This EU law will create a slew of new SaaS opportunities

On November 1st, EU's Digital Markets Act officially entered into force.

This act went through multiple phases and made headlines each and every time. On Hacker News, for example, those stories got 800-1000+ upvotes.

What's the fuss and why are so many people interested in this? Are there any opportunities for us as indie hackers as a result of this change? Let's take a closer look.

The EU wants to disrupt the "winner takes all" dynamic

Platforms usually operate inside winner takes all markets. This means that if, a social network like Facebook takes off and becomes popular, it eats up the majority of the market share.

This has been the case with social networks like Instagram, Facebook, TikTok, search engines like Google, app stores like Google/Apple App Store, etc.

The Digital Markets Act will change this. Let's explore how

Big platform features will become APIs

With this change, big platforms will be forced to "open up" their features.

For example, messaging apps like WhatsApp / iMessage will need to open up and become interoperable with smaller messaging platforms.

The European Union calls these platforms "gatekeepers". It's just a fancy term for huge companies that have platforms. So Facebook, Instagram, Google, etc.

Here's a list of what those gatekeepers will be forced to do:

Notice the first check-mark: allow third parties to inter-operate with the gatekeeper's own services in certain specific situations.

In other words, have APIs that with allow interactions with other services.

Platforms can't favor their own services

Google and others will no longer be able to promote their own local, travel or job services over those of rivals in search results.

Here's a list of the things those platforms will not be able to do anymore:

All of this means that we, the smaller players, will have more opportunities to compete in those industries.

Payments are included as well: Platforms like Google and Apple won't be able to force you to use their own payment services if you want to sell apps on their platforms. This is already happening in countries like South Korea.

And just yesterday,

What all of this means for us as indie hackers

A plethora of new opportunities to build products that weren't possible before.

This Hacker News comment gives a nice overview of what iPhone users specifically will be able to do once this law is enforced:

• Install any software

• Install any App Store and choose to make it default

• Use third party payment providers and choose to make them default

• Use any voice assistant and choose to make it default

• User any browser and browser engine and choose to make it default

• Use any messaging app and choose to make it default

• Make core messaging functionality interoperable. They lay out concrete examples like file transfer

• Use existing hardware and software features without competitive prejudice. E.g. NFC

There's a product opportunity behind each of these bullet points. So you'll be able to build products like:

• An unifying messenger which combines iMessage/Facebook Messenger/others in a single interface.
• An alternative app store where users can download/install their own apps.
• Voice assistant features or a voice assistant alternative. Your own Siri/Google/Alexa.
• Use NFC inside your web app, not having to build a separate App Store App.

...and much more.

That's pretty exciting and it opens up hundreds, if not thousands of opportunities for new products.

This law is already a reality

This law has already entered into force.

The Digital Markets Act now moves into a six month implementation phase and will start to apply on 2 May 2023.

Following their designation, gatekeepers will have six months to comply with the requirements in the DMA, at the latest by 6 March 2024.

We could see swift changes over the next 1-2 years that could have tectonic consequences.

The fines