Do you still remember 2018 when the GDPR started to be applicable? This European legislation led to a massive impact for our industry, with all the companies having to implement quite a lot of things (such as Consent Management Platforms) in order to be compliant with the new law.
While everyone has heard about the GDPR, we have the feeling that not that many have heard about the Digital Markets Act (DMA) and the Digital Services Act (DSA). These two legislation are however probably the most important pieces of legislation for our industry since the GDPR. So if you haven’t heard about them yet, we highly recommend you to go through this article.
The purpose of this article is not to go into all details of the differences between DMA/DSA, but to lay down the most important elements coming out of them and their implications.
What the heck are the DMA/DSA?
While GDPR was focussing on ensuring that the advertisers respected the privacy of their users and that they handle their personal data correctly, the DMA is now addressed towards the “Gatekeeper" aka the biggest tech giants:
- Alphabet (=Google)
- Amazon
- Apple
- ByteDance (=Tiktok)
- Meta and
- Microsoft.
This is nonetheless just the first list of so-called “Gatekeepers”. The EU parliament could at any time add other players to this list who would then also have to comply within 6 months to the legislation.
The DMA/DSA are basically laying down certain rules for these big platforms in the form of a list of “dos” and “don’ts”. These latter are aimed to stop them from imposing what the EU instances consider as “unfair conditions” on businesses and consumers. By unfair conditions, the EU refers to practices such as including ranking services and products offered by the gatekeeper itself higher than similar services or products offered by third parties on the gatekeeper's platform or not giving users the possibility of uninstalling any preinstalled software or app.
Looking at all these do’s and don’ts from a high level perspective, they can be summarized in 3 pillars:
- Fairness towards the other digital players (more covered by the DMA)
- Transparency towards the users (more covered by the DSA)
- Safety / Consent towards the users (more covered by the DSA)
What will be the impact of the DMA/DSA?
As usual with these types of law, the full impact of it & how it will actually be put in practice will still need to be seen in the coming month. What is clear is that the fairness pillar will be the one which will impact the gatekeeper the most. With it, the EU clearly aimed at the “walled gardens” that these companies have built over the years and that have made their huge financial success. But to date, it still raises a lot of unanswered questions:
- Will Google have the obligation to offer other players the possibility to place ads on their Google network (SEA, YouTube, etc) without their proprietary Google Ads tool ( a bit like they had to open their shopping service to other players)? The same question applies for Meta, Bytedance, Amazon and Microsoft within their own network.
- Will Apple have the obligation to allow other app downloading stores than their App store on their iphone & macs ?
- Will Amazon have to open the possibility to place products on their website via non proprietary tools?
- …
The transparency pillar, however, is probably the clearest and easiest one for them to implement. The Gatekeepers will simply need to inform their users more about what data is being used on their platform and for what purpose. We have already seen more and more pop ups emerging on the websites of these Gatekeepers going in that direction.
Regarding the last pillar, the Safety & Consent pillar, Gatekeepers will have to clearly demonstrate how they are ensuring safety on their platforms, and how they are collecting the consent of their users before using their data. Following the GDPR and up until now, this was the responsibility of the advertisers (via the infamous cookie banners), but the Gatekeepers will thus now share that responsibility. Google has already announced that they will make their consent mode tool mandatory for anyone wanting to continue using the audience and measurement features of their advertising tools. More information on this can be found here.
All these new rules will need to be respected by the Gatekeepers as from the 6th of March 2024. An absence of compliance could lead to significant fines (up to 10% of the company’s total worldwide annual turnover, or up to 20% in the event of repeated infringements + Periodic penalty payments of up to 5% of the average daily turnover), so it is reasonable to think that all these Gatekeepers will be taking this very seriously and will be implementing a lot of measures to ensure their compliance.
2024 will again be a year of important changes
With the start of the DMA/DSA EU law as well as the suppression of 3rd party cookies on Google Chrome in 2024, it’s fair to say that 2024 will again be a year of big changes in the digital industry. For that reason, we highly companies must keep their eyes and ears open, and ensure they have the needed resources to prepare to cope with these changes. Should your company struggle with these topics, do not hesitate to contact us, we will be more than happy to navigate with you through the storm.
Eliot Dewilde
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