With today’s formal approval by the European Council, the Digital Markets Act (DMA) has cleared its final hurdle to becoming Europe's flagship law to re-establish fair digital competition. We congratulate the EU for its ambition, determination and hard work to see it through. It has been a comparatively speedy process once it began, and the result is one that gives hope to those wishing for more free and fair competition in the Internet Economy. The DMA is a major milestone toward which the IEF and countless European startups and scaleups have worked for years. This support for Europe’s regulatory efforts has been passionate but often behind the scenes, as the complex relationship with many Gatekeepers in their dual position as both critical infrastructure providers and competitors has made it risky for many to speak up in public.
Since the IE.F’s beginning in 2016, we have staked our future on supporting the largely unseen and often unheard startups and scaleups facing off against monopolists in markets such as search engines, ad platforms, mail providers, operating systems, app stores and more. Most value-add products and services in the Internet economy can’t happen without crucial, market dominant platforms that not only aggregate supply and demand but also then capture verticals and stifle competition and innovation.
Our first major study, “Fair Play in the Digital Arena: How Europe Can Set the Right Framework for Platforms” began to change the narrative around Big Tech in Brussels. It drew attention to the market dominance of so-called “gatekeepers” and called for regulatory reform long before many had realized its importance. Indeed, this chart from our study, now almost 6 years old, still captures the current market situation and how best to approach regulating so-called bottlenecks and gatekeeper platforms.
In this case, the two boxes indicating where new legislation is needed can now be declared successfully achieved.
The Internet Economy Foundation is deeply grateful to the many key actors who made the DMA a reality, especially the EU’s VP & Digital Commissioner Margarethe Vestager; EU Commissioner of Industry Thierry Breton; the European Parliament’s Rapporteur for the DMA, MEP Andreas Schwab; as well as the teams inside the Commission at DG Connect and DG Competition. Their work was met with broad consensus across party lines in the Parliament, as well across the capitals of Europe and its many diverse national governments. Even the European public played a role, making it clear in recent years that they welcome stricter regulation of digital markets and more trust in open and contestable markets.
Likewise, the IE.F has worked with a wide range of civil society and trade federation partners in Berlin, Paris, Brussels and Washington to draw attention to market imbalances and to advocate for a more effective DMA. We tip our hats especially to France Digitale, the German Startups Association, the EU Tech Alliance, Fair Search, the Coalition for App Fairness and DLD, which has provided valuable forums for European digital voices to be heard. We’re also grateful to our friends at Roland Berger, whose research and cooperation has greatly aided our efforts. And finally, we could not have done our part without the generous support of our Foundation Board and Advisory Board as well as our great team, all of whom truly believe that Europe’s digital future is worth fighting for.
Although regulation alone won’t make Europe a technology superpower, the Continent can’t develop global champions without free and fair competition. Now, it’s up to Europe to further develop its innovation ecosystem and better mobilize its talent, science and capital to compete at the highest levels.
This is not the end of the DMA; but rather its beginning. And therefore, our attention turns to the make-or-break issue of enforcement. If Europe can’t mobilize the necessary resources to enforce the DMA in a timely and forceful manner, then all our collective efforts will have gone to waste.
That’s why the IE.F will now be working passionately to build coalitions of like-minded stakeholders in this next phase. Together, we’ll gather market and technical information regarding unfair business practices and ensure that the DMA enforcers are equipped with all the knowledge and insights they need to do their jobs. Stay tuned for more information later this year. If you’d like to help us work to ensure that this victory does not turn sour in 2023, please reach out to us and join this important cause.