EU's perspective on the functioning of giant online platforms in the digital economy

Abstract

The digital market has already become a reality in the world. Internet platforms, including so-called gatekeepers, are becoming the primary managers of both the social, scientific, and political content they deliver and the places where providers of goods and services connect with consumers (including other economic operators). Gatekeepers are big tech companies, which within an online platform model develop and manage platforms, as well as rules for business partners and consumers, and acquire data, the most valuable component of the digital market. Due to their size, they have an enormous market advantage over their competitors. Weak contestability and unfair practices in the digital sector are a problem that is more common and more pronounced for some digital services than for others. This applies in particular to widespread and widely used digital services and digital infrastructures, which mostly directly mediate between business users and end users.

Full text

The European Union
Digital Single Market
Europe’s Digital Transformation
Edited by Łukasz Dawid Dąbrowski
and Magdalena Suska
First published 2022
ISBN: 978-1-032-20159-7 (hbk)
ISBN: 978-1-032-20164-1 (pbk)
ISBN: 978-1-003-26253-4 (ebk)
(CC BY-NC-ND 4.0)
EU’s perspective on the
functioning of giant online
platforms in the digital
economy
Adam A. Ambroziak
1
DOI: 10.4324/9781003262534 -2

EU’s perspective on the
functioning of giant online
platforms in the digital
economy
Adam A. Ambroziak
1
Introduction
The digital market has already become a reality in the world. Internet plat-
forms, including so-called gatekeepers, are becoming the primary managers
of both the social, scientific, and political content they deliver and the places
where providers of goods and services connect with consumers (including
other economic operators). Gatekeepers are big tech companies which within
an online platform model develop and manage platforms, as well as rules for
business partners and consumers, and acquire data, the most valuable compo-
nent of the digital market. Due to their size, they have an enormous market
advantage over their competitors. Weak contestability and unfair practices in
the digital sector are a problem that is more common and more pronounced
for some digital services than for others. This applies in particular to wide-
spread and widely used digital services and digital infrastructures, which mostly
directly mediate between business users and end users.
Many countries struggle with the answer to the question how to approach
new reality, where a small number of big companies govern new markets.
Some countries apply their present law to digital giant tech companies, while
others develop new rules for new digital market competitors. The first option
can fail, as the old-fashioned regulations in force are often not sufficient, as they
do not take into account new activities and behaviours of economic actors of
the digital market, especially as they establish new fast-developing online prod-
ucts. The second option leads to different rules applied in various countries,
while the digital activities do not recognise traditional borders. As regards the
European Union, the latter approach, taken individually by EU member states,
could result in the fragmentation of the EU internal market.
The aforementioned problems are present in the European Union, as well.
On the one hand, although the legal framework that harmonises and uniforms
the way entrepreneurs operate in the EU covers a wide scope and is often very
detailed, certain aspects of digital economy seem to escape it. That is because
it was developed before the digital market emerged, which is why it does not
cover some types of behaviour of its actors. On the other hand, some EU
member states launched their work on national regulations in that field, while
DOI: 10.4324/9781003262534 -2

6 Adam A. Ambroziak
others called the Commission to act (Cédric et al., 2020; Amaro, 2020 ; Rose-
main and Busvine, 2020 ; Fletcher, 2021).
After months of discussions and announcements of new regulations, the
European Commission issued a digital package in December 2020. It covers
two new regulations: the Digital Service Act ( European Commission, 2020a )
and the Digital Market Act (DMA) ( European Commission, 2020b ). They
should regulate a significant part of the EU Digital Single Market to the extent
comparable to the creation of the traditional internal market in the early 1990s.
According to the European Commission, the aim of the Digital Market Act is
to enable platforms to use their full potential by tackling the most serious cases
of unfair practices. In consequence, both end users and businesses, which reach
customers through the platforms, can reap the full benefits of the platform
economy. At the same time, new rules should not hamper rapid growth of new
tech companies and development of innovative services.
Taking into consideration recent changes observed in the digital market,
an enormous increase in and the strengthening of the market position of
the biggest companies, as well as recent problems emerging in the field of
competition, the aim of this chapter is to grasp the change in the approach
of the EU competition policy to entities offering online platforms compared
to the existing solutions functioning in traditional economic transactions in
the European Single Market. We put forward a hypothesis that competi-
tion rules targeting digital platforms, especially gatekeepers, will regulate the
behaviour of online market actors to a greater extent than the rules designed
for offline operations.
In order to examine the hypothesis, we will analyse Digital Market Act
(DMA) draft from the viewpoint of the identification of actors that it covers
and responsibilities imposed on them. Currently (October 2021), discussions
on the DMA are pending in the Council and in the European Parliament;
however, one should not expect any major changes within the scope covered
by the study. A separate issue is the strength and strictness of the DMA in
the final version ( Wiggers and Struijlaart, 2021 ), adopted by the Council and
the European Parliament. It seems that both co-legislators look in the same
direction to hardly regulate the presence of the gatekeepers and their behav-
iours ( Altmaier et al., 2021 ; European Parliament, 2021 ; Fletcher, 2021).
The first section of this chapter presents the specific position of online plat-
forms in the global digital market. Then, we discuss how new regulations and
the existing approach to competition rules relate to each other, especially with
regard to the behaviour of operators holding a dominant market position. It
should be noted that the DMA also covers procedures concerning coopera-
tion between the European Commission and the EU member states; however,
this issue remains outside the scope of this study. Further, legal solutions in
the field of identification of gatekeepers and responsibilities entrusted to them
are outlined in the light of previous experiences with the application of EU
competition rules. The chapter finishes with conclusions that specify the scope
of future studies.

Online platforms in the digital economy 7
1 Position of online platforms in the EU digital market
According to Śledziewska and Włoch (2020 , p.96), a genuine revolution for
digital transformation was not so much in the implementation of network sys-
tems in enterprises or e-commerce but online platforms which have worked
out operating models based on the advancing use of the internet, prolifera-
tion of mobile devices, and massively growing possibilities to collect and pro-
cess data. The heart of these platforms lies in intermediation in interactions
between different types of users: business partners, as well as consumers and
buyers of products on offer.
Online platforms are thus another trade and communication channel, par-
allel to the traditional one, a new type of market where demand and supply
meet. In the offline world, a marketplace is often specified by an administra-
tor who ensures the provision of connecting roads, parking lot, space where
products can be displayed for sale (in an open-air market, a shopping centre, or
service facilities), and recently also engages in advertising activities (e.g., adver-
tising a shopping centre). The administrator is very rarely involved in attracting
customers, although recently big shopping centres increasingly inform about
joint promotional campaigns or special offers. An attempt to win a bigger
number of consumers turns into a kind of competition between administrators
of traditional markets (shopping centres). Yet these operations have a limited
geographical scope as they develop only locally and, in most instances, the
administrators do not collect and store consumer data, with the exception of,
for example, loyalty cards or special financial schemes (credit cards) or vehi-
cle registration numbers for parked cars. As observed by Kenney and Zysman
(2016 ), digital platforms can be viewed as a complex mix of software, hardware,
operations, and network. The fact that they ensure access to a combination
of techniques, technologies, and interfaces to a wide group of users who may
build what they want on solid foundations is crucial. It seems, however, that
Śledziewska and Włoch (2020 , pp.99–100) propose a definition that is more
precise from economic point of view and states that online platforms represent
a new business model and operate as internet intermediaries between at least
two separate but interdependent (networked) groups of users who are in fact
two sides of the market within multipartite markets. In other words, platforms
decide on rules of the game and standards binding within them, as a result of
which transaction costs can be reduced; they provide appropriate tools (e.g.,
a browser) and services (e.g., payment schemes) and using data they have at
their disposal, they can match sides to the transaction based on specific crite-
ria. Thus, online platforms rely on a complete business model that integrates
demand and supply, that is, market creation, establishing, or facilitation using
new technologies ( Śledziewska et al., 2017 ).
The aforementioned business model concept merits our attention as, due to
its innovative nature, it is often used as an excuse for certain types of behaviour
of big online platforms which are sometimes considered uncompetitive. Some
researchers openly suggest that it is not a business model but rather a complete

