Google may have to pay publishers for their content. Facebook might, too. WhatsApp could have to follow tougher telecom standards.
A new set of rules, expected to be unveiled by European Union officials on Wednesday, is likely to put new pressure on American tech companies.
Europe calls it consumer protection. Silicon Valley calls it protectionism.
In some ways, they are both right.
In a decade of sluggish growth, local lawmakers assert that these proposed changes will bring together the regionâs national economies into a so-called single digital market.
The aim? To give the blocâs roughly 500 million consumers unfettered access to services like movie streaming, online shopping and cloud computing, no matter where they live. At the same time, the proposals would force some of the worldâs largest tech companies to comply with stringent competition, privacy and copyright rules.
For many executives from American tech companies, such plans, which will still take years to come into effect and which will be subject to intense lobbying, feel like another round of protectionism. And while Europeâs policy makers balk at these claims, the fact that Google, Facebook and Microsoft, among others, will be the most affected by the digital revamp has again highlighted how much Europeans rely on American tech when using digital services in their daily lives.
The plans to be announced by the Brussels-based European Commission, the executive arm of the European Union, include:
â Potentially giving publishers the right to charge Google and other internet companies, if they so choose, when they use online content from newspapers or magazines on news aggregation websites, like Google News. Social media sites like Facebook and Twitter also could be affected. Similar rules have already been passed in Germany and Spain, but with little success.
â Placing greater scrutiny on internet phone and messaging services like Facebookâs WhatsApp, which may require them to comply with tougher telecommunications standards that now apply only to traditional text messaging and voice calls. Telecom groups say these new services are similar to text messages and so should be regulated under the same rules. The tech companies believe they provide a different option for consumers and should not be encumbered with outdated regulation.
The biggest American tech companies face intensifying scrutiny by European regulators, with â pressure that could potentially curb their sizable profits in the region and affect how they operate around the world.
â Giving European consumers the right to watch and buy some premium and online streaming content from across the bloc. Movie studios, sports rights holders and other broadcasters say the plans could reduce the value of their content, allowing people to buy services from the country that offers the lowest price.
â Providing financial incentives to telecom operators like Deutsche Telekom and Orange to invest in the regionâs mobile and broadband networks. Operators may be given greater control over their internet infrastructure, potentially restricting competitorsâ use of these networks. Companies say such limits are needed to guarantee a return on the billions of dollars of digital investment. Consumer groups argue that it may lead to higher prices.
Europeâs proposals, which could still be subject to last-minute changes before being published, were confirmed by six people with knowledge of the matter, who spoke on the condition of anonymity because the reforms had not yet been made public.
For their part, European policy makers say they are only following the regionâs stringent laws aimed at protecting peopleâs rights in an increasingly digital world and are not specifically targeting American tech giants.
But with things like Europeâs record $ 14.5 billion claim against Apple for unpaid taxes and a series of antitrust charges against Google, the European Union has become a thorn in the side of many of the worldâs largest companies, requiring them either to alter how they offer online services worldwide or fight protracted legal battles to fend off the Continentâs regulators.
âItâs a fact of life that most innovative companies come from the West Coast,â said Andrej Savin, an internet governance professor at the Copenhagen Business School. âThe proposals coming from Brussels definitely have the American companies in mind.â
Europe has long fought to reduce this reliance on West Coast tech companies, but even homegrown success stories like Spotify, the Swedish music-streaming service now valued at more than $ 8 billion, became a worldwide hit mostly through its expansion to the United States.
In part, Europe has failed to compete successfully with the United States because Europeans canât get enough of using American digital products and services, often relying on them at a higher rate than their American counterparts.
With a roughly 90 percent market share, Googleâs search engine in Europe is more dominant than it is in the United States, where Microsoftâs Bing service still holds its own. Facebook has more European users than American ones, while Germany and Britain remain two of Amazonâs largest international markets.
The latest digital reforms â either on purpose or by coincidence, depending on peopleâs viewpoints â take aim at that dominance, and potentially give European publishers and telecom companies a helping hand to compete head-on with their American rivals.