Surviving and thriving in the digital marketplace: Why startups and SMEs need the DMA

As the digital landscape continues to evolve, startups and small to medium-sized enterprises (SMEs) face unique challenges in establishing themselves and competing with larger companies.

However, the introduction of the Digital Markets Act (DMA) by the European Commission (EC) brings real opportunities. This groundbreaking regulation aims to level the playing field, promote fair competition, protect consumers’ data privacy, and safeguard their data. In this article, we will explore the top six benefits that the DMA brings to startups and SMEs.

The DMA helps ensure that startups and SMEs have fair and equal access to the digital marketplace. By targeting the designated gatekeepers—large tech corporations with outsized reach and influence power—the regulation promotes competition and helps to prevent unfair practices that hinder smaller players from reaching their target audiences and accessing the data they need to grow.

With the DMA in place, startups and SMEs can expect a more innovative ecosystem. By deterring anti-competitive behaviors, the regulation requires gatekeepers to work more collaboratively with smaller entities, fostering a culture of innovation and knowledge exchange.

One of the core objectives of the DMA is to protect user data and privacy. This is particularly beneficial for startups and SMEs, as it helps to prevent noncompliant access to and use of user data, particularly by some gatekeepers that have been targeted for their practices in the EU before. Compliance with the DMA helps to ensure that smaller businesses have access to the same consented data that large enterprises do, and can build trust with their customers by prioritizing data protection and privacy via the same mechanisms.

The DMA introduces stricter transparency requirements for the designated gatekeepers, helping to ensure that startups and SMEs have clearer insights into the operations of gatekeepers. This includes not only access to user data, but also, for example, the functions of ranking systems and other tools that affect third parties. This transparency empowers smaller businesses to make informed decisions, negotiate fairer terms, and navigate the digital landscape more effectively.

The DMA requires enablement of data portability, so startups and SMEs can access and transfer user data from one platform to another, or companies’ users can do the same with their data. This facilitates smoother transitions and lowers barriers to entry in the digital market, enabling smaller businesses to reach a wider audience, grow their platforms, and scale their operations more effectively.

The DMA establishes clear and efficient complaint mechanisms, enabling startups and SMEs to address any unfair practices or anti-competitive behaviors by gatekeepers. This provides smaller businesses with a platform to voice their concerns, help direct enforcement, and work to ensure a fair and competitive environment for all players in the digital market.

If you’re a startup or SME working to grow in the digital ecosystem it’s time to take advantage of the benefits of the DMA.

Don’t delay DMA compliance actions until March 2024. Get a free data privacy audit for your website today. Understand where you stand on GDPR compliance—with which the DMA is aligned—and what changes you may need to implement to meet DMA requirements based on your operations and the gatekeeper platforms and services you use.

If you don’t have a consent management platform (CMP) already, it should be your number one priority. Adopting a consent solution for your website(s) and/or app(s) that gets you ready for the DMA will help to ensure that you can continue using the gatekeepers’ services and signal explicit user consent to enable continued collection, processing, and sharing personal data obtained and disseminated via these platforms.