8 Adam A. Ambroziak
business ecosystem, the most advanced form of business network today, or
a highly connected network of organisations, stakeholders, and consumers
involved in exchange, production, innovation, trade, cooperation, and com-
petition that co-evolve with regard to a specific goal or central organisation
( Moss et al., 2021 ). Online platforms are also seen as digital infrastructure that
provides the core functionality for third-party providers to interface and inter-
operate in order to offer complementary products, including services, as well
as serves different functions, often bringing together interdependent groups in
multisided markets ( Moss et al., 2021 ).
In principle, online platforms offer services identical to those available
in the analogue world, they match business partners with consumers. Nev-
ertheless, attention should be paid to two issues: the nature of services and
data. Pursuant to the currently binding EU regulations ( Directive, 2015 ),
the previously mentioned services rendered by online platforms are the so-
called information society services, that is, services provided (a) for remu-
neration as the fundamental requirement of the identification of a service
covered by the freedom to provide services and internal market regulations;
(b) at a distance, that is, without the service provider and recipient being
simultaneously present in the same place; (c) via electronic means (using
electronic equipment) and at the individual request of the recipient of ser-
vices (which excludes acting on the initiative of service providers) ( Direc-
tive, 2015 ). One needs to note that platforms offer multiple services of
a scope wider than currently stipulated in the regulations, including the
part without remuneration from the consumers, which is designed to attract
their attention. This is how they subsidise, for example, access to them to
maximise profit in other fields of activity.
When it comes to data, online platforms have full data of the vendor, like
in the analogue world, but, above all, they have buyer’s data. In the latter case,
these are data that inform about consumer’s movements before the purchase,
his previous experience, how he finds desired products, how he pays for them,
possibly his opinions about the product and the seller, as well as his use of
other services, not necessarily related to the transaction. One could argue that
similar information is gathered by small retail local shops, whose owners know
“everything” about customers from their neighbourhood; however, those data
are less detailed and not so comprehensive as the ones used by tech companies.
At this point, it is worth highlighting that data are sources of very important
value to all companies, especially to platforms. Nowadays, data are considered
a novel source of revenue, and the process of creating wealth from it is called
“data monetization” (Johnson et al., 2017 ; Faroukhi et al., 2020 ; Hanafizadeh
and Harati Nik, 2020 ). The aforementioned value of data is difficult to measure
due to diverse ways in which they are used. Such mechanisms are absent or at
least significantly limited in offline business models. On the other hand, while
in the brick and mortar retail model the consumer has a limited opportunity to
compare products, on online platforms the range of information is much more

Online platforms in the digital economy 9
complete and easier to compare. This is one of the conditions to ensure perfect
competition in the general equilibrium theory.
There are many types of platforms, from a simple transmission of traditional
trade from the physical market to the internet through platforms providing spe-
cific services (e.g., payment, access to media), markers platform, which can be
developed as systems and available content, up to platforms that contain at least
several of enumerated services (the so-called hybrid platforms). In particular,
the latter ones which collect data from diverse activity categories ensure the use
of business partners and consumer data in a wide array of offered services. Thus,
user data acquired in relation with one service can be used for offering another
one ( Kenney and Zysman, 2016 ; Moss et al., 2021 ). Such cross-exploitation of
data enables, inter alia, continuous adjustment of advertising content shown to
the consumers not only while they are looking for a specific product but also
when they use another service of the same service-provider. There are some
reasons why it is important. Firstly, online platforms build their position on a
rapid increase of the number of internet users (both business partners and con-
sumers). Secondly, they offer user-friendly services that fit into the trend of fast
and intuitive communication and use of equipment. Thirdly, platforms benefit
from the economies of scale: growing number of users is accompanied by the
scalability of intermediary services, that is, increased revenue from sales with-
out increasing basic operational costs. Bigger number of both final users and
business partners increases the potential to adjust offers, number of opinions,
and, as a result, the value of transactions and the value of platforms. Fourthly,
they generate revenues mainly from advertisements based on collected and pro-
cessed data and content adjusted to a potential consumer. User attention is at
least as important as user data in monetising services. Fifthly, platforms offer
data which help to generate extra value from network effects. In this case, we
mean mechanisms that work for increasing the population of network users
which increase the benefit involved in being a part of the network to con-
sumers and business partners ( ACCC, 2019 ; OECD, 2019 ; Śledziewska and
Włoch, 2020 ).
As we have already mentioned, online platforms develop dynamically. One
may identify single-sector platforms and enterprises which offer multiple diverse
platforms linked with one another. Recent years witnessed their concentration
( Moss et al., 2021 ) through mergers and acquisitions of smaller actors, includ-
ing start-ups, by bigger operators and the expansion of existing players into new
areas promising for the future. As a result, a holding emerged composed of five
technological global giants referred to as GAFAM: Google (Alphabet Inc. is a
holding established in 2015 by Google), Amazon, Facebook, Apple, and Micro-
soft. Further positions are occupied not by American or European champions
but by Baidu, Alibaba, and Tencet from China, apparently the main competitors
of GAFAM, although today much smaller. The aforementioned companies are
clear leaders of the digital market understood broadly as a market where demand
for services meets supply (including contents) via electronic means ( Table 1.1 ).

10 Adam A. Ambroziak
Growth dynamics of online platforms can be evidenced by a clear increase
in their market capitalisation, that is, the total market value of a publicly
traded company’s outstanding shares. Although the discussed companies were
established in different periods, obvious increases in their value have been
observed in the recent five years ( Figure 1.1 ). According to the latest data
available for September 2021, Apple was a clear leader followed by Microsoft,
Google, Amazon, and Facebook, leaving Chinese enterprises far behind.
Notably, the biggest increases among the discussed companies were reported
in 2014–2021 by Amazon, which has massively expanded its service offer
and was followed by Alphabet (Google) and Microsoft. According to CNBC
(2021 ), the seven biggest tech companies (Amazon, Apple, Alphabet, Micro-
soft, Facebook, Tesla, and Netflix) achieved revenue between US$837,000
(Amazon) and US$55,000 (Netflix) for every minute of the first three months
of 2021. ( Figure 1.2 ) ( CNBC, 2021 ).
As already stated, digital market, especially the operations of digital platforms,
is characterised not by its product but by the seller’s and, above all, buyer’s data.
In the offline realm, both the administrator of shopping space and the seller
do not learn a lot about the buyer. In fact, the latter in principle remains
anonymous until the transaction takes place or is totally anonymous in cash
Table 1.1 Selected services offered by GAFAM
 Google Apple Facebook Amazon Microsoft
Browser Google Search engine Bing
Electronic mail Gmail iCloud mail Outlook
Communicator Hangouts iMessage Messenger,
WhatsApp MSN Messenger,
Yammer
Maps Google
Maps;
Google
Earth,
Waze
Apple
Maps Bing Maps,
StreetSide
Social media Google+ Facebook,
Instagram Twitch/
Goodreads LinkedIn
Cloud Drive,
Google
Cloud
Platform
iCloud AW S,
Amazon
Drive
Azure,
OneDrive,
SkyDrive
Voice assistant Google
Home Siri Boty Echo/Alexa Cortana
Advertising AdWords,
AsSense,
Double
Click,
Ta g
Manager
In News
Feed
Audience
Network
Amazon
Advertising Bing Ads
Source : D. Coyle (2018 ); Statista (2020).

