The European Union (EU) is tightening its grip on Big Tech, announcing that Apple's iPadOS operating system will now be subject to the bloc's Digital Markets Act (DMA). The decision, which comes after a year-long investigation, broadens the reach of the DMA, which aims to promote fair competition within digital ecosystems. Apple will have six months to ensure iPadOS complies with the DMA's regulations.
The DMA, which came into effect in March 2024, targets gatekeepers – companies that control major online platforms – and lays out a series of obligations aimed at leveling the playing field for smaller businesses. These obligations include allowing users to download apps from outside of the company's app store and interoperate with third-party payment systems.
Apple's iOS mobile operating system, App Store, and Safari browser were already designated as gatekeepers under the DMA in September 2023. The inclusion of iPadOS marks the first time the DMA has been applied based on qualitative criteria, rather than just meeting specific user base thresholds. The EU Commission argued that despite iPadOS not reaching the quantitative benchmarks, it serves as a critical gateway for businesses to reach consumers, particularly within the tablet market.
This decision is likely to have a significant impact on how Apple operates its iPad ecosystem in the EU. Apple may be required to allow users to download apps from third-party app stores, a move that could potentially decrease Apple's control over app distribution and revenue generation on iPads. Additionally, the requirement to interoperate with third-party payment systems could force Apple to open up its in-app purchase system, currently dominated by its own Apple Pay service.
Apple has expressed reservations about the DMA, arguing that it could stifle innovation and weaken user privacy. However, the company has also stated its commitment to complying with the regulations.
The EU's move to extend the DMA to iPadOS is part of a broader trend of regulatory scrutiny on Big Tech companies. Regulators around the world are increasingly concerned about the dominance of these companies and their potential to stifle competition and innovation. The DMA is one of the most ambitious attempts to address these concerns, and its application to iPadOS is a significant development.
It remains to be seen how Apple will comply with the DMA's requirements and how these changes will impact the iPad user experience in the EU. However, one thing is certain: the EU's decision marks a major shift in the regulatory landscape for Big Tech companies.