With dueling approaches, the US and EU hit the tech giants hard

On Friday, the U.S. Department of Justice made its final pitch in court that Google is an illegal monopoly in the lucrative online search market, the backbone of the $2 trillion company.

Across the Atlantic, the European Commission is investigating whether Google is violating the Digital Markets Act, a new law to prevent any single platform from gaining too much control over the online landscape.

The two governments have more than Google in their sights: They’re both now in a full-bore effort to rein in its rival digital giants Apple, Amazon, Microsoft and Meta as well.

After two decades of nearly unrestricted, unregulated growth, the world’s largest tech platforms are now under active legal attack by governments on both continents at once. The Justice Department’s March suit against Apple officially put the U.S. in court against all five of the biggest online platforms. The EU launched enforcement of its sweeping new digital antitrust law on March 7, promptly naming Google, Apple and Meta as targets under investigation.

For both the industry and the regulators who have been waiting years to see the tech industry face this level of scrutiny, it marks a crucial moment — and a potential pivot in the power relationship between Western democracies and tech firms.

But the bureaucratic pace and approach of the West’s regulators is raising the question of whether Brussels and Washington can move fast enough, and with enough force, to truly reshape some of the world’s largest and most dominant companies.

“We don't have a lot of time,” said outgoing EU competition chief Margrethe Vestager at a conference in Washington last month.

In the U.S., the coming election could reset Washington’s priorities before any of the cases are resolved. In the EU, the strictest enforcement mechanisms could take years — long enough for the companies themselves to adapt and evade meaningful restrictions.

The West’s two largest markets are taking dueling approaches. The EU is now enforcing a sweeping new digital antitrust law it passed in 2022. The U.S., with no new laws on the books, is targeting the largest companies individually with lawsuits by the Federal Trade Commission and the Department of Justice.

The two tacks are splitting the companies’ attention, miring them in separate legal and enforcement battles — and the firms, used to years of a light hand and encouraging policies, are crying foul.

“These are two diametrically opposed processes afoot,” said Matthew Schruers, president and CEO of the Computer and Communications Industry Association, a trade group representing Amazon, Apple, Google and Meta, referring to the different strategies of U.S. and EU regulators.

He argued that the sudden, differing transatlantic demands impose “a considerable burden on businesses.”

Beneath the movement runs a growing belief among policymakers that tech giants amount to a new kind of monopoly that requires a new approach to antitrust law. Regulators on both sides of the Atlantic talk frequently, meeting in conferences held both in Brussels and the U.S. Their philosophies are largely aligned, but their tools are shaped by divergent national politics.

The EU’s Digital Markets Act aims to change the tech giants’ behavior by law, after antitrust probes that levied heavy fines, including more than $8 billion for Google, failed to do so. It covers “gatekeeper” companies with more than 45 million European users — which so far means only the five American giants plus TikTok owner ByteDance. (Potentially X and Booking.com could join the list soon.) Full enforcement began March 7.

The law also carries a threat to split up repeat offenders, companies that have been found not to comply with the law three times in eight years. Google, Apple and Meta are already being probed for non-compliance.

The U.S. has no such law, after federal antitrust bills on tech failed to reach a Senate vote in 2022. The ball is instead being carried by newly activist federal agencies, the FTC and DOJ, each suing companies individually under century-old antitrust laws. (The only company directly targeted by a U.S. law is the Beijing-based ByteDance, which is being hit with a federal law that forces it to sell its prize app, TikTok.)

Break-ups are also on the menu of possible remedies in the U.S. In a second case targeting Google’s ad tech business, the DOJ is specifically asking to unwind past acquisitions, including the 2008 deal for Doubleclick, now the centerpiece of the company’s ad business. The FTC wants to break up Meta.

The companies say they are complying. In Europe, where the DMA went into full force in March, platform companies have already begun to adapt to the EU’s demands, sometimes very grudgingly changing their features and business strategies. Those changes aim to get smaller rivals to also offer their services to customers on Big Tech platforms.

Smaller tech companies have made pointed arguments that the big platforms are complying in a way that violates the spirit of the law. Apple, for instance, is required to loosen control over the App Store by allowing competing stores, but critics say its rules and fees still make it hard for rivals to gain traction (though more concessions are trickling in). Apple foe Tim Sweeney of Epic Games referred to Apple’s behavior as “malicious compliance.”

Google antagonist Yelp says Google’s changes — including a revamp of its search results pages — actually “exacerbate” the problem of the search giant favoring its own services over the competition.

Some companies have begun to warn European regulators that their approach could create risks and worsen the tech firms’ services.

Nick Clegg, the former British politician who now serves as Meta’s president of global affairs, told POLITICO he expects “there will be some innovations which will roll out more slowly or not at all in the European Union. But that… is a tradeoff which [European regulators] have chosen.” One case in point: Meta dragged its heels in releasing Threads, its new social media platform, in Europe compared to elsewhere.

In the U.S., companies are standing pat and taking a fight-it-out strategy, girding for legal battles that could last for years.

Most recently, the Department of Justice sued Apple last month, and is pursuing a second case against Google heading to trial in September. The Federal Trade Commission last year sued Amazon; its case to break up Meta was filed during the end of the Trump Administration. The other global tech giant, Microsoft, evaded an antitrust punch last year when it defeated a Federal Trade Commission challenge to its takeover of Activision, a gaming giant. The FTC is appealing.

But U.S. enforcers are subject to years-long court proceedings and idiosyncratic judges, many of whom are skeptical that Big Tech has harmed consumers as much as monopolies of prior generations.

The newly aggressive stateside approach is still untested, said a U.S. enforcer.

The two-front transatlantic fight against the campaign is already stretching regulators thin on both continents, as they try to grapple with companies far larger and richer than the agencies trying to control them .

But current and former regulators in both governments say they hope Washington and Brussels’ effort may also act as a forcing mechanism for the companies to alter their alleged anti-competitive ways.

“Companies need to worry about how their compliance issues in Europe will appear to judges in the U.S.,” said Gene Kimmelman , a DOJ antitrust lawyer in the Obama and Biden Administrations, now a fellow at Yale’s Thurman Arnold Project. “If they are stonewalling, it could come back to bite them in the U.S. cases.”

The approach still has many uncertainties. Europe’s law is new and largely untested as an enforcement mechanism. Lawsuits in the U.S. require years-long court proceedings and are subject to idiosyncratic judges, many of whom are skeptical that Big Tech has harmed consumers as much as monopolies of prior generations.

Kimmelman, who has advocated in favor of the DMA, says the regime is still new, and expects Washington and Brussels to find ways to bridge the emerging enforcement gaps.

“I think you will see the two work synergistically to force changes to business practice,” he said.

This could take some time. It’s no simple task reconciling two regulators when they have different priorities, said Anu Bradford, a law professor at Columbia University and author who coined the expression "Brussels effect.”

The Finnish academic argues U.S. officials have “a greater incentive to work with Europeans” than before. Public opinion is shifting, she said, “so they actually have the legitimacy, the support of the public to go up with these tech companies.”

Those on the government side, least, say that this is likely to be the new normal for the tech industry — one where companies need to defend themselves on two fronts, with risks if they try to dodge rules on either side.

“It’s a one-way ratchet,” said Kimmelman. “We’re not going back.”

Mohar Chatterjee and Rebecca Kern of the POLITICO staff contributed to this report.