Online platforms in the digital economy 11
transactions. Buyer’s habits remain unknown together with places that s/he vis-
ited previously; usually also nothing is known about his earlier market research
and information collected with regard to offerings of competing operators.
In the digital market, the main products that sellers would like to use are data
about consumer behaviour. Some of the data may be really useful, some are
useless; however, having them and using them in a skilful way may contribute
to the success of the platform and its business partners. Data have become a
particularly relevant product, which is evidenced by a substantial increase in
worldwide amount of data created per year ( Figure 1.3 ).
Data at the disposal of technological companies can be used, first of all, to
optimise product offerings, adjust ads and multimedia communication, as well as
predict consumer behaviour and adjust products to the expectations or (some-
times artificially generated) consumer needs. Another way to profit from data that
has been discovered in recent years consists in using them in the development of
services based on artificial intelligence. Once suitably adapted, these services are
offered to other companies. Consequently, the ability to derive value from data
increasingly determines the competitive position on the market (Śledziewska and
Włoch, 2020 , pp.68–71). We are therefore dealing here with value created in
online commerce by online platforms not only in the form of tangible goods and
services, but also Big Data—large, variable, and diverse data sets.
However, the aforementioned data concern not only consumers but also
business and production processes. In order to ensure the compatibility of pro-
duction processes within both a single plant and an entire conglomerate, as
well as cooperation with component suppliers and recipients of processed or
finished products, it has become necessary to exchange data, including generat-
ing, acquiring, reading, and using data. In order to ensure that huge amounts
of data (predefined, of course) can be used simultaneously by many actors, the
0
500
1,000
1,500
2,000
2,500
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
Apple
Microso
Alphabet (Google)
Amazon
Facebook
Tencent
Alibaba
Figure 1.1 Market capitalisation of big tech companies (in billion US$)
Source : https://companiesmarketcap.com/tech/largest-tech-companies-by-market-cap/ (accessed 20
September 2021)

12 Adam A. Ambroziak
Revenues made for every minute of the first
three months of 2021
0%
200%
400%
600%
800%
1000%
1200%
1400%
0
500
1,000
1,500
2,000
2,500
3,000
2014 (le axis) 2021 (le axis) Change (right axis)
-
100,000
200,000
300,000
400,000
500,000
600,000
700,000
800,000
900,000
Figure 1.2 Market capitalisation of top tech companies (in billion US$)
Source : Own calculations based on https://companiesmarketcap.com/tech/largest-tech-companies-by-market-cap/ and CNBC (2021) (accessed 20 September 2021)

Online platforms in the digital economy 13
data cloud segment is developing. Available financial data indicate a significant
increase in the value of investments in cloud infrastructure ( Figure 1.4 ).
Access to and management of user, producer, and service provider data create
the potential for “platfomisation” of further sectors. The fact is that different
sectors have different potential to operate through platforms. The specific nature
of the digital market in this sphere is confirmed by the fact that the main investor
in future stores of knowledge about production, producers and consumers, and
therefore the entire market is Amazon, followed by Microsoft and Google.
Linked to data collection and processing is the issue of data protection. This
is a particularly important issue from the point of view of both business part-
ners and consumers. As already mentioned, in physical markets, neither the
collection nor the exchange of such detailed data about the production process
or the purchase transaction takes place. In the digital marketplace, this data is
generated, and in order to ensure the trust of consumers and business partners,
which is essential for business development, it is necessary to ensure data secu-
rity. The big tech companies in question are investing heavily in data security,
from the leader in operating systems (Microsoft) to companies providing search
engines (Google) and sales platforms (Amazon) ( Figure 1.5 ).
0
5
10
15
20
25
30
35
40
45
Q2
2016
Q2
2017
Q2
2018
Q2
2019
Q2
2020
Q2
2021
Amazon
33%
Microso
20%
Google
10%
Others
37%
Figure 1.4 Cloud infrastructure service market (in billion US$)
Source : Statista (2020); Synergy (2021 )
0
1,000
2,000
2005 2010 2015 2018 2020 2025 2030 2035
Figure 1.3 Worldwide amount of data created per year in zettabytes
Source : Statista (2019 )

14 Adam A. Ambroziak
The data held by big tech companies are used by them both to attract new
consumers and to offer their services to business partners through advertising
services. The possibility of profiling the recipient of the message, adapting con-
tent to the real or potential expectations, and capabilities of consumers mean
that specific content, including advertising, should only reach selected recipi-
ents. An important indicator of the position of companies on the digital market
is therefore the revenue generated from advertising. The group of largest global
tech companies has evolved quite significantly over the past five years, through
both the strengthening of the position of their largest providers, the emergence
and rapid growth of new operators, and mergers and acquisitions ( Figure 1.6 ).
In 2020, the 25 largest media companies accounted for 67% of all industry
advertising revenues, while five years earlier the same companies accounted for
only 42%. As far as the biggest players are concerned, in 2020 the share of the
top ten global media owners in advertising revenues reached 55.2%, of which
0
10
20
30
40
50
Microso Google Amazon Apple Facebook
2013 2014 2015 2016 2017
Figure 1.5 Selected companies’ patent applications for data security
Source : Statista (2019 )
0
20
40
60
80
100
120
140
2016 2017 2018 2019 2020
Google
37.3%
Facebook
24.5%
Alibaba
8.1%
Bytedance
7.9%
Amazon
5.7%
Comcast
3.6%
Tencent
3.6%
Disney
3.2%
Baidu
3.2%
Microso
2.9%
Figure 1.6 Advertising revenue in billion US$ and shares in top ten global media owners
Source : www.groupm.com/this-year-next-year-global-2021-mid-year-forecast/

Online platforms in the digital economy 15
0
50
100
150
200
250
300
350
400
Amazon
Apple
Microso
Facebook
Google Alphabet
Tencent
Alibaba
Baidu
Figure 1.7 Annual revenues (in billion US$)
Source : www.statista.com/statistics/266282/annual-net-revenue-of-amazoncom/, www.statista.com/statistics/
267728/apples-net-income-since-2005/, www.statista.com/statistics/267805/microsofts-global-revenue-
since-2002/, www.statista.com/statistics/268604/annual-revenue-of-facebook/, www.statista.com/
statistics/266206/googles-annual-global-revenue/, www.macrotrends.net/stocks/charts/TCEHY/tencent-
holding/revenue, www.macrotrends.net/stocks/charts/BABA/alibaba/revenue, www.macrotrends.net/
stocks/charts/BIDU/baidu/revenue .
almost 62% belonged to Google and Facebook. Noteworthy is the very rapid
growth of the position of new players in the advertising market from both
the United States (Amazon) and China (Alibaba, Bytedance—Tiktok) and the
much lower dynamics recorded by, for example, Microsoft.
Ultimately, the solid position of global players in the digital market can be
seen in their annual revenues and the number of active users. According to the
preliminary data, the clear growth leader with the highest annual revenues in
2020 was Amazon, which almost quadrupled its revenues over the past five years
to US$386 billion ( Figure 1.7 ). Other big tech companies also registered an
increase in their revenue; however, the clear leaders were Alibaba (almost six times
growth to US$72 billion) and Facebook (almost four times growth to US$85
billion). Both Microsoft and Apple saw their annual revenues increase to US$275
billion and US$143 billion, respectively. The aforementioned indicates a definite
strengthening of these companies in the digital market through the development
of their respective sub-markets. Given the digitalisation evident in socio-economic
life, especially accelerated by the COVID-19 pandemic, significant increases in the
aforementioned metrics can be expected for these companies.
Related to the aforementioned revenues is a second indicator that determines
both market position, value and, consequently, the market power reflected in
the number of active users. Due to the sensitivity of data treated as commercial
information, companies usually share it only on the occasion of significant
increases. The greater the number of active users, the greater and more diverse
the potential demand, the greater the likelihood of finding customers for prod-
ucts offered by business partners. Of course, due to the specificity and scope
of the services offered, and thus practically operating in different markets, a

