Summary of Commission Decision of 5 September 2023 relating to a decision pursuant to Article 3 of Regulation (EU) 2022/1925 (Cases DMA.100011 – Alphabet – OIS Verticals, DMA.100002 – Alphabet – OIS App stores, DMA. 100004 – Alphabet – Online search engines, DMA.100005 – Alphabet – Video sharing, DMA.100006 – Alphabet – Number-independent interpersonal communications services, DMA.100009 – Alphabet – Operating systems, DMA.100008 – Alphabet – Web browsers, DMA.100010 – Alphabet – Online advertising services) (notified under document number C(2023) 6101 final)
Date: 2023-09-05
Institutions: Directorate-General for Competition, European Commission
Subjects: advertising, browser, competition law, digital content, digital economy, digital single market, electronic commerce, online game, operating system, provision of services, search engine








C_202300549EN.000101.fmx.xml












Official Journal of the European Union


EN
Series C













C/2023/549


27.10.2023







            SUMMARY OF COMMISSION DECISION
         
of 5 September 2023
         
relating to a decision pursuant to Article 3 of Regulation (EU) 2022/1925
(Cases DMA.100011 – Alphabet – OIS Verticals, DMA.100002 – Alphabet – OIS App stores, DMA. 100004 – Alphabet – Online search engines, DMA.100005 – Alphabet – Video sharing, DMA.100006 – Alphabet – Number-independent interpersonal communications services, DMA.100009 – Alphabet – Operating systems, DMA.100008 – Alphabet – Web browsers, DMA.100010 – Alphabet – Online advertising services)


(notified under document number C(2023) 6101 final)


(Only the English text is authentic)
(C/2023/549)


On 5.9.2023, the Commission adopted a decision pursuant to Article 3 of Regulation (EU) 2022/1925 of the European Parliament and of the Council
          (1)
. In accordance with the provisions of Article 44 of Regulation (EU) 2022/1925, the Commission herewith publishes the names of the parties and the main content of the decision, having regard to the legitimate interest of undertakings in the protection of their business secrets.

1.   INTRODUCTION









(1)


The Designation Decision (‘the Decision’) is designating Alphabet as a gatekeeper pursuant to Article 3 of Regulation (EU) 2022/1925 (‘DMA’) in relation to a number of core platform services (‘CPSs’) that are provided by Alphabet and which, following the Commission’s analysis, individually constitute an important gateway for business users to reach end users as referred to in Article 3(1)(b) DMA.












(2)


Together with its notification, Alphabet submitted pursuant to Article 3(5) DMA a rebuttal request in relation to its number-independent interpersonal communication service (‘NIICS’), Gmail. The Commission accepts the rebuttal for Gmail, because the arguments presented by Alphabet not only manifestly call into question the presumption laid down in Article 3(2)(b) DMA but also demonstrate that the requirement laid down in Article 3(1)(b) DMA is not fulfilled; hence a market investigation was not necessary.




2.   PROCEDURE









(3)


On 3 July 2023, Alphabet notified the Commission, pursuant to Article 3(3) DMA, first subparagraph, that it meets the thresholds laid down in Article 3(2) of that Regulation in relation to the following CPSs: (i) its online intermediation services Google Shopping; (ii) its online intermediation services Google Play; (iii) its online intermediation services Google Maps; (iv) its online search engine Google Search; (v) its video-sharing platform service YouTube; (vi) its NIICS Gmail; (vii) its operating system Google Android; (viii) its web browser Google Chrome; and (ix) its online advertising services.












(4)


With its notification, Alphabet presented arguments seeking to demonstrate that although its NIICS Gmail meets all the thresholds in Article 3(2) DMA, it does not satisfy the requirements listed Article 3(1) DMA.












(5)


On 7 July 2023, the Commission sent Alphabet two requests for information pursuant to Article 21(2) DMA relating to its online advertising services and its video-sharing platform service YouTube. Alphabet replied to the requests for information on 12 and 27 July 2023 (online advertising services) and 14 July 2023 (YouTube).












(6)


On 13 July 2023, Alphabet submitted to the Commission a complementary letter with additional quantitative evidence on its NIICS Gmail to further support Alphabet’s rebuttal of this service.












(7)


On 27 July 2023, the Commission sent Alphabet a letter concerning Alphabet’s notification relating to the delineation of its video-sharing platform service YouTube, its operating system Google Android, its NIICS Gmail and its online advertising services. Alphabet replied to the Commission’s letter on 4 August 2023 and after the deadline set by the Commission, submitted a supplementary reply on 15 August 2023 (relating to online advertising services).




3.   LEGAL FRAMEWORK









(8)


The DMA establishes a set of narrowly defined objective criteria for qualifying a large online platform as a gatekeeper. Designation is to be made in relation to one or more CPSs provided by the undertaking that are an important gateway for business users to reach end users within the meaning of Article 3(1), point (b) DMA. In order to determine whether a service provided by an undertaking is a CPS that meets the requirement set out in Article 3(1), point (b) DMA, it is necessary, as a preliminary step, to qualify and delineate the respective service. A relevant criterion for qualifying and delineating CPSs is the purpose for which the service is used by either end users or business users or both.












