Apple Withholds New Technologies from European Union Amid Regulatory Concerns

Apple Inc. has announced that it will withhold a range of new technologies from consumers in the European Union, citing concerns over the bloc’s regulatory measures aimed at controlling Big Tech. The company stated on Friday that Apple Intelligence, iPhone Mirroring, and SharePlay Screen Sharing would not be available to EU users this year. The decision is attributed to the Digital Markets Act (DMA), which Apple claims compromises the security of its products and services.

Apple expressed its apprehensions, saying, “We are concerned that the interoperability requirements of the DMA could force us to compromise the integrity of our products in ways that risk user privacy and data security.”

The DMA imposes strict regulations on dominant tech platforms, prohibiting them from favouring their own services over competitors’, combining personal data across different services, using data from third-party merchants to compete against them, and restricting app downloads to their own platforms. Six major tech companies, including Apple, Microsoft Corp., Google parent Alphabet Inc., and Facebook owner Meta Platforms Inc., have been designated as “gatekeepers” under the DMA, subjecting them to closer scrutiny.

The European Commission responded to Apple’s announcement, stating, “Gatekeepers are welcome to offer their services in Europe, provided that they comply with our rules aimed at ensuring fair competition.”

Apple Intelligence, a suite of AI services, was a highlight of Apple’s recent Worldwide Developers Conference. This technology aims to summarize text, create original images, and retrieve relevant data for users, along with a revamped version of Siri, Apple’s digital assistant. These features contributed to a recent surge in Apple shares, which have risen about 9% since the conference, pushing the company’s valuation to over $3.2 trillion.

However, Apple’s decision means that consumers in the EU, including those in France, Germany, Spain, and Italy, will not have access to these new AI technologies for now. The software is set to launch elsewhere this fall, but only on a subset of Apple devices and in American English.

The exclusion of iPhone Mirroring and SharePlay Screen Sharing from the EU market is also notable. iPhone Mirroring allows users to control their iPhone through a Mac display, while SharePlay enables screen-sharing from an iPad or iPhone to another device for remote technical support.

Apple has had ongoing conflicts with the EU over efforts to curb Big Tech’s market power. The company is expected to receive a formal warning from EU regulators under the DMA regarding its practice of blocking apps from directing users to cheaper web-based subscription deals. This follows a €1.8 billion fine from Brussels regulators earlier this year under traditional antitrust laws.

The rollout of Apple Intelligence is also facing challenges in other regions. In China, where OpenAI’s ChatGPT is banned, Apple is considering partnerships with local companies such as Baidu Inc. and Alibaba Group Holding Ltd. to provide chatbot services.

Apple’s decision to withhold these technologies from the EU may provoke dissatisfaction among consumers, potentially increasing pressure on regulators to reconsider the implications of the DMA.

Main Image: Bloomberg