16 Adam A. Ambroziak
comparison of the positions of individual companies must take their specifics
into account. However, taking into account the broad definition of the digital
market, the clear leader in recent years has been Facebook with almost 3 billion
active users, although it should be noted that so far it has only offered a social
medium with sales space emerging only recently ( Figure 1.8 ). The remaining
big tech companies offered consumers a wide range of services, from operat-
ing systems and applications through search engines, email, online shops, to
entertainment (games, music, and books). Assuming that the total number of
internet users is 4.3 billion people, the performance of companies in relation
to individual market segments at the level of 1.5–2 billion active users must be
considered particularly high. This also applies to Amazon, which has reached
over 310 million users, but at the same time has become a major player in the
online shop market.
2 Internal market policy and competition policy of the EU
The European Single Market was launched on 1 January 1993. It introduced
four freedoms, including the free movement of services. Although the
foundations of the market were present already in the Treaty establishing the
European Economic Community of 1957, many barriers are still faced in
cross-border business operations. Many legal solutions have been adopted over
this period mainly to harmonise the legislation of the EU member states, that
is, to reduce differences between them. It boiled down to the elimination
of national restrictions and to putting in place common, usually minimum,
requirements that would ensure, inter alia, consumer safety or the protection
0
500
1,000
1,500
2,000
2,500
3,000
Figure 1.8 Active users (in million)
Source : https://review42.com/resources/google-statistics-and-facts/; www.statista.com/statistics/264810/
number-of-monthly-active-facebook-users-worldwide/; https://expandedramblings.com/index.php/
microsoft-office-statistics-facts/; https://news.microsoft.com/bythenumbers/en/windowsdevices; www.
thexyz.com/blog/microsoft-office-365-usage-statistics/; www.windowscentral.com/microsoft-teams-has-
scored-250-million-monthly-active-users; www.businessofapps.com/data/apple-statistics/; https://
9to5mac.com/2021/04/06/poll-has-your-opinion-of-apple-arcade-improved-with-the-arrival-of-classic-
ios-games/; https://techjury.net/blog/amazon-statistics/#gref .

Online platforms in the digital economy 17
of consumer rights. These actions were mostly taken on the basis of shared
competences between the EU and the member states. The result was direc-
tives which have to be transposed into the legislation of all member states and
then implemented. Parallel to legislation strictly concerning the four freedoms
of the internal market, EU competition law was being developed, including
the regulation of corporate behaviour. Due to the exclusive competence of
the European Union in this area, the European Commission became the body
responsible for the implementation of both treaty provisions and secondary
legislation—mainly regulations directly applicable in the member states.
The aforementioned regulations were drafted long before the digital
transformation ( Ambroziak, 2020 ). Some areas clearly necessitate new legal
solutions that would take account of the specificity of the digital market.
Sometimes it is just a matter of adapting regulations existing in the analogue
world to online requirements. More often, however, completely new regulations
must be adopted that address new phenomena that previously did not exist
in the EU internal market. An example of such a case was the emergence of
geo-blocking, which was unknown to traditional offline trade. Geo-blocking
consists in limiting access to or differentiating prices of products (goods and
services) depending on the place of origin of the customer in relation to the
seller. The solutions adopted in this regard, although based on Article 114
TFEU, which implies only harmonisation of laws of the member states, provide
for uniform rules being introduced by virtue of a Regulation, that is, an act
directly and uniformly applicable in all member states ( Regulation, 2018 ). This
rather restrictive approach stems from the critical assessment for more than a
decade of the quality, manner, and correctness of the implementation of direc-
tives by member states, which resulted in the fragmentation of the EU internal
market ( Ambroziak, 2012 ).
The problem is also that laws created sometimes many years ago, even before
the digital age, still apply to both the offline and the online marketplace. Where
there are no digital laws, the application of existing offline laws is extended to
the digital reality. This applies, for example, to the application of the Charter
of Fundamental Rights on privacy, which is often difficult to fulfil in view
of data collection in the digital marketplace (by online platforms, including
gatekeepers and, to a lesser extent, business partners).
It is worth noting that experts point to a wide range of areas where competition
rules are infringed by online platforms. This is often due to their business model and
a tendency of online platforms to transform themselves from transaction enablers
to participation gatekeepers, tying one service to the need to subscribe to another,
discriminatory algorithms deciding the nature and reach of advertisements, but
also influencing the manipulation of the content offered ( Srnicek, 2016 ; Nooren
et al., 2018; Śledziewska and Włoch, 2020 ). A particularly important issue is the
use of the data held by tech giants for their commercial benefit and inflicting the
threats to the privacy of users ( Mushtaq et al., 2020 ).
In the absence of specific antitrust rules for the digital market, it is worth
quoting the existing selected EU rules applicable to undertakings that have
been most abused in recent times in trading via online platforms. This primarily

18 Adam A. Ambroziak
concerns the prohibition of “any abuse by one or more undertakings of a dom-
inant position within the internal market or in a substantial part of it” (Article
102 TFEU). This article enumerates, in fact, cases of abuse of a dominant posi-
tion in the form of
(a) directly or indirectly imposing unfair purchase or selling prices or
other unfair trading conditions;
(b) limiting production, markets or technical development to the preju-
dice of consumers;
(c) applying dissimilar conditions to equivalent transactions with other
trading parties, thereby placing them at a competitive disadvantage;
(d) making the conclusion of contracts subject to acceptance by the
other parties of supplementary obligations which, by their nature or
according to commercial usage, have no connection with the subject
of such contracts.
According to the concept contained in Article 102 of the TFEU, the link
between dominance and abuse is not necessary, while the European Court of
Justice required the compulsory nexus between the aforementioned two ( Mush-
taq et al., 2020 ). This approach is particularly relevant in the context of provi-
sions expected to regulate operations of online platforms which have a dominant
position and are currently accused of engaging into abusive behaviour.
Lengthy explanatory proceedings carried out by the European Commission
are a separate issue. As observed by the European Court of Auditors, as
antitrust enforcement pursuant to the Council Regulation 1/2003 only takes
place after a competition problem has arisen, the duration of the proceedings
might negatively affect the effectiveness of the decisions ( ECA, 2020 ). In
the Commission’s practice to date, proceedings have taken a relatively long
time and possible remedial action has necessarily been immediate. However,
the digital market is developing very dynamically and any actions of large
online platforms have an immediate impact on consumers’ access to goods
and services. At the same time, both their business partners and consumers,
for various reasons, are highly dependent on them. In market economies,
large players with large data sets often trade them for the various products
they offer (goods and services) so that their position becomes monopolis-
tic. Moreover, using various technological tools such as machine learning,
artificial intelligence, and algorithms, big tech companies deliberately try to
strengthen their monopolistic position. In addition, market concentration and
the acquisition of innovative start-ups by big tech companies are an observed
phenomenon ( Kerber, 2019 ; Caffara and Morton, 2021; Crémer et al., 2019;
Cabral, 2021 ; Bendiek, 2021 ).
Consequently, it seems that the Commission’s actions should be fast and effec-
tive, although many experts point to the need for cautious and experimental
action. In view of the rapidly changing situation in the digital market and
the equally rapid adaptations of the major players, experimentation with

