Living Dangerously: The DMA and the Challenge of Balancing Competition and Cybersecurity
As the Digital Markets Act (DMA) enters its implementation phase, the European Commission is investigating whether the proposed solutions of dominant tech firms (gatekeepers) comply with the mandates of the DMA. However, this process is unearthing new concerns about potential side effects and unintended consequences. One such concern is that pro-competition measures could weaken platform integrity and security, exposing end users to data breaches, scams, and privacy risks. Further, the topic is highly sensitive due to its potential geopolitical implications.
However, this debate is inevitable, as DMA mandates aim to promote fair access by opening up gatekeepers’ ecosystems, particularly app stores. The requirements include supporting sideloading (letting users install apps outside the app store), interoperability requirements (requiring smooth integration with third-party services), and obligations to remove anti-steering restrictions (allowing businesses to directly communicate with end users, promote offers, and enter into contracts with them, without going through the gatekeeper).
Against this backdrop, to mitigate the growing risk of polarisation – which has at times affected even academic discussions – it may be useful to identify common ground and outline reasonable principles to guide policymakers in addressing these complex challenges.
Summary:
- Risks to platform integrity and security are emerging as significant concerns in the implementation of the Digital Markets Act (DMA).
- Since policymaking involves trade-offs, the European Commission should assess whether the solutions proposed by gatekeepers align with the goal of fostering competition while maintaining an adequate level of security, ultimately achieving a constrained optimum.
- When evaluating gatekeepers’ technical implementations, it is crucial to account for the substantial differences in their business models.
- Due to information asymmetry between regulators and targeted companies, achieving a proper balance between competition and security requires the active involvement of gatekeepers.
- The experience of initiatives like Open Banking demonstrates that it is possible to promote competition without compromising security.