Apple, Meta, and Google's Alphabet Under Scrutiny, EU Launches Antitrust Probes

Apple Inc AAPL, Meta Platforms Inc META, and Google’s parent company Alphabet Inc GOOG GOOGL are now under investigation by the European Union, according to its new Digital Markets Act.

The announcement on Monday signifies the first batch of probes since the act’s recent enactment.

This comes from the U.S. Justice Department’s lawsuit against Apple for allegedly hindering competitors’ ability to integrate with the iPhone, potentially increasing consumer prices, the Wall Street Journal reports.

Also Read: Microsoft Negotiates with European Cloud Providers to Avert EU Antitrust Action

The investigations will focus on whether Apple and Google adhere to regulations mandating that they allow app developers to inform customers of alternative purchasing options outside their primary app stores.

The European Commission expresses concern over the limitations these tech giants may impose on developers’ freedom to communicate with users and market their products.

Additionally, the EU plans to review alterations Google has implemented to display search results within Europe. The law prohibits companies from favoring their services over their competitors.

Another line of inquiry will examine Apple’s compliance with mandates for user-friendly software removal and default setting adjustments on iPhones, including providing choice screens for alternative search engines and browsers.

Meta’s “pay or consent” scheme, which requires European users who opt out of targeted ads on Instagram and Facebook to subscribe for a monthly fee, will also be scrutinized. 

EU regulators have conflicted with major tech companies, imposing substantial fines on firms such as Google and Microsoft Corp MSFT for violating antitrust rules. 

Microsoft attracted scrutiny for its alleged misuse of market power by integrating its Teams videoconferencing application with its Office suite.

Additionally, significant financial maneuvers, such as Microsoft’s $10 billion investment in OpenAI, the parent of ChatGPT, Amazon.Com Inc’s AMZN $1.4 billion merger with IRobot Corp IRBT, and Adobe Inc’s ADBE $20 billion acquisition of Figma, have all been subject to review by EU authorities.

Last week’s reports indicated Meta slashed the subscription cost for its ad-free versions of Facebook and Instagram in Europe to 5.99 euros a month, down from the initial rate of 9.99 euros, to mitigate the concerns of privacy and antitrust authorities in the region.

This adjustment seeks to balance the requirements of EU privacy regulations and the Digital Markets Act’s rules on ad personalization. 

Investors can gain exposure to the U.S. Big Tech stocks via Invesco QQQ Trust, Series 1 QQQ and IShares S&P 500 Growth ETF IVW.

Also Read: EU Cracks Down on Tech Giants: Apple, Alphabet, and Qualcomm in Regulatory Spotlight

Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.

Photo courtesy: William Hook on Unsplash