Online platforms in the digital economy 19
different (also innovative) legal and regulatory solutions (and learning from
these experiences) is advocated.
Moreover, and this seems most important, EU antitrust law has so far been
based on actions undertaken by supervisory authorities, that is, the European
Commission, ex post in nature. This is because it has been about stopping
and punishing specific behaviours identified and investigated after competition
problems became apparent in the EU internal market. In addition, the very
procedures before the European Commission, requiring multiple explanations,
which allowed multiple stakeholders to speak, ensured, on the one hand,
transparency of actions, and, on the other hand, as already mentioned earlier,
dramatically prolonged the legal response to non-competitive behaviour
of actors operating in the EU ( EPRS, 2020 ; ECS, 2020 ). An example of a
change in the European Commission’s approach towards ex an te action is the
introduction of preventive merger control due to the gravity of potentially
negative consequences for competition ( Council Regulation, 2004 ).
It is worth noting that an additional problem that the EU antitrust legislation
in force on the basis of the Treaties fails to successfully cope with concerns the
occurrence of structural problems with ensuring workable competition in the
market. This concerns situations where the harm to competition is caused by
specific features of the digital market (e.g., network and scale effects, consumer
lock-in). European Court of Auditors assessed that the classic concepts of com-
petition policy rules are not sufficient to define market power and evaluate
competition in digital markets. These markets are often “multi-partite”, that
is, a platform serves as an intermediary between other business partners and
consumers ( ECA, 2020 ).
A separate issue is the relationship between the new competition rules and
data protection and consumer protection law. In the latter case, one may encoun-
ter a serious problem of confronting legislation created for the needs of the
offline economy with the concept of data, which, in principle, does not exist in
the analogue economy. It is now accepted that data today is in fact exclusively
digital. On the one hand, data protection rules should foster trust in the digital
marketplace. Ensuring anonymity both when browsing available content and
when using it, including purchases, should be an important element of this
sphere of regulation. This is why it will be so important to resolve the debate
on the KYBC (Know Your Business and Customers) problem. The question
arises as to whether a platform that de facto acts as a market, that is, a place where
supply and demand meet, must know the data of the business partner and the
consumer. In an offline situation, a shopping mall knows the data of a business
partner but definitely does not know the consumer, that is, his preferences,
previous behaviour, and even less personal data. The reverse is true for many
platforms, where personal authentication is needed to search the available
resources, contact business partners, and finally complete the transaction.
The fact that platforms ensure consumer trust with regard to their personal
data, the extent of their use and impact, for example, through the presenta-
tion of search results, should lead to an improved position of consumers in the

20 Adam A. Ambroziak
market. On the other hand, from the consumers’ point of view, the traditional
offline market does not provide them with full information on the products
on offer, whereas it is the digital market, with a high degree of trust, that can
increase the level of knowledge of the consumers concerned. The consequence
of this may be the improvement of their position on the market in relation to
usually stronger partners—entrepreneurs.
Consequently, the law regulating the activities of consumers on the digital
market should take into account the rights of consumers, their weaker position
vis-à-vis both business partners and platforms. It seems that the latter should
not only be an intermediary, but a possible mediator to protect consumers, as
weaker actors. It is therefore about protecting the position of the consumer
from the point of view of both his trust in the platform and business partners,
the security of the products offered, and the use of personal data ( OECD,
2019 ). The result of such an action should be increased competition, including
between digital platforms, for both better data protection and use in a more
transparent way and traditionally at the level of quality, price, and delivery time
( ACCC, 2019 ). Thus, we would need to ensure the interplay between different
policies and laws and the need for developing integrated policy solutions that
encompass competition policy, consumer policy, data protection policy, and
others ( Kerber, 2019 ; Kira et al., 2021; Miskolczi-Bodnár, 2020 ).
A separate issue is the anticompetitive practices of online platforms consisting
in the manipulation of search results, bundling of applications (requirements to
pre-install certain apps), the use of pricing algorithms disputing the actions of
actors to monopolists, and the use of business partners’ data to introduce their
own brands ( OECD, 2019 ).
Taking the aforementioned into account, it is pointed out that the antimo-
nopoly rules existing in the EU are difficult to interpret in the new, multidi-
mensional, digital reality. Therefore, a systematic analysis and assessment of
entrepreneurs’ behaviour from the point of view of potential abuse of their
market position is needed. However, this is not a static analysis as in the tradi-
tional marketplace, but an innovative approach to the behaviour of entrepre-
neurs operating in the new digital market ( Coyle, 2018 ).
Given both the significant impact and the speed of change in both business
and consumer behaviour in the digital marketplace, the European Commission
considered three options for new legislation: (1) reviewing only the existing
horizontal framework ( Regulation, 2019 ), (2) adopting a horizontal frame-
work empowering regulators to only collect information from large online
platforms acting as gatekeepers, and (3) adopting a new and flexible ex ante
regulatory framework for large online platforms acting as gatekeepers ( Euro-
pean Commission, 2020f ; EPRS, 2020 ).
Finally, in December 2020, the European Commission presented the so-
called Digital Package, one of the key elements of which is the aforemen-
tioned Digital Market Act ( European Commission, 2020b ), already announced
earlier in the Communication on the Digital Future ( European Commission,
2020e ). It is worth noting that the Commission proposed a directly applicable

Online platforms in the digital economy 21
regulation (which stems from the exclusive competence of the EU in the field
of competition policy), however, based on Article 114 TFEU (which is a ref-
erence to shared competence in the functioning of the internal market). It
ensures the implementation of uniform rules, which eliminates the potential
need for national regulations that could fragment the EU market.
The main objective of this legislation is to establish harmonised rules to ensure
a fair and contestable market throughout the EU, thus ensuring that oligopolis-
tic sellers behave as they would in a competitive environment. This means that
the regulations it contains apply only to a specific group of traders and not to
the entire digital market. For this purpose, quantitative and qualitative indicators
have been adopted to define gatekeepers and the obligations they have to comply
with. These obligations are de facto restrictions on the behaviour of big tech com-
panies intended to empower consumers and ensure fairness in B2B relationships
( de Streel, 2020 ; Caffara and Morton, 2021; Portuese, 2021).
3 Definition of gatekeepers in the European Union
The aspect that is crucial for gatekeepers’ identification and definition is the
designation of the framework for the notion of “core platform services”, which
is to be covered by new legal provisions. In the DMA, the Commission proposed
eight categories of services that would be covered by the term: (a) online interme-
diation services
1 ; (b) online search engines; (c) online social networking services;
(d) video-sharing platform services; (e) number-independent interpersonal com-
munication services ( Directive, 2018 ); (f) operating systems; (g) cloud computing
services that enable access to a pool of shareable computing resources ( Directive,
2016 ); (h) advertising services, including any advertising networks, advertising
exchanges, and any other advertising intermediation services provided by a pro-
vider of any of the aforementioned core platform services.
The core platform services defined previously cover a very wide range of
services used by both business operators and consumers in the digital market.
At the same time, due to their nature and the specificities of the market, they
are provided, as previously stated, by a huge number of players in the EU
market. However, this is not a highly diversified market, as most services are
offered by a few large companies that will be considered gatekeepers by the EU
legislation. For the designation of such gatekeepers, in addition to the require-
ment to provide core internet services, conditions have been set regarding their
market position.
Firstly, the gatekeepers should have a significant impact on the internal mar-
ket, which is to be validated by both the extent of its geographical activities
and financial standing. In the first case, it is assumed that out of 27 member
states, it is sufficient that it provides its services in at least three of them. In
the second case, it is a question of achieving a turnover of €6.5 billion in
each of the last three years, or an average market capitalisation (or the equiva-
lent fair market value of the undertaking to which it belongs) of €65 billion
in the last financial year. The European Parliament proposes to increase the

