Market Share Only 4% but Subject to Regulation?…Controversy Over EU Digital Law Targeting Samsung

As Samsung Electronics faces the possibility of being included in the European Union (EU)'s 'Digital Markets Act (DMA)' regulatory list aimed at limiting the market dominance of global big tech companies, controversy is growing over the appropriateness of the regulation. This is because the regulation is focusing solely on company size without considering the services provided or market share.

On the 11th, the EU Commission began an internal evaluation of the major platform service reports submitted by global big tech companies, aiming to finalize the gatekeeper list under the DMA by September 6. The DMA is a law that regulates big tech companies acting as gatekeepers between consumers and sellers on platforms to prevent abuse of market dominance.

The EU Commission announced the criteria for DMA regulation, such as revenue and user scale. Companies including Samsung Electronics, Alphabet (Google), Amazon, Apple, ByteDance, Meta, and Microsoft (MS) were judged to meet the criteria. Among them, Samsung Electronics was considered to meet the gatekeeper criteria based on its proprietary web browser service 'Samsung Internet' installed on Samsung devices. It was deemed to meet the gatekeeper standards by operating in more than three countries in Europe and generating annual revenue exceeding 7.5 billion euros.

There is controversy over the appropriateness of including Samsung Electronics in the regulatory target. This is because its core business is device manufacturing, not software, and Samsung Internet's market share is significantly lower compared to other competing browsers. According to analysis data from market research firm StatCounter, as of last month, Samsung Internet's market share on smartphones was 4.3%. This is low compared to Google's Chrome (64.82%) and Safari, which comes pre-installed on iPhones (24.83%). When expanding the scope to all platforms including desktops and tablets, Samsung Internet's market share drops to 2.4%. Its ranking also falls to fifth place, behind Microsoft Edge, Opera, and Firefox.

Companies designated as gatekeepers may face fines of up to 10% of their total annual revenue for non-compliance with obligations. If repeated violations are confirmed, fines can be increased up to 20%. Considering Samsung Electronics' performance, if designated as a gatekeeper, it could face fines up to 30 trillion won. This means being labeled as a monopolistic company with only a 2-4% market share and paying astronomical fines.

Experts have also expressed concerns about the DMA. They argue that regulating solely based on size could cause significant side effects. At the 'International Seminar on Online Platform Regulation Trends' held on the 10th at the COEX conference room by the Korea Internet Corporations Association, Professor Joseph Colangelo of Basilicata University in Italy said, "Defining gatekeepers based on quantitative criteria can lead to unexpected results like in Samsung's case," and added, "There are some conflicting parts between competition laws in Germany or Italy and the DMA, causing confusion among businesses." Professor Christopher Yoo of the University of Pennsylvania pointed out, "If companies consider the possibility of competition law lawsuits when conducting business, the cost of service provision increases," and "This will result in reduced corporate innovation and consumer welfare."

Robert Atkinson, chairman of the U.S. Information Technology & Innovation Foundation, also emphasized that regulations like the DMA could actually restrict competition. For example, platform operators' payment services such as Apple Pay lower fees and expand consumer choice. However, the EU judged Apple to have violated antitrust laws by favoring its own payment method and blocking competing services. In this case, Atkinson argues that platform operators would be reluctant to compete with financial institutions.

This content was produced with the assistance of AI translation services.