This move comes after the European Commission launched an antitrust investigation into Apple’s practices surrounding Apple Pay, suspecting that the company was unfairly restricting access to key technology to maintain its dominance in the mobile payment market.The Commission’s probe stemmed from concerns that Apple’s decision to limit NFC usage on iPhones to Apple Pay alone could stifle competition and prevent other companies from developing their own mobile payment solutions.
Apple’s proposed solution, if accepted by the Commission, could bring an end to the investigation and potentially save the company from significant financial penalties. However, the Commission will need to consult with Apple’s rivals and customers before making a final decision.
Despite not holding the majority share of smartphone sales or being the dominant mobile payment service in the EU, Apple Pay has gained significant traction, with over 2,500 banks and more than 250 fintech and challenger banks across Europe using the service.
Apple’s efforts to address the EU’s concerns come amidst a broader crackdown on the company’s business practices. The EU recently labeled Apple as a “gatekeeper” under the Digital Markets Act (DMA), which empowers the Commission to regulate big tech firms that hold dominant positions in the digital market.
Earlier this year, Apple acknowledged the possibility of third-party app stores on iPhones but later challenged the EU’s ruling mandating rival app stores. Additionally, it has appealed the inclusion of iMessage in the DMA’s gatekeeper designation, arguing that iMessage’s market share in Europe is too small to warrant regulatory scrutiny, which actually might turn out to be true.
As Apple navigates these regulatory challenges, it’s clear that the company is facing increasing pressure to address concerns about its competitive practices in the EU. The proposed NFC access could be a step in the right direction. However, it remains to be seen whether it will be enough to appease the Commission and avoid further regulatory scrutiny.