22 Adam A. Ambroziak
aforementioned numbers to respectively €10 billion and €100 billion, as the
DMA should clearly target those platforms that play an unquestionable role as
gatekeepers due to their size and their impact on the internal market ( European
Parliament, 2021 ).
Secondly, it was assumed that gatekeeper provides a core internet service
acting as an important access point through which at least 10,000 active busi-
ness users can reach more than 45 million end users per year. Meeting this
criterion in each of the last three years means, from the point of view of the
new legislation, that gatekeeper has achieved or is highly likely to achieve an
established and sustainable position. The adoption of such clear criteria ensures
that companies offering core platform services should not be able to avoid
being correctly identified as gatekeepers.
However, if the available data were questionable or unreliable or access to
them were difficult, as may be the case for global companies registered, for
example, in China, an additional competence is attributed to the Commis-
sion and a procedure is introduced related to the possibility of considering a
company as gatekeeper also if the aforementioned quantitative criteria are not
fulfilled. In such a case, the Commission should take into account, in addi-
tion to the aforementioned quantitative factors, including turnover and market
capitalisation and the number of business and end users, network effects and
benefits based on data collection and processing, effects of scale and scope of
activities, dependency of the business or end user, as well as other structural
market or service characteristics, including conglomerate or vertical links.
The aforementioned criteria are very imprecise. However, it means that
much smaller companies than those recognised as gatekeepers by the quantita-
tive indicators, which nevertheless offer core platform services and are well
established on the market, can be recognised as gatekeepers. However, the
Commission has to carry out a market investigation beforehand, including pre-
senting its findings to a potential gatekeeper. There is a time limit of 12 months
for this procedure, which is significantly shorter than the standard action under
Article 102 TFEU on abuse of a dominant market position.
The presented approach to identify gatekeepers based on both quantitative
and somewhat more qualitative criteria seems to be correct, as new ventures
of big players may be calibrated in such a way that the quantitative criteria
mentioned earlier would not be met by other business models. Furthermore,
the European Commission, in the course of the market investigation, may
show that a gatekeeper systematically fails to fulfil the obligations imposed on
it, which may result in the imposition of behavioural or structural remedies
proportionate to the gravity of the infringement committed.
The aforementioned definition does not take into account the differences
between gatekeepers in different digital markets. This means that the same
treatment is given to Facebook in the area of social media as to Google in the
area of search engine. This may be due to the nature and operating models
of digital giants that change their roles or start offering products in a formula
offered by their business users. This makes it much more difficult to separate

Online platforms in the digital economy 23
the activities in individual markets and, more importantly, distorts the overall
picture of their activities. As a consequence, a closed list of internet services
defining core platform services may raise doubts. In view of the very rapid
development of individual digital sub-markets, it can be expected that new ser-
vices and gatekeepers will emerge, requiring a response from the Commission.
An answer to this shortcoming is the possibility for the Commission to present
an amended draft of the regulation based on a prior market analysis focused on
new services. However, this procedure is bound to be lengthy. Yet this mecha-
nism may discourage companies from overdeveloping certain new digital areas
and sub-markets for fear of being classified as gatekeepers.
From a procedural point of view, it is important to note that it is the respon-
sibility of the provider to monitor the quantitative indicators in relation to the
individual core internet services and, if exceeded, to notify the European Com-
mission within three months, according to the European Commission proposal,
and one month according to the European Parliament amendment, as the desig-
nation of a company as a gatekeeper should be a fast procedure ( European Com-
mission, 2020b ; European Parliament, 2021 ). The Commission should, within
45 days, designate the provider concerned as a gatekeeper and the list of core
internet services offered. These decisions can be amended following a review
procedure at least once every two years due to a significant change in the market
(except when the decision is based on incomplete or incorrect data).
4 Obligations of gatekeepers
Many obligations have been imposed on gatekeepers as entrepreneurs who
have access to huge amounts of data of both business partners and, above all,
consumers. These have been introduced as a response, so to speak, to the
problems and uncertainties that have arisen to date with regard to the legality of
these companies’ actions. The Commission’s proposal is based on past experience
in competition law enforcement and the effects of ex post actions ( Caffara and
Morton, 2021 ; Anderson and Mariniello, 2021 ; Braeken et al., 2021 ; Bendiek,
2021 ). Thus, we are dealing, on the one hand, with some regulation of firms’
activities and, on the other hand, with business models built on behaviour
currently denied.
At the same time, the Commission has reserved itself the right to extend and
modify the list of these obligations by means of a delegated act adopted as a follow-
up of a market analysis. Firstly, gatekeepers have been ordered not to combine
consumers’ personal data obtained in any way in connection with the conduct of
their business activities. This does not just mean the aggregation of data collected
in the course of providing core internet services, but any other data, including data
outside this catalogue. This separation is also to apply to the registration of end
users as users of other services provided, unless the end user has been given the
opportunity to make a choice and has given his or her consent.
An example of such a challenged action in the EU was Facebook’s notifica-
tion in relation to the collection and use of data obtained in connection with a

24 Adam A. Ambroziak
merger with WhatsApp. Facebook, when notifying the European Commission
of its merger with WhatsApp in 2014, indicated that it would not be able to
create automated connections between users of both platforms (Case M.7217).
However, two years later, WhatsApp announced an update to its terms of ser-
vice and privacy policy, which included, among other things, the ability to
automatically link WhatsApp users’ phone numbers and Facebook accounts. At
the time, the European Commission discovered that such a possibility already
existed in 2014, hence it concluded that Facebook had provided misleading
information in its WhatsApp acquisition notification and it imposed a fine of
€110 million (European Commission, 2017a). It is worth noting, however,
that this was not so much a penalty for automatically linking accounts as for
failing to provide precise information during the notification process. As far as
the linking of data from two independent accounts is concerned, this is a kind
of linking of data obtained from two independent digital markets: the social
medium and a mobile messaging service. Both accounts can be used by the
consumer for completely different purposes, and linking them, from Face-
book’s point of view, gave access to data such as private interests and business
contacts. For consumers, on the other hand, it meant tying content posted on
the Facebook platform to contacts not necessarily related to that content.
Secondly, business users should be able to offer the same products using inter-
mediation services at prices different to those applied on gatekeepers’ platforms.
The point is that large online platforms have prevented their business part-
ners from offering the same products at different, sometimes more competitive,
lower prices on other websites because of their regional or sectoral profile.
An example of this is certainly the case of Amazon’s application of the most-
favoured-nation or parity clauses to e-book suppliers. The latter had to inform
Amazon if they offered more favourable direct or indirect sales conditions out-
side this platform. This concerned prices as well as alternative advertising activi-
ties and sales channels different from those required by Amazon. This amounted
to a restriction of the economic freedom of those doing business with Amazon.
The Commission found that the company’s conduct amounted to an abuse of
a dominant market position within the meaning of Article 102 TFEU (Case
AT.40153). Ultimately, two years after the investigation was opened, Amazon
committed itself in 2017 not to enforce the said clauses obliging publishers to
offer similar non-price and price terms as those offered to Amazon’s competi-
tors, as well as linking discount opportunities for e-books to the retail price
on a competing platform (the so-called Discount Pool Provision) (European
Commission, 2017b). The provision introduced in the new DMA a priori pro-
hibits such actions, as they limit the possibility of attracting consumers to other
platforms. It is worth noting at this point that similar actions, that is, restricting
competition, were also undertaken by smaller online platforms, which argued
that they had to incur advertising costs and maintain the offer on the site, while
transactions took place on other platforms with lower prices.
The third obligation of gatekeepers is to ensure that business users and con-
sumers acquired via the core platform service can carry out transactions and