(9)


According to Article 3(1) DMA, the Commission is to designate an undertaking as a gatekeeper if it fulfils three cumulative requirements, namely: (a) it has a significant impact on the internal market; (b) it provides a CPS which is an important gateway for business users to reach end users; and (c) it enjoys an entrenched and durable position, in its operations, or it is foreseeable that it will enjoy such a position in the near future. Article 3(2) DMA lays down a presumption that those requirements are satisfied where certain quantitative thresholds are met, in particular regarding the company’s turnover or market capitalisation as well as the numbers of end users and business users of a particular CPS in each of the last three financial years.












(10)


Pursuant to Article 3(5), first subparagraph DMA, an undertaking that meets all the thresholds laid down in Article 3(2) DMA may present, with its notification, arguments to demonstrate that, although it meets all those thresholds, it exceptionally does not satisfy the requirements laid down in Article 3(1) DMA due to the circumstances in which the relevant CPS operates. Article 3(5), second subparagraph, DMA provides that if the arguments submitted are not sufficiently substantiated because they do not manifestly call into question the presumptions set out in Article 3(2) DMA, the Commission may reject the arguments. By contrast, if the Commission considers that the submitted evidence is sufficient to demonstrate that the requirements laid down in Article 3(1) DMA are not fulfilled, it may accept the rebuttal with or without opening a market investigation pursuant to Article 17(3) DMA.




4.   THE COMMISSION’S ASSESSMENT









(11)


Following the notification by Alphabet the Decision establishes that the following services notified constitute CPSs pursuant to Article 2 DMA and are individually an important gateway for business users to reach end users as referred to in Article 3(1)(b) DMA:






a.


Alphabet’s online intermediation services Google Shopping;










b.


Alphabet’s online intermediation services Google Play;










c.


Alphabet’s online intermediation services Google Maps;










d.


Alphabet’s online search engine Google Search;










e.


Alphabet’s video-sharing platform service YouTube;










f.


Alphabet’s operating system Google Android;










g.


Alphabet’s web browser Google Chrome;










h.


Alphabet’s online advertising services.
















(12)


With respect to Alphabet’s operating system Google Android, the Commission designates Google Android and Alphabet’s related middleware (and in particular Google Play Services – not to be confused with the app store Google Play) as a single CPS insofar it contributes to controlling the basic functions of Google Android tablets and smartphones and to enabling software applications to run on them, thereby ensuring an effective functioning of Google Android.












(13)


With respect to Alphabet’s online advertising services, there was disagreement with Alphabet on three aspects of the delineation of that core platform service: (i) in relation to Google Analytics, (ii) in relation to AdSense for Search; and (iii) in relation to the boundary between the online advertising CPS and other Alphabet services.












(14)


Regarding (i) and (ii), the Commission considers Google Analytics, to the extent that it is used for advertising purposes, and AdSense for Search to be part of the Alphabet’s online advertising CPS, as opposed to what Alphabet argues. Regarding (iii), while Alphabet considers the display of an ad to be part of the service where the ad is exposed to the end user, the Decision finds the display of ads to be part of both Alphabet’s online advertising CPS and the service on which it is displayed. This is because the display of an ad as the culmination of the ad services value chain is a part of the online advertising CPS. However, that display on an end user-facing service is limited to the incident of exposing that ad on an online interface, whereas Alphabet understands the display of an ad as going beyond that communication act.












(15)


The Decision agrees with the delineation of Alphabet’s other CPSs.












(16)


The Commission accepts Alphabet’s rebuttal in relation to Gmail for the following reasons: (i) Alphabet has configured and provides Gmail based on open standards and in a standardized format, allowing Gmail users to effectively exchange messages with other users of Gmail and any other email service, which is further corroborated by the data provided by Alphabet ([90-100 %] of emails received by Gmail end users are sent by non-Gmail addresses); and (ii) because Alphabet, in the current configuration of Gmail, does not exert any control over the operations of Gmail end users or business users that would allow it to impose any significant degree of dependency between business users and end users. This shows that Gmail is not an important gateway in the sense of Article 3(1)(b) DMA.












(17)


The findings in the Decision are based on the information available to the Commission at the time of the Decision. Should there be any substantial change in any of the facts on which this Decision is based, or if this Decision is based on incomplete, incorrect or misleading information, the Commission may reconsider or amend the Decision pursuant to Article 4(1) DMA.




5.   CONCLUSION









(18)


For the reasons set out above, the Decision designates Alphabet as a gatekeeper in relation to (i) Alphabet’s online intermediation services Google Shopping; (ii) Alphabet’s online intermediation services Google Play; (iii) Alphabet’s online intermediation services Google Maps; (iv) Alphabet’s online search engine Google Search; (v) Alphabet’s video-sharing platform service YouTube; (vi) Alphabet’s operating system Google Android; (vii) Alphabet’s web browser Google Chrome; and (viii) Alphabet’s online advertising services.












(19)


The Decision accepts the rebuttal arguments raised by Alphabet in relation to its NIICS Gmail.






(1)  Regulation (EU) 2022/1925 of the European Parliament and of the Council of 14 September 2022 on contestable and fair markets in the digital sector and amending Directives (EU) 2019/1937 and (EU) 2020/1828 (Digital Markets Act) (OJ L 265, 12.10.2022, p. 1).


ELI: http://data.europa.eu/eli/C/2023/549/oj
ISSN 1977-091X (electronic edition)