Competition

What is the Digital Markets Act?

To recap, the Digital Markets Act (DMA) is the EU legislation designed to ensure fairness in digital markets by limiting the influence of large technology platforms designated as ‘gatekeepers.’ The Commission can designate a company as a gatekeeper if it provides specific digital services, known as core platform services (CPSs), and meets the criteria.

Why is the DMA relevant to video game companies?

For the video game industry, the DMA’s most immediate impact is on the mobile games sector, whose design and distribution are influenced by gatekeepers' rules. The EC designations within the mobile ecosystem include Apple and Google's mobile app stores, crucial channels for game distribution, as well as their mobile operating systems, which set the technical parameters game developers must adhere to.

How does the DMA aim to create a level playing field for game developers?

To address some of the main competition concerns in digital markets, such as app distribution, the DMA establishes a set of ‘obligations’ for gatekeepers. In the context of mobile games, these provisions include sideloading, requiring Apple and Google to allow the installation of third-party app stores and direct application downloads. Another crucial element is steering, which allows developers to promote and direct users, free of charge, to offers outside of the gatekeepers’ app store. Additionally, the DMA prohibits the bundling of specific payment systems with Apple and Google's app store services.

To reinforce these obligations, the DMA incorporates interoperability and data access provisions. These include ensuring developers have free access to fundamental operating system features and establishing data portability requirements.

What’s been happening with Apple?

Just after three weeks of the DMA's enforcement date, March 7, 2024, the EC launched initial non-compliance investigations to assess whether Apple and Google's DMA compliance terms allowed developers to direct users to external offers. By June 2024, the EC issued preliminary findings to Apple, confirming its App Store rules breached the DMA. Additionally, the regulator initiated a separate investigation into concerns about Apple’s new ‘Core Technology Fee’ applicable to developers achieving significant scale under the new EU business terms.

Why did the Commission fine Apple €500 million?

After more than a year of scrutiny and Apple's subsequent adjustments to address the EC's concerns, the regulator has fined the iPhone maker €500 million for violations related to its App Store practices. The Commission concluded that Apple failed to comply with the DMA's steering provisions, primarily due to the numerous restrictions imposed on developers within the App Store terms.

These limitations are particularly significant for mobile game developers, as they are prevented from informing and directing users to alternative and more affordable options available outside the App Store, such as game web stores. Furthermore, these conditions directly impact developers' revenues by preventing them from avoiding app store fees and offering more personalised options to their users.

As part of its decision, the Commission has mandated Apple to eliminate the technical and commercial restrictions on steering within 60 days and refrain from repeating the non-compliant behaviour in the future. The regulator warned that failure to comply would result in daily fines for each additional day of violation. Apple has confirmed that it intends to appeal the ruling.

In a related announcement, the Commission also shared its preliminary findings from the investigation, initiated in June 2024, into Apple’s contract terms. The regulator indicated that the CTF and the stringent eligibility requirements have hindered developers from distributing their apps through alternative channels. Moreover, users face a cumbersome process to install apps from these alternative sources. Within the gaming industry, concerns are also being raised that these terms hinder the development and effective competition of alternative app stores focused on this sector.

What about the UK?

The UK has also launched app store distribution market investigations. After enacting the Digital Markets, Competition, and Consumers Act (DMCCA) in May 2024, which became effective in January 2025, the CMA initiated two investigations under its new digital competition regime. These inquiries aim to determine if Apple and Google possess 'Strategic Market Status' (SMS) within their mobile ecosystems, including operating systems, app stores, and mobile browsers. The CMA's announcement further outlined potential conduct requirements closely mirroring DMA obligations.

While the initial consultation on the investigation scope and possible inventions closed last February, the CMA is still engaging with stakeholders to collect information and develop initial conduct requirements. In this context, Flux encourages developers to stay informed and actively engage with the CMA on upcoming decisions and consultations.