Online platforms in the digital economy 25
use the acquired services regardless of whether core internet services are used
or not. The idea here is, on the one hand, to ensure that business users can
promote offers and conclude contracts with end users, especially consumers,
regardless of whether they use the core internet services for this purpose or not,
that is, regardless of the platform. The design of the DSM comes down not so
much to classifying individual services, although these are enumerated in the
definition as core internet services, but to businesses having specific platforms
on which multiple services may be offered (e.g., new sales services on Face-
book social media platform).
On the other hand, the idea is to provide end users with the possibility to
access and use content, subscriptions, features, or other elements using the busi-
ness user’s application without being closely linked to the gatekeeper’s platform.
In this way, the gatekeeper can only become a place where transactions and digi-
tal services are performed without the gatekeeper’s involvement and therefore
without potential earnings. The European Commission introduced this require-
ment based on its experience with the case of Apple restricting iPhone and iPad
users to download apps only via the App Store. Apple introduced provisions in
its contracts with business users regarding the mandatory use of Apple’s own
proprietary in-app purchase system “IAP” for the distribution of paid digital
content (with 30% commission imposed on all subscription fees) and restrictions
on the ability of developers to inform users of alternative purchasing possibilities
outside of apps. The complainant of Apple’s discriminatory actions was first its
competitor Spotify (Case AT.40437) and then an e-book/audiobook distributor
(Case AT.40652). It is worth noting here that iPhone and iPad users are specific
consumers due to the limited range of compatible and dedicated applications.
This means that they can only demand in a very specific market of applications
available for their devices. Consequently, the app shop provider is the only entity
that can either ensure supply or allow competition to emerge. Ultimately, the
European Commission has reservations about such an abuse of market domi-
nance by an online platform ( European Commission, 2020c , 2021a ).
The next three orders introduced by the new rules are to address the market
position of business users and gatekeepers. These are (a) refraining from the
requirement to use a platform identification service—it refers to the operations
of, among others, advertising companies that must use a platform’s identifica-
tion service when offering their services, which enables gatekeepers the collec-
tion of data and restricts service providers in using their own identification; (b)
refraining from requiring business users or end users to subscribe to or register
as a condition to get access to any of their core internet services; (c) providing
information to advertisers on the price and remuneration to the publisher for
the publication of an advertisement and other services provided by gatekeep-
ers. In addition, the need to provide advertisers and publishers with access to
performance measurement tools and self-verification of advertising inventory
was identified among the obligations to be further specified.
As an example of the aforementioned restrictions on the freedom of business
users on online platforms, Caffara and Morton S. (2021 ) point to Google’s

26 Adam A. Ambroziak
practices in the case of online advertising (Google adtech) covered by a new
European Commission investigation. This involves preferring its own advertising
technology services and restricting business partners’ access to consumer data that
Google itself uses. By adopting the Google platform as one of several digital mar-
ketplaces, Google both collects consumer data that can be used for advertising
purposes, offers advertising space, and services as an advertising intermediary. As
Google’s operations cover all levels of the supply chain for online display advertis-
ing, the Commission intends to review, in addition to the previously indicated
practices, Google’s requirements for both the use by business users of Google’s
services Display & Video 360 and/or Google Ads and third party “cookies” on
Chrome ( European Commission, 2021b ). From the Commission’s point of view,
Google may hold a dominant position in that particular market and abuse it
through the aforementioned indicated practices. For business users, such behav-
iour by Google significantly deteriorates their position not only on the advertis-
ing market but also in reaching out to consumers in general. In such a situation,
it is Google which is in a better position to tailor and position advertisements on
the basis of data collected on end users, as compared to business partners.
Another, apparently obvious, obligation imposed on gatekeepers by the Digital
Market Act is the requirement to refrain from preventing or hindering business
users from making comments to the relevant public authority on the behaviour
of these traders. Operating in a free market economy, supervisory bodies are
expected to monitor the market and therefore the behaviour of consumers and
producers, in this case digital service providers. Such companies independently
collect market data, but they also acquire data from their participants; hence, the
introduced obligation seems to be obvious, as business users, by their economic
presence on the gatekeeper’s platform, do not become dependent on them.
In addition to the aforementioned obligations, obligations susceptible of
being further specified have been introduced. These are requirements that need
to be further specified in discussions between the European Commission and
gatekeepers. Undoubtedly, regulatory dialogue with gatekeepers is essential, as
this should ensure that “regulations are tailor-made”. At the same time, this
must not lead to avoiding responsibility for practices that breach competition
and consumer protection rules. Failure to ensure transparency in discussions
between the Commission and gatekeepers could lead to the impression that
rules are being worked out for the benefit of large internet platforms only.
The obligations susceptible of being further specified primarily concern the
prohibition of gatekeepers from using publicly unavailable data generated in the
course of the business users’ activities. This includes all data, whether generated
by businesses or consumers, regardless of the scope of services. Most often such
data are used in competition with business partners. After a certain product is
placed on an online platform (which, for example, sells certain goods), it faces
competition from gatekeepers who have much more information about other
business operators and consumer preferences.
An example of the conduct condemned by the European Commission is
the case of Amazon, which used data acquired through its marketplace, where

Online platforms in the digital economy 27
business partners sold their products under their own brand ( European Com-
mission, 2020d ). The problem was that in the different segments of sales made
on Amazon’s platform, in addition to the business users who developed their
position, brand, and products offered, there were more competitive or more
visible Amazon retail offers. In addition, the Commission intends to investigate
whether the criteria that Amazon sets to select a “Buy Box” winner and to
allow sellers to offer products to prime users under the Amazon loyalty pro-
gramme lead to preferential treatment of Amazon’s retail business or a seller
using Amazon’s logistics and delivery services. Failure to qualify for the loyalty
programme puts the trader at a competitive disadvantage vis-à-vis Amazon’s
platform, on which he is fully dependent and whose success or failure is not
determined solely by the product and consumer service but by the decision of
the owner of the online platform.
Another requirement for gatekeepers is to provide end users with the pos-
sibility to uninstall any applications to the core internet service. At the same
time, gatekeepers should be able to restrict this behaviour for applications that
are crucial for the functioning of the operating system.
The example on the basis of which the Commission introduced this restric-
tion was the decision on Google’s practices relating to the pre-installation of
the Android system and default restrictions. Firstly, Google required manufac-
turers of mobile devices to pre-install certain proprietary products in order to
obtain licences for others (the search engine in question). In some cases, this
involved financial benefits for these manufacturers. Secondly, as part of the
“Anti-Fragmentation Agreement”, Google prevented phone manufacturers
from selling them with other Android systems ( European Commission, 2018 ).
The Commission’s concern here was therefore that, in the specific digital
market generated by Google, manufacturers of other devices or applications
should be able to compete with Google’s products.
New regulations also require gatekeepers to allow access, installation, and
effective use of applications offered by a third party, including those obtained
outside of core platform services. However, at the same time, it is ensured
that the gatekeeper should be able to take proportionate measures to ensure
that applications or app shops offered by third parties do not compromise the
integrity of the hardware or operating system provided by the gatekeeper. This
should ensure that the core platform service offered, and therefore the digital
submarket in question, works correctly. Related to this requirement is another
obligation that also needs to be clarified between the Commission and gate-
keepers: to refrain from technically restricting end users from using the various
applications and services that can be accessed using the gatekeeper’s operating
system. This also applies to the possibility of subscribing to such applications
and services, including internet providers to end users. Furthermore, clarifica-
tion of the obligation to apply fair and non-discriminatory general conditions
for business users to access their app shop is provided for.
In the aforementioned cases, the European Commission most probably
had in mind anticompetitive—in its opinion—practices of gatekeepers, who

