European Union antitrust regulators warned Apple on Thursday that it could face heavy fines if it doesn't open up its closely guarded software to rivals.
The European Commission has launched a so-called specification procedure to specify what Apple must do to comply with the Digital Markets Act (DMA), a tough new law aimed at preventing tech giants from abusing their market share.
The move is not a formal investigation, but the increased enforcement could target iOS connectivity features on smartwatches, headphones, virtual reality headsets and other internet-connected devices, upending Apple's lucrative business model.
The Brussels-based regulator is expected to specify how Apple will provide effective interoperability when it comes to features such as notifications, device pairing and connectivity.
The second procedure concerns how Apple will handle interoperability requests submitted by iOS and iPadOS developers and third parties, and requires the company to ensure a transparent, timely and fair process.
If Apple doesn't comply within six months, the EU could start imposing fines.
The DMA states that technology companies that don't comply with the law risk fines equal to 10% of their annual global revenue.
Apple earned a total of $383.93 billion in revenue in Europe last year. The Cupertino, California-based giant faces paying more than $38 billion if it fails to meet regulators' demands.
“Today marks the first time that we are using the DMA-based specification procedure to guide Apple through a constructive dialogue to effectively comply with its interoperability obligations,” EU Executive Vice-President Margrethe Vestager said in a statement.
“We are committed to ensuring fair and open digital markets. Effective interoperability between smartphones and their operating systems, for example, plays a key role in this,” Vestager added.
Apple has steadfastly refused to allow competitors to peek at the iOS source code, which gives the company control over the development, distribution and licensing of the software that enables its devices to run.
Developers who want to deploy apps to Apple devices must use tools provided by Apple such as Xcode and Swift, but must follow Apple's guidelines.
Apple said it would continue to work constructively with the European Commission, but also warned of risks.
“Weakening the protections we have built over time puts European consumers at risk and gives bad actors more ways to access their devices and data,” the company said in a statement.
The Post has reached out to Apple for comment.
Earlier this month, Apple released the new iPhone 16 with the latest version of iOS, which includes a suite of highly praised artificial intelligence technologies.
However, Apple said it would not release certain features in the EU, including Apple Intelligence, iPhone Mirroring and SharePlay Screen Sharing, due to DMA requirements for its operating system to work with third-party apps.
The tech giants that the DMA calls “gatekeepers” – Apple, Google, Amazon, Facebook and Microsoft – are facing a crackdown in the EU for alleged anti-competitive behaviour.
In March, the EU fined Apple nearly $2 billion for restricting competition by banning developers from directing users to alternative payment options outside the App Store.
Earlier this year, Meta, the parent company of Facebook and Instagram, was accused of violating the DMA by failing to give users the option to protect their personal data from advertisers.
