Elon Musk’s X Won’t Be Regulated Under the European Union’s Digital Markets Act (DMA)
The European Commission has made a decision that will come as a relief to Elon Musk, the CEO of Twitter, now rebranded as X. The social media platform has been exempted from being regulated under the EU’s Digital Markets Act (DMA), despite hitting usage thresholds earlier this year.
What is the Digital Markets Act?
The DMA is a pan-EU regime that targets Big Tech with up-front rules aimed at ensuring fairer dealing with individual and business users. The regulation specifically focuses on companies that have significant market power, often referred to as "gatekeepers." These gatekeepers are responsible for providing essential services to businesses and individuals, such as social media platforms like Meta, TikTok, and now Twitter (X).
Why was X excluded from the DMA?
The Commission’s decision not to include X in the list of gatekeepers under the DMA may come as a blow to Musk’s ego. According to the EU, X does not qualify as a gatekeeper because it is not an important gateway for businesses to reach consumers. This means that the platform will not be subject to the DMA’s operational "dos and don’ts" in areas like third-party data use and user consent for tracking ads.
What are the implications of this decision?
While X may breathe a sigh of relief at avoiding the regulatory risk associated with being a gatekeeper, it is essential to note that regional compliance issues still loom on the horizon. Under the Digital Services Act (DSA), a sister regulation to the DMA, X will need to comply with general governance rules and additional requirements related to algorithmic transparency and accountability.
Regional Compliance Issues Ahead
The Commission’s suspicions about X’s DSA breaches have already led to several ongoing investigations that could result in penalties of up to 6% of its global annual turnover. Musk’s tendency to insult public officials may come back to haunt him in the EU, where regulatory bodies are scrutinizing his company’s compliance with regional regulations.
A Different Perspective
The EU’s decision not to designate X as a gatekeeper can be seen from a different angle. The Commission has effectively acknowledged that most of X’s ads are for dubious-looking products or services, such as earwax cleaners or polyester rugs. This assessment may sting Musk’s ego, but it also highlights the platform’s limited relevance in the EU market.
The Future of Regional Compliance
While X may have dodged the regulatory bullet with the DMA, regional compliance issues will continue to be a challenge for the company. As the Commission continues to monitor developments in X’s market position, it is essential that Musk and his team prioritize compliance with regional regulations to avoid further scrutiny and potential penalties.
Conclusion
Elon Musk’s X has been given a reprieve from regulatory scrutiny under the EU’s Digital Markets Act (DMA). However, regional compliance issues still loom on the horizon. With ongoing investigations into DSA breaches and potential penalties in the pipeline, it is essential that X prioritizes compliance with regional regulations to avoid further controversy and reputational damage.
Related Articles
- New ship, new year: SpaceX to deploy model Starlink satellites on next Starship launch
- Uber CEO Dara Khosrowshahi resigns from self-driving truck startup Aurora’s board
- Scout Motors EVs will have satellite connectivity
Subscribe for the Industry’s Biggest Tech News
Stay up-to-date with the latest developments in the tech industry by subscribing to our daily news, AI, and space newsletters. By submitting your email address, you agree to our Terms and Privacy Notice.
Get the best of TechCrunch’s coverage delivered weekly
Join the Conversation
Stay informed about the latest news and developments in the tech industry by following us on social media platforms like Twitter and LinkedIn. Join the conversation with fellow industry professionals and stay ahead of the curve.
Subscribe to our daily news, AI, and space newsletters
Learn More
- What is the Digital Markets Act?
- Why was X excluded from the DMA?
- What are the implications of this decision?
- Regional Compliance Issues Ahead
- A Different Perspective
- The Future of Regional Compliance
- Conclusion
