U.S. Tech Companies Retaliate against Stringent EU Policies

The European Union has targeted apps originating out of the United States, imposing strict rules against them. The U.S. Tech companies who own these apps have retaliated back and have accused the EU of impeding on creative licenses.

U.S. Tech Companies Retaliate against Stringent EU Policies
EU tech policies have caused U.S. companies to fight back

The European Union has taken it upon themselves to re-write the rules of the internet. As a result, U.S. Tech companies are facing tremendous hit as their apps are at the forefront of the EU’s target. While these apps have virtually no restriction in the U.S. and in the majority of the world, the EU has set out rules of its own that not only undermines the business model of these companies but also impedes on their creative licenses. In a tit-for-tat exchange, now these Tech giants are setting up new laws that would make accessing these apps more expensive in the EU.

At the forefront of the tirade, is none other than the video content website Netflix. Earlier, EU demanded that Netflix should devote a minimum of 30% of their catalog to European Works, in an attempt to promote regional content rather than the majority of Hollywood orientated movies and TV shows that dominate Netflix. While Netflix acknowledged that catering to a specific audience encouraged more regional original programming for international audiences, enforcing such quotas would have unwarranted negative impacts, like marginally reducing member satisfaction. It could also negatively impact both the customer experience and creativity.

Netflix CEO Reed Hastings has criticized the ruling, stating that EU is “currently rewriting its audiovisual rules.” He has said that “Netflix believes a more effective way for a country to support strong local content is to directly incentivize local content creators, independent of the distribution channel.”

At the other end of the spectrum is Tech giant Google. Earlier, Google was charged $5 billion antitrust fine by the EU for abusing the dominance of its Android mobile operating system. In return, Google has now reverted to under-the-belt strategies that aim to make a profit out of the plethora of apps that it owns. Google’s apps are usually free and come pre-installed in Android Operating System. Now, it will charge phone makers a licensing fee that wants to pre-install such apps on smartphones.

The biggest discrepancy comes while using the Google search as a default search engine. EU established that Google shouldn’t force Google search upon users as it undermines the search engines of other companies. Thus, Google has responded by unbundling the 11 apps that come together pre-installed on phones. Now separate apps will have an individual licensing fee if a phone maker wishes to install it on the phone. The pressure is now on EU phone-makers to include Google’s apps on smartphones. Failing to do so might not just hamper their sales but also devalue their brand in the long run.

While many security agencies around the world have lauded EU’s General Data Protection Regulation (GDPR), they have also criticized their control to take over creative freedom. While GDPR effectively protects the user’s data from being used by third-party appliances, knowingly or unknowingly, the laws against Netflix content and Google’s antitrust fine has been seen as a step too far. It’s no wonder that these tech companies are fighting back in their own ways so that their applications could be accessed in the same way as by users around the world.