The European Union’s Digital Markets Act is now law. It has been since November 1, 2022. The regulation targets a specific kind of company: the “gatekeeper.” These are the largest digital platforms operating in the EU, firms with a durable market position in certain digital sectors. The law does not name them, but it lays out the criteria that define them—user counts, turnover, or market capitalization.
This is not a general tech regulation. It is a competition law. Its entire purpose is to stop these gatekeepers from abusing their market power. The EU believes that for years, the biggest digital firms have used their dominance to lock out rivals. The DMA is designed to crack that lock.
The core of the law is a set of prohibitions. The most significant one, and the one that will likely cause the most friction, is the rule on data. Gatekeepers are forbidden from combining data collected from different services that belong to the same company. This is a direct strike at the business model of companies that own multiple platforms—a search engine, a social network, a video site, an operating system, a browser. Under the DMA, the data from one service cannot be fed into another to gain an unfair advantage.
Think about what that means. A company that runs a dominant social network cannot use the data from that network to improve its search engine or its advertising business, at least not without the user’s explicit consent. A company that runs a dominant operating system cannot pre-install its own apps and services in a way that makes them impossible to remove. The law prohibits a gatekeeper from using its position in one market to muscle into another.
The logic is straightforward. The EU argues that this practice of combining data across services creates an unassailable wall. A new competitor cannot enter the market for, say, online advertising, because the gatekeeper already knows everything about every user from its other services. The DMA aims to tear down that wall, piece by piece.
This focus on data combination is the sharp edge of the law. It is not about breaking up companies. It is about breaking up data silos. The regulation does not force a company to sell off its social network or its search engine. It forces it to keep the data from those services separate. That is a different kind of remedy, and it is a novel one for the digital economy.
The expected outcome is a fairer and more contestable digital market. The EU wants new players to enter. It wants smaller businesses to have a chance. It wants consumers to have more choices. The regulation assumes that the current state of the digital economy is not a natural outcome of innovation. It is the result of large companies exploiting their gatekeeper status to shut out competition.
The DMA is a bet on the idea that the digital economy has become too concentrated. The EU is betting that by forcing gatekeepers to keep their data separate and to stop abusing their market power, the market will open up. Innovation, the thinking goes, will follow. Consumers will get better services and more options.
The law applies only to the largest players. It sets thresholds. A company must have a certain number of users in the EU, a certain turnover, or a certain market capitalization to be designated a gatekeeper. This means the DMA does not apply to startups or mid-sized firms. It is aimed squarely at the giants.
This is the most aggressive piece of digital regulation the EU has yet passed. It is a clear statement that the era of self-regulation for big tech is over. The Digital Markets Act is now the law of the land in Europe. The gatekeepers have been put on notice. The question now is how they will respond.
