The DMA’s goal is a fairer, more pluralistic internet, not one consisting of five giant websites, each filled with screenshots of text from the other four.
Online consolidation is the result of three related phenomena:
- Network effects: some products and services get better the more they’re used — you signed up for Facebook to talk to the friends who were already there, and then other people signed up because they wanted to talk to you; you bought an iPhone because you wanted to use the apps in Apple’s App Store, then app developers made more iPhone apps because they wanted to attract your business.
- Mergers: Tech giants have almost unlimited access to the capital markets and use that to buy any startup that might grow to be a threat, and to merge with their biggest rivals to eliminate competition.
- High switching costs: Normally, it’s very easy to switch from one technology to another. Computers are universal, and the only computer we know how to make is the one that runs all the programs we know how to write. But tech companies have figured out how to use the law to make it illegal to create interoperable products, because if leaving a product or service means abandoning your friends, your apps, or the media you bought, you will stay with that product or service, even if you would prefer a different one.
The DMA’s tactic is aimed at that third factor: the artificially high switching costs that tech firms engineer into their products to trap you inside their walled gardens.
To lower those switching costs, the DMA will require Big Tech platforms (“gatekeeper platforms”) to offer APIs — gateways to allow other services to connect to their products — so that you can quit a service without abandoning the people, apps and media that matter to you.
The DMA isn’t perfect. Rather than starting with social media (for example, by forcing Facebook to open up to independent, community-managed social media sites), the DMA starts with end-to-end encrypted messaging platforms like Whatsapp and Apple…