Post-Breton EC decides not to designate X as a gatekeeper under the DMA

A big part of the Digital Markets Act is to identify those digital platforms that have the greatest impact on markets and constrain their most oligopolistic behaviour. As you can see from the diagram below, Alphabet (Google) has its fingers in the most digital pies but six other companies are deemed to own platforms that act as digital gatekeepers.

Despite being one of the world’s most used social media platforms X, formerly known as Twitter, has been found to fall short of the level of market-distorting influence required for a gatekeeper designation after a months-long investigation. Specifically the EC says that ‘even if X is deemed to meet the quantitative thresholds set out in the DMA… X is not an important gateway for business users to reach end users.’

Part of the reason for this could be the exodus of corporate advertisers that took place since Elon Musk acquired the platform, with many of them apparently scared off by his commitment to freedom of speech. Whatever the cause, there just isn’t enough commercial activity taking place on X to make the EC inclined to pay it special attention.

One person who is likely to be viewing this decision with pursed lips is Thierry Breton, the former champion of digital enforcement at the EC who was surprisingly shown the door a month ago. There was speculation at the time that one reason for his defenestration was his freelance aggression towards X and Musk, which the latter responded to in idiosyncratic style. You have to wonder if this decision would have been made were Breton still in place.

“The Commission will continue to monitor the developments on the market with respect to this service, should any substantial changes arise,” concludes the EC decision. This would appear to present X with a dilemma as, if its commercial fortunes improve, it could end up being big enough be designated a gatekeeper, which it presumably doesn’t want. We imagine Musk and co will be doing everything they can to find out as precisely as possible where that threshold lies.