The EU is preparing to force Big Tech companies to share their huge troves of customer data with smaller rivals, according to an early draft of its landmark Digital Services Act regulation.
The likes of Amazon and Google “shall not use data collected on the platform… for [THEIR]own commercial activities… unless they [MAKE IT]accessible to business users active in the same commercial activities,” said the draft.
The Digital Services Act, which is expected by the end of this year, is the first big overhaul of the EU’s approach to regulating the internet for two decades. Brussels is hoping to set global standards for the digital economy and to tackle the entrenched advantages enjoyed by Big Tech.
Earlier this month, Thierry Breton, the French commissioner for the internal market, told the Financial Times that the EU was preparing a blacklist of behaviours that so-called gatekeeper platforms would be forced to eradicate from their business practices.
In February, Margrethe Vestager, the executive vice-president in charge of regulating Big Tech, warned that dominant players would be forced to open up their data to smaller competitors.
The draft of the regulation is an early indication that Brussels has committed the ideas to paper and shows that regulators are squaring up for a battle with Silicon Valley.
Tech giants are likely to be rocked by the scale of the EU’s ambitions of curbing companies’ powers, with 30 paragraphs of prohibitions or obligations.
Other parts of the draft include a rule that so-called gatekeeper platforms, those companies that wield huge power because they run the sites or marketplaces that others use to do business, should only be able to use the data they collect for narrow purposes.
“Gatekeepers shall not use data received from business users for advertising services for any other purpose other than advertising service,” the draft seen by the Financial Times said.
The draft suggests that Big Tech may be banned from preferential treatment of their own services on their sites or platforms, to the detriment of rivals, and that companies should not be allowed to pre-install their own applications on hardware devices, such as laptops or phones, or force other companies to exclusively pre-install their software.
Separately, Brussels wants large platforms to let users uninstall any pre-installed apps on devices such as smartphones and personal computers, according to the draft, which is in its early stages.
Regulators are keen to reshape the rules of the digital economy after accusations that online platforms are “too big too care”, with antitrust cases often lasting for years without palatable concessions to improve competition in the bloc.
But they are likely to face pushback from the tech companies. In its submission to the Digital Services Act, Google suggested that existing rules should be modernised rather than “turning to consideration of new and distinct regulatory frameworks”.
It added that regulators should not rush to define certain companies as gatekeepers. “In certain sectors, the platform may have market power; in others, it may be a new entrant or marginal player. The digital ecosystem is extremely diverse and evolving rapidly and it would be misguided for gatekeeper designations to be evaluated by reference to the position of an entire company or corporate group,” it said.
The Financial Times Limited 2020