When you want to regulate a company like Apple, you will need to be prepared for unexpected, and possibly undesirable, outcomes.
Starting March 7, Apple will be required to comply with the Digital Markets Act (DMA), which mandates the company to allow third-party app stores on its iOS platform. Apple's response regarding these changes has been quite revealing, to say the least. The company's bold statement, which some perceive as hostile, not only unveiled their intentions but also offered a glimpse into their most crucial revenue model.
One possible explanation for Apple's tone is that they are trying to intimidate regulators and soften future decisions against them. Another possibility is that they are simply arrogant and don't mind showing their true colors. A third explanation is that Apple's PR team made a mistake and addressed the issue in a too-forward manner. Actually, forget that last option.
Regardless of the reasons behind Apple's response, it's clear that they are struggling to find the right words to address the situation. Their response has not inspired investors, that's for sure. The company's approach to complying with the DMA could be characterized as the "Apple way," meaning doing the bare minimum to pass the bar while maximizing any benefits for themselves.
Apple's response to the DMA is not unexpected, given their history of finding creative ways to work around restrictions or standards. As previously discussed in my article "Regulating Tech," large businesses with sufficient capital will always find loopholes to circumvent restrictions, much like hackers. In this case, Apple will likely introduce their own "creative" implementation of the DMA.
While the EU's attempts to regulate tech giants like Apple from the top down are admirable, they should also consider the potential negative side effects on consumers, the company involved and the credibility of the EU itself. After all, imposing restrictions that can be easily circumvented may not be the most effective solutions. And, in all honesty, it makes sense for these companies to protect their investments.
A more effective approach for the EU could be to focus on standardizing foundational technologies that bring long-term benefits to consumers, that is, from the bottom up. Naturally, this would require serious investments, insights, and innovative thinking. By creating technological standards that are widely adopted and accepted, other companies will have no choice but to build their products and services on top of those frameworks.
The recent introduction of Rich Communication Services (RCS) as a new standard for SMS is an excellent example of this approach. RCS promises to innovate the way we communicate through text, allowing group chats and other features that have become common among messaging apps. This lays the groundwork for building new messaging applications that can still innovate through unique features while adhering to the standard.
In short, regulators shouldn't act fast, but act decisively. They should invest in standardizing omnipresent technologies that significantly influence the lives of consumers. In fact, perhaps consumers should even get a vote in this process to help establish their core values. And before disregarding this idea due to the slow pace of democratization, we should remember how current approaches may ultimately demand more time and effort.
In conclusion, if regulators truly want to make a difference, they should start from scratch and build upon foundational technology through funding and collaboration. Needless to say, this approach takes time, money, and effort, but it will ultimately have a more positive impact on everybody involved. Only by reconsidering technology from the ground up can we find a solution that will truly stand the test of time.
Update February 16th, 2024
Apple is already implementing its own "creative" solutions to comply with the new regulations, much to the dismay of many users, including myself. With their latest update, progressive web apps (PWAs) will no longer open in their 'native-like' way, instead directing users to their default browser. Apple has defended this change, essentially claiming it's not a bug but a feature, and shifting the blame onto the EU's new rules. In my opinion, this move not only reveals Apple's true colors but also highlights their strategy of implementing user-unfriendly changes and then blaming the EU for them.