Three Months After the Digital Markets Act Compliance Day: What's New?

Disclaimer: This blog provides a high-level overview of the EU Digital Markets Act. It does not constitute legal advice.

The EU's Digital Markets Act (DMA) is a piece of competition legislation passed by the European Union (EU) to foster equitable and fair digital markets. In essence, it aims to regulate the power of major tech companies, known as "gatekeepers," which wield substantial influence due to their extensive user base and market capitalization. The six initially designated gatekeepers were Alphabet/Google, Amazon, Apple, ByteDance, Meta, and Microsoft. The DMA aims to prevent these gatekeepers from imposing unfair conditions and to promote the openness of important digital services.

The DMA has now been fully in effect for three months (as of the time of writing). On March 6, 2024, referred to by some as the "DMA compliance day," a six-month transition period expired following the initial gatekeeper designations by the European Commission (the "Commission") on September 6, 2023. During this six-month period, each of the six initially designated gatekeepers, spanning 22 key digital services, had to comply with the relevant do's and don'ts of the DMA. Notably, Alphabet/Google was designated as a gatekeeper for search, which is of particular importance for Yext and our customers.

Below, we'll explain what you need to know now that the DMA has been fully in effect for three months. We'll cover enforcement activities, early data trends – focusing on search – and how Yext can help brands adapt to this new landscape.

Between the beginning of March 2024 and the date of this writing, the Commission has been busy enforcing the DMA:

• March 1, 2024: The Commission received notifications from Booking, ByteDance, and X regarding their services potentially meeting DMA thresholds.

• March 25, 2024: The Commission opened five non-compliance proceedings against Alphabet/Google, Apple, and Meta, including one against Google for possible self-preferencing in search results. The Commission is examining whether Google's compliance measures are sufficient or if they continue to prioritize their own products, like Google Shopping and Google Hotels, to the detriment of competitors. This scrutiny could lead to changes in how search results are displayed. The Commission has 12 months to conclude these proceedings.

• April 29, 2024: Apple was designated by the Commission as a gatekeeper for iPadOS.

• May 13, 2024: Booking was designated as a gatekeeper for its online intermediation service, Booking.com. Additionally, the Commission opened a market investigation into X's arguments against its gatekeeper designation.

If there was ever any doubt, these last months show that, based on its level of activity, the Commission is not just watching, but is taking action to enforce the DMA. The Commission's active stance on enforcement indicates more changes are likely, particularly regarding search.

For our analysis, we dove into the dynamics of first-party versus third-party traffic before and after March 2024, the month of the DMA compliance day. We compared traffic patterns between two data sets:

1. Google Listings website traffic (a Google-owned product powered by customer data) and

2. Organic traffic on Google from Location Pages (results outside of the Google-owned Local Pack, but powered by the same customer data).

This analysis spanned over one year. It included data from both within and outside of the countries where the DMA applies, which encompass the 30 countries within the EU and the European Economic Area (or EEA) (the "DMA countries").

Two key trends emerged when analyzing the initial data from March and April 2024 ("Post-DMA"). First, compared to gatekeeper-owned endpoints, non-gatekeeper-owned endpoints seem to be gaining more visibility in search results. Secondly, despite this shift in search results, there hasn't been a significant change in user behavior towards non-gatekeeper search engines.

1. Non-gatekeeper vs. gatekeeper-owned endpoints: Comparing January and February 2024 data ("Pre-DMA") and Post-DMA data, Yext observed a significant increase in engagement with non-Google-owned properties in search results within DMA countries. Engagement share for these properties rose from 138% to 163% year-over-year, a 25% jump. This jump indicates a potential shift in user behavior or search result prioritization in line with expectations created by the DMA. Essentially, the DMA looks to be doing what it promised: fostering competition and leveling the playing field between larger and smaller tech entities (to some degree).

Let us now consider the findings from countries outside of the EU and the EEA ("non-DMA countries"). This increase was 8.7% in non-DMA countries, suggesting a more pronounced effect in DMA countries. So, while the world may be seeing a shift, the DMA countries have grown about 16% faster.

While the implications of these trends are still unfolding, they suggest a broader shift in search result dynamics. This shift may be influenced by the regulatory changes introduced by the DMA.

2. Shift in search engine preferences: Leveraging our extensive publisher network at Yext, we tracked the share of traffic directed to non-gatekeeper search engines. Conducting a similar analysis to our previous one, we compared traffic patterns to these alternative search engines, Pre-DMA and Post-DMA.

The results were less dramatic. Despite the changes, customer loyalty to Google remains strong. Traffic to non-gatekeeper search engines has remained flat year over year(+/- 1%) in DMA countries, indicating that users have not significantly shifted their search engine preferences.

With the DMA now fully in effect, brands must adapt to a landscape where competition rules have shifted – and Google faces new obligations. Here's how Yext can support your brand in navigating these changes effectively:

Optimize for entity results

Google now focuses more on "entity results" for real-world entities like local places and products. Yext Pages can help you:

• Structure your data: Use Yext's Knowledge Graph to provide Google with detailed, structured information about your brand. This approach to information management improves your chances of appearing in search results.

• Enhance visibility: Make sure your Yext Pages are complete with descriptions, reviews, and direct links. This approach to Yext Pages helps users find and interact with your brand's locations easily.

Make direct connections to customers

The DMA encourages direct user-to-business connections in search results. Yext can help you leverage this with flexible capabilities:

• Add Direct links and calls: Add direct links and call-to-action buttons to your Yext Pages, facilitating immediate user interactions.

• Manage accurate information: With Yext Listings, you can keep your business data consistent and up-to-date across over 200 publishers, ensuring users always find reliable information.

Make data-driven decisions

Yext Analytics provides tools to monitor and adapt to changes:

• Traffic insights: Track changes in your search traffic to optimize strategies for better visibility.

• Performance comparison: Compare your brand's location performance Pre-DMA and Post-DMA to identify trends and opportunities.

The DMA is contributing to reshaping the digital landscape, and Yext is committed to helping you adapt and thrive. We will continue to monitor developments and keep you updated on how these changes may impact your brand. Stay tuned for more insights and updates from Yext as we navigate this new era of digital regulation together.

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