The EU's DMA: The Road to Hell is Paved With Good Intentions
It all started with the misguided cookies law, then came GDPR, and now the DMA, the Digital Markets Act. And this is not enough, the same people who already failed miserably at least three times before are now working hard to also kill all AI innovation in Europe. Or as Wall Street Journal's Greg Ip put it on the front page in January: "Europe Regulates Its Way to Last Place".
"From mergers to AI, the EU’s aggressive rule-making hampers its ability to compete with China and the U.S. [...] There is one field where the European Union still leads the world: regulation." [Greg Ip, Wall Street Journal on Jan 31, 2024]
As someone who is an entrepreneur who welcomed the idea of Austria becoming part of the EU in January 1995, I basically cannot understand what has been going on inside the brains of EU politicians during the last 20 years. Sure, we are not sending the "crème de la crème" to Brussels, but still...
If you read the comments of Margrethe Vestager or Thierry Breton, both leading figures behind the DMA, three things are pretty clear (given that they really believe what they say):
- They have no clue about the global IT market dynamics
- They are totally misguided about the importance of Europe within the global digital markets (e.g., the EU's share of global Apple App Store revenue is probably less than 7% -- based on current, publicly available financial statements)
- They are completely wrong that the majority of EU developers want these changes (for instance, they are indirectly forcing indie developers to publish their phone numbers -- this not just dumb, this is insane)
- They are completely wrong that the majority of EU users want these changes (or even care about them, e.g., a good example is Android: everyone can distribute apps, but only Google's Playstore really makes any significant revenue)
- And apparently, they have no idea what the words "simple", "easy" or "unbureaucratic" mean (just take a look at the definition of a "trader")
Again, just like with GDPR the EU will achieve the opposite of what they set out to: they will or are already hurting the European IT companies -- not the big players. For the big players these things are annoyances, for a small company or an individual developer it might just be the final blow to either give up or immigrate to a country that is not as opposed to innovation as the EU 27.
"Trader means any natural person, or any legal person irrespective of whether it is privately or publicly owned, who is acting, including through any person acting in his or her name or on his or her behalf, for purposes relating to his or her trade, business, craft or profession." [REGULATION (EU) 2022/2065 OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 19 October 2022 on a Single Market For Digital Services and amending Directive 2000/31/EC (Digital Services Act)]
You know, GDPR compliance has cost European IT companies billions of Euros, even though most companies are B2B companies and should not even have been affected by the law in this way. But in Brussels of course no one cares.
And I am not saying the core idea behind GDPR is bad, but the law and how it is executed in the member states is a bureaucratic nightmare with little concrete value. And the same is true for the DMA: it is overly complex and targets the wrong problems, e.g., forcing indie developers to publish their phone numbers and (typically) private home addresses on the Apple App Store or the Google Play Store.
But it is not just IT. The EU is over-regulating everything from cars to farms to finance and slowly this kills our economy. Which is tragically comical: as the EU was born as the "European Economic Community (EEC)" in the 1950s with the main goal to form an economic community to better compete in the emergent global markets.
"The European Communities (EC) were three international organizations that were governed by the same set of institutions. These were the European Coal and Steel Community (ECSC), the European Atomic Energy Community (EAEC or Euratom), and the European Economic Community (EEC); the last of which was renamed the European Community (EC) in 1993 by the Maastricht Treaty establishing the European Union." [Wikipedia article about the "European Communities"]
And they keep on going even though they must have some idea that the majority of EU inhabitants do not share their beliefs. Are they really so naive that they think the reason why the far right parties get so many votes are only the migration problems? Have they learned nothing from Brexit or the recent farmer protests throughout Europe?
To be honest, if I would not have my family here in Europe I would have already left the continent for the US or Canada. North America is also not the golden land, but for an IT entrepreneur, the EU commission and parliament make it very clear that you are not welcome in the EU. Unfortunately, this is not overdramatic, it's reality.