Chinese firm ByteDance, which owns TikTok, has lost its appeal against a European Union decision to designate the company a digital "gatekeeper." The label was applied under the EU's new Digital Markets Act.
The EU General Court in Luxembourg ruled that the designation was warranted under the European Union’s new Digital Markets Act (DMA) because short video app TikTok exceeded relevant thresholds including global market value and the number of EU users.
Labeled companies are prevented from forcing users in the bloc to consent to have access to a service or certain functionalities.
ByteDance had argued that its global market value largely came from China, rather than the EU.
It also said TikTok does not operate an exponential user expansion model and that it was acting as a “challenger” to digital monopolies operated by established platforms such as Meta, which owns Facebook and Instagram, and Alphabet, which owns Google. Both companies are also designated as “gatekeepers.”
But the EU General Court rejected those arguments, finding that TikTok could no longer be considered a “challenger” on the market, unlike when it joined back in 2018.
The judges concluded that TikTok had “succeeded in increasing its number of users very rapidly and exponentially” since then, and that its large number of European users does indeed contribute to its global market value.
The interoperability rule for gatekeepers would seem to apply here, meaning that TikTok would have to open up their messaging service to interoperate with other (non-TikTok) platforms. It’s a great idea in principle, but not easy to get right when end-to-end encryption is also important, at least on some messaging platforms. Should be interesting to see how this plays out.
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The interoperability rule for gatekeepers would seem to apply here, meaning that TikTok would have to open up their messaging service to interoperate with other (non-TikTok) platforms. It’s a great idea in principle, but not easy to get right when end-to-end encryption is also important, at least on some messaging platforms. Should be interesting to see how this plays out.
https://www.eff.org/deeplinks/2022/04/eu-digital-markets-acts-interoperability-rule-addresses-important-need-raises