EU Telling Apple How to Open Its Devices Up to Competitors

Report from The Hill

In Brief – Continuing a process started last September, the European Commission has formally directed Apple to implement specific changes to its iPhone and iPad operating systems to make it easier for the devices and services of competitors to work with Apple devices. The Commission exercised its authority under the EU Digital Markets Act to enact two “specification decisions” directing Apple to take specific actions to meet the law’s requirements. The first set of mandates is intended to improve the interoperability of connected devices, such as smartwatches, headphones and televisions, with iPhones, including pairing and notifications. The second set directs Apple on how to set up a process to address requests submitted by third-party app developers for iOS and IPadOS so that they have an effective and predictable path to work with the digital giant on interoperability concerns. The two specification decisions represent the first effort by the commission to compel one of the digital giants to make specific technical changes to their services to comply with their gatekeeper law. The demands are legally binding, and Apple is required to implement the specified measures on specific timetables. The Commission notes that Apple retains its right to challenge the orders, which are subject to independent judicial scrutiny.

Context – There are now 7 DMA gatekeepers operating 24 “core platform services” that must comply with 18 general regulatory mandates, including interoperability. The DMA challenges Apple’s core user proposition more than the others. Rather than using technical or non-transparent practices to shape its platforms, Apple built an openly restrictive “walled garden” with a value proposition that the platform was better at promoting privacy, security, and a consistent user experience. And their devices have been very popular with users. The EU is basically telling them that their model is not legal. The Commission also determined last summer that Apple’s App Store rules and fees likely violate the DMA as well. That decision is expected to result in fines and further demands very soon.

X Files Suit Against Indian Government Alleging Illegal Censorship Regime

Report from India Today

In Brief – X has sued the Indian government in the Karnataka High Court alleging that it is using Section 79(3)(b) of India’s Information Technology (IT) Act to illegally censor content on the platform. X argues that the government is using Sec. 79’s safe harbor procedure to bypass the proper legal processes for online content takedown requests that are outlined in Section 69A of the act. Those processes were upheld by India’s Supreme Court in 2015 and require a structured review of takedown orders. X argues that Section 79 lacks safeguards, raising censorship concerns. The company also says it is resisting government pressure to join Sahyog, a portal under the Indian Cyber Crime Coordination Centre (I4C) for managing online takedown orders.

Context – Elon Musk’s robust defense of “free speech” and long-standing criticism of social media content moderation practices that he decried as “woke” have upset many progressives and delighted many conservatives. And that was before the richest man in the world became a leading conservative political activist in many global markets. When it came to content moderation, he also often said that X would follow “local laws”. In the US, that foundation is built on the First Amendment. In countries like India and Turkey, social media platforms can be ordered to take down posts criticizing the government. The EU is using its Digital Services Act to regulate content moderation by X, and they may soon fine the company and Musk himself, a standoff that is likely to pull in the Trump Administration. Beyond Europe, X prevailed last year in a court standoff with Australia’s online safety regulator over an attempt to block a violent video outside the country, while Brazil’s highest court prevailed in a months-long battle with X and Musk to force several Brazilian conservative activists off the platform. Given Musk’s major business interests in the Indian market, many have been surprised that the company has been willing to challenge the government in recent years, especially when the other US tech giants haven’t.

Stakeholder Groups Criticize Latest AI Code of Practice Draft

Report from Euro News

In Brief – The leaders of the European Commission’s Expert Groups on the Code of Practice on General-Purpose Artificial Intelligence (GPAI) have released their third draft and received criticism from across the spectrum of stakeholder groups. The codes are intended to provide developers of the most powerful AI models with guidance on how to comply with the AI Act on issues including system transparency, risk assessments, and duties related to the use of copyrighted material for AI training. Technology industry representatives argue that the latest draft imposes excessive burdens beyond the original AI Act’s scope and could stifle innovation, particularly with ongoing third-party risk assessments, model transparency, and copyright obligations. The copyright recommendations are equally controversial among rights holders, with many claiming that they fail to adequately protect copyrighted content and will allow AI developers to rely of claims of vague “best efforts” as they violate copyright law. European Parliamentarians are also independently taking up their own review of AI-related copyright issues. The latest expert group draft will remain open for feedback until 30 March, with a final version expected in May.

Context – The AI Act was initially designed as a tiered risk-based regulatory regime for applications using AI technology, not an attempt to regulate AI technology itself. But EU Parliament changed course and chose to regulate large “foundation models”. This shift was divisive and EU-based AI innovators pushed for lesser mandates on developers of smaller models. The AI Act enacted into law is the most aggressive effort to regulate AI, but that is not without risk for the EU. The US, UK, and Japan have since shifted their AI policies in a deregulatory direction to promote investment and innovation. Some EU leaders are taking notice and counseling moderation. At the recent Paris AI summit, French President Macron called for the EU to “resynchronize with the rest of the world" and Commissioner Henna Virkkunen said that the Commission will be business-friendly in implementing its new rules.

Apple Barred from Participating in Google Search Antitrust Remedies Phase

Report from Ars Technica

In Brief – A panel of the DC Circuit Court of Appeals has reaffirmed the decision of District Court Judge Amit Mehta that Apple is not be able to directly participate in the upcoming remedies phase of the Google search monopoly trial to protect their interests, in particular the highly lucrative agreement with Google that pays Apple $20 billion to be the default search provider on Apple devices. The appellate court ruled that Apple waited too long to seek to intervene in the case. Last August, Judge Mehta sided with the US Department of Justice (DoJ) and ruled that Google held a monopoly in the market for general internet search and engaged in illegal conduct to maintain that search monopoly, especially through large payments to Apple and Samsung to make its search engine the default option on smartphones and browsers. Last fall, the DoJ asked for very aggressive conduct remedies including forcing Google to spin off its Chrome browser, and that recommendation was largely reiterated by the Trump Administration’s DoJ in early March. Google calls it a "wildly overbroad proposal” that goes “miles beyond the Court’s decision" and submitted an offer that would prohibit it from engaging in the conduct Mehta ruled illegally protected Google search from potential competitors, putting the payments to Apple clearly on the chopping block. Mehta is allowing Apple to submit written testimony and friend-of-the-court briefs.

Context – If Judge Mehta proposes to break up Google, it will be the most aggressive US effort to rein in a tech giant since the DoJ attempt to break up Microsoft in 2000. It would be even more striking given Mehta’s relatively narrow findings of illegality and harm. Although Google officials must have taken heart last October when Trump expressed reticence about breaking up the company, it’s been all bad news since. EU officials defending their Digital Markets Act are taking notes to remind everyone that they are not alone calling for big changes in Big Tech operations. Finally, the search giant is hoping that Mehta considers that Judge Thomas Penfield Jackson’s order breaking up Microsoft was overturned on appeal.