Europe is right to tighten the screws on Big Tech

Europe is inexorably tightening the screws on Big Tech as a European Union court recently upheld a huge anti-trust fine against Google and a parliament group voted last week to move ahead on a law to ban anti-competitive online behaviour. New EU rules would also boost the power of national authorities to scrutinise acquisitions so online behemoths cannot buy competitors and kill them off.

Google, Apple, Facebook, Amazon and Microsoft, sometimes known by the acronym Gafam, have been accused of a range of violations, including not paying enough taxes, stifling competition, using the media content of others without proper compensation and threatening democracy by spreading fake news. Europe is correct in setting some serious boundaries for them and others.

The latest developments are part of a long-running saga that began with the EU’s first online regulation approved in 2000 when Google was just two years old, Amazon was four and Facebook would not go live for another four years.

The intervening decades included a “Wild West” free-for-all in business, ethics and privacy that saw the Gafam group emerge victorious from the melee. As Big Tech companies developed, even they did not yet know the true power of what they had created. Clearly, entirely new levels of oversight were also needed.

Before the pandemic shifted the focus, online regulation was a centerpiece of new European Commission President Ursula von der Leyen’s agenda when she took office in late 2019. To emphasise the importance, her administration even created a new portfolio called Europe Fit for the Digital Age and put Danish politician Margrethe Vestager in charge with the powers of an executive vice-president.

The EU has already led the way in the modern Internet age with the 2018 General Data Protection Regulation (GDPR), legislating data protection as a fundamental human right and setting the global standard for privacy. Its latest moves, the Digital Markets Act (DMA) and Digital Services Act (DSA), are far more wide-ranging in governing how Big Tech operates.

Using the concept of monitoring and regulating the “gatekeepers” of the digital world, the laws cover services ranging from Uber and Amazon to the App Store and Facebook with rules that span liability, competition, employment and advertising.

The new legislation comes as previous legal sanctions wind their way through the EU court system. The EU has cited Google for three anti-trust violations and imposed fines in excess of eight billion euros. In the first case, filed in 2010 and years in the appeal process, the court has now upheld a 2.4 billion euro fine that penalises Google for giving its shopping service preference in search results.

But regulators want more than existing anti-trust laws in their toolbox. An agreement reached by a group of European Parliament members last week paves the way for EU lawmakers to vote on the DMA next week. The package would then have to be ratified by EU member states to become law.

Andreas Schwab, a German politician and European Parliament member leading negotiations over approval of the DMA, said he is “satisfied that parliament is sending a united message to the market which is ‘game over with unfair business practices in digital markets’.”

As if on cue, Facebook whistleblower Frances Haugen recently made the rounds of European parliaments, ending her tour at both the French national assembly and senate last week.

She praised the content-neutral approach of proposed DSA legislation and called on the EU parliament to “set a gold standard”. She stressed the need to make Facebook more transparent and its data accessible to researchers, NGOs and journalists. She also warned against any exception for trade secrets, arguing it would provide a loophole to refuse access to data.

Lawmakers have also been involved in long negotiations over whether to ban targeted advertising, a big source of revenue for Google and Facebook. As part of a compromise last week, the EU parliament agreed not to ban the practice but to impose severe restrictions, including protection for children and tougher transparency requirements.

But the non-profit Wikipedia Foundation is warning about taking a one-size-fits-all approach, noting that it “applauds European policymakers’ efforts to make content moderation more accountable and transparent” but urges “a more nuanced approach”.

“There is more to the Internet than Big Tech platforms run by multinational corporations. We ask lawmakers to protect and support nonprofit, community-governed, public interest projects like Wikipedia,” it said in a statement.

And not all the recent news from Europe has been bad for Big Tech. Last week the UK Supreme Court blocked a planned $4.3 billion British class action suit against Google over allegations the company unlawfully tracked the personal information of millions of iPhone users.

The top judges unanimously granted an appeal against the country’s first such data privacy case, a move that challenges a string of similar claims in the UK against other companies such as Facebook and TikTok.

Yet whatever support it gets, Big Tech must be feeling the restraints tightening. One surely hopes so. Along with many benefits, the damages from an unfettered Internet are almost immeasurable.

Like the weather, the Internet is now so big and complex it cannot be entirely controlled, but the EU should be applauded for its dogged determination to provide us some shelter from the worst of the storms.

Jon Van Housen and Mariella Radaelli are veteran international journalists based in Milan