
Following the news, Alphabet's shares rose 1%, while Apple’s shares increased by 1.6%.