Mar 2024

Navigating the impact of the DMA on gatekeepers

Written by Positive Team

Navigating the impact of the DMA on gatekeepers

The European Digital Markets Act (DMA) is a groundbreaking piece of legislation, aimed at making the digital economy fairer and more contestable.

It’s coming into force this month, and Big Tech must comply. The DMA is targeting companies that have a monopoly in the digital market, now referred to as ‘gatekeepers’. You’ll no doubt recognise the names of most of them – Amazon, Apple, Meta, Microsoft and Bytedance (aka TikTok) to name a few. This change will, of course, require careful consideration and planning for all involved. 

Levelling the playing field

The DMA will shake up the status quo, forcing gatekeepers to play fairly. No more tilting the scales through self-preferencing, bundling products, or data hoarding. Gatekeepers will have to open up platforms to rivals and share coveted user intel. The overhaul is certainly coming for core business models as increased competition and transparency become the new reality. 

How businesses and innovators stand to benefit 

Although gatekeepers must abandon unfair advantages, there will still be ample opportunities for innovation. The DMA will unlock a level playing field, spurring competition that breeds better services, increased value, and more consumer empowerment across the tech ecosystem. You’re most likely wondering, what does this actually mean? Well, as a consumer, you can enjoy choice. Fairer pricing will encourage consumer mobility, allowing seamless switching without constraints. It’ll be much easier for you to switch providers without being financially better off with a specific ‘gatekeeper’.

Balancing innovation, regulation, and market 

One of the key challenges gatekeepers face is the potential for increased scrutiny and regulation of their business practices; critics have argued that the DMA could paradoxically stifle innovation as gatekeepers face hurdles bringing new products to market. There are also concerns about discouraging growth investment in smaller platforms that could one day qualify as gatekeepers. Worst case scenario? Companies simply exit the European digital market, reducing choice for consumers, which is actually the complete opposite of what the DMA set out to do after all.

So, mark your calendars for March 6th as Big Tech braces for the DMA rollout, a game changer aimed at fairness in the digital arena. No more monopolistic manoeuvres; gatekeepers must play by the rules. Yet, balancing innovation  and regulation remains crucial to prevent unintended consequences. It’s a delicate dance toward a more competitive and transparent landscape.

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