In wake of a decade of sluggish growth and to provide European customers with better access to digital and online service, European Union is set to unveil a series of new rules governing its digital market on Wednesday. [1] American tech companies are likely to suffer the bigger hit under these new rules as they will be forced to abide by stringent competition, privacy and copyright rules.
The rules to be announced by the European Commission include potentially giving publishers the right to charge Google and other internet companies when they use online content from newspapers or magazines on websites like Google News or Facebook; placing greater scrutiny on internet phones and messaging services like WhatsApp; giving European consumers the right to watch and buy some premium streaming content from different platforms; and providing financial incentives to regional telecom operators like Deutsche Telekom to invest in the region’s mobile and broadband networks. [2]
While the European policy makers claim that they are trying to protect people’s rights in an increasingly digital world by requiring all the market players to follow the region’s stringent laws, some of the US tech companies worry that they will suffer more from the new regime in the digital market. Europe has a history of doubling down stringent regulation regarding Apple’s tax evasion or Google’s antitrust charge. As some of the US companies encroached upon more market shares in Europe than it does on US domestic market, the E.U. has been struggling to strike a balance between encouraging local competition while containing U.S. influences. For example, Spotify, a homegrown success from Sweden, became a worldwide hit through its expansion in the U.S. market. [3]
Whether the new set of rules works to regulate the E.U. market or it is helping regional forces to fight against tech giants from the other side of the ocean remains to be seen.
[1] Mark Scott, E.U. Rules Look to Unify Digital Market, but U.S. see protectionism, The New York Times, http://www.nytimes.com/2016/09/14/technology/eu-us-tech-google-facebook-apple.html?ref=technology&_=0
[2] Id.
[3] Id.