28 Adam A. Ambroziak
required obtaining applications only from App Store or Google Play, respec-
tively, which meant limiting access to other software dedicated to a given oper-
ating system. On the one hand, it seems obvious to guarantee the integrity of
the digital market as a core platform service, but the obligation to use applica-
tions available in one shop only drastically limits the opportunities for inde-
pendent app providers to enter the market. This is especially true for small
companies that sometimes operate in a local market and the cost of entering a
single gatekeeper-managed shop platform may be too high. In such a situation,
large corporations enter this niche and are able to bear these costs and pass the
fees on to the cooperating entrepreneurs (e.g., a small restaurant versus a food
delivery company which delivers meals from many restaurants to consumers).
Mandatory obligations already include the prohibition to use non-public
data obtained by gatekeepers in connection with the relationship between
business users and consumers that was previously used for competitive advan-
tage. On the other hand, among the obligations requiring further discussion,
there is one considering the placing of consumer products on a fair and non-
preferential basis compared to other business operators. It was also stressed that
any search engine provider must be provided with access, on fair, reasonable,
and non-discriminatory terms, to placement, query, click, and impression data
relating to free and paid searches made by end users (subject to the anonymisa-
tion of personal data).
In these cases, reference can be made to the Commission’s decision on the
more favourable positioning and display by Google, in its general search results,
of pages of its own comparison shopping service compared to competing com-
parison shopping services ( European Commission, 2017c ). The idea is there-
fore that gatekeepers should not place their products on more favourable terms
than similar services or products offered by another third party. This require-
ment is difficult to meet for some gatekeepers who cannot easily separate their
individual activities from the core platform service and ensure, for example,
non-discriminatory billing.
A separate issue covered by this regulation (to be further specified) is the
possibility for business users and ancillary service providers to gain access to
interoperable operating system, hardware or software functions that remain at
gatekeepers’ disposal. It is therefore about the collection and monetisation of
data held that cannot be accessed by business partners operating on an online
platform. This is also the subject of the proceedings recently opened by the
European Commission, which intends to investigate whether this data gives
Facebook an undue competitive advantage in particular on the online classified
ads sector. The Commission has concerns that Facebook, by using data obtained
from social media activities, competes unfairly with players in neighbouring
markets where it is also an active player ( European Commission, 2021c ).
It is also worth noting that two principles have been adopted in the EU as
part of the overall digital market policy objective: general data portability and
data access interoperability. Firstly, gatekeepers should ensure the portability
of data generated in the course of a business user’s or end user’s activities.

Online platforms in the digital economy 29
Secondly, gatekeepers should ensure that business users are able to benefit from
free, real-time, continuous, high-quality access and use of data generated by
their activities on the online platform (this includes end user data). However,
both obligations have been categorised as requiring further specification.
Conclusions
The digitalisation of the economy has given rise to a digital marketplace that dif-
fers significantly in many elements from the traditional marketplace and offline
business models. This relatively new phenomenon escapes the scope of hith-
erto applicable regulations. Neither has it been reflected in the adaptation of the
European Single Market regulations in force to date. As a consequence, one can
observe increasing violations of competition rules in the EU digital market.
Under such circumstances, the Commission, which is responsible, among
other things, for enforcing compliance with the EU law, including preventing
the abuse of a dominant market position leading to the distortion of competi-
tion, initiated works on a new piece of EU law. The official aim of the pro-
posed Digital Market Act is to ensure competitive conditions in the European
Single Market for all companies. Digitisation and appropriate regulations in
this area became especially relevant during the COVID-19 pandemic as digi-
tisation emerged as a perfect solution to the pandemic situation (remote learn-
ing, working from home, online shopping, etc.) and at the same time became
one of the pillars of post-pandemic transformation in the EU (post-pandemic
EU economies are to be more competitive, thanks to digitisation).
When adopting new solutions in this area, decision-makers should act with a
lot of caution. Both the market, its participants, and their behaviour are new to
everyone. On the one hand, leaders are emerging who undoubtedly dominate
the market and are forerunners of digitalisation of social and economic life.
These companies develop online platforms, which are new markets connecting
business partners and consumers. On the other hand, changes in the behaviour
of market players are occurring very quickly. This is definitely different from the
offline economy, where all changes occur much more slowly and the existing
legislation seems to be optimal. Internet platforms and, above all, gatekeepers,
using access to the greatest value, that is, data of both consumers and business
partners, can steer a given market at will. Undoubtedly, this is the effect pro-
duced by their business models, but this does not mean that they should not be
regulated with a view to ensuring competition and consumer protection. Such
a situation and such behaviour are not observed in the offline reality.
Given the situation, it should come as no surprise that the European Com-
mission’s new approach is not so much to amend or adapt the existing legisla-
tion as to introduce a new one based on recent experience, as is the case with
the Digital Market Act. Moreover, this solution is ahead of the potential future
behaviour of big tech companies. The identification of gatekeepers should
ensure that new antitrust solutions do not affect the entire market, but only
precisely selected unfair behaviour of companies.

30 Adam A. Ambroziak
On the one hand, the approach proposed by the European Commission seems
to be optimal. EU legislation is not aimed at interfering in the digital infrastruc-
ture built by technology giants. Consequently, it should not define the markets
for their functioning, leaving both the scope and the directions of development
to independent business decisions. What the Digital Market Act should achieve
is only the ex ante elimination, compared to ex post effects, of situations where
the dominant position of entrepreneurs is abused. Furthermore, criteria should
be introduced to determine which behaviours of dominant companies in digi-
tal markets are uncompetitive and consequently unacceptable in the EU and
ultimately prohibited. The proposed criteria have been developed on the basis
of the experience of recent years and the antitrust cases of the European Court
of Justice. Thus, it seems that the EU approach is not so much to ban activities
in the EU as to discourage certain behaviour deemed to be uncompetitive. In
this way, legal space has been created, on the one hand, for the further develop-
ment of gatekeepers and, on the other hand, for business partners, including
small- and medium-sized enterprises (SMEs) from the EU, to cooperate with
them. Consequently, gatekeepers can develop new technologies, platforms, and
digital markets, while SMEs, also those from the EU, can use the infrastructure
thus built. This approach also provides some protection for consumers in the
digital market by, among other things, protecting their data from being used by
gatekeepers in unfair competition with other business users.
On the other hand, it is worth noting that amendments proposed by the
European Parliament and the Council make the rules more stringent. Politi-
cal acceptance and will to support such approach can be pretty easy to reach
in the EU, as all of the big five giant tech companies are not European (they
do not originate from the EU) and their main competitors are from China.
Nonetheless, identification of selected companies as gatekeepers in the digital
market is not extraordinary compared to offline reality. We can point out to
some examples of sectoral regulation based on the EU law, which introduced
special obligations on the big quasi-monopolistic and monopolistic companies.
As noted earlier, the obligations imposed on gatekeepers by the regulation
rely on the past practices of individual platforms offering selected services. It
means that the European Commission procedures were introduced against one
set of two elements: a given behaviour of a given company. Separate identifi-
cation of giant individual platforms as gatekeepers and then their problematic
behaviour, as proposed in the DMA, can be difficult to implement.
However, it is worth noting that the new rules can be recognised as a warning
to preventively deter online platforms from uncompetitive behaviour. Indeed,
it seems that this regulation can be read as a roadmap for technology giants
offering selected core platform services not to engage in certain activities. It
is true that often the specific behaviours listed in the regulation can with high
probability be attributed to the behaviours of specific companies, but this makes
the Digital Market Act all the more of a document setting out a descriptive
framework of acceptable behaviour from an antitrust perspective than a legal
act to punish unfair behaviour of giant techs. Therefore, further research will

Online platforms in the digital economy 31
definitely be needed into the economic and social consequences of the new
regulations, both the here discussed Digital Market Act and the Digital Service
Market, including the availability of new services, the degree of consumer pro-
tection, and the provision of fair B2B relationships on online platforms.
Note
1 Pursuant to the EU legislation ( Regulation, 2019 ), to be considered online intermedia-
tion services, services should:
• constitute information society services ( Directive, 2015 );
• allow business users to offer goods or services to consumers with a view to facilitating
the initiating of direct transactions, irrespective of where those transactions are ulti-
mately concluded;
• be provided to business users on the basis of contractual relationships between the pro-
vider of those services and business users which offer goods or services to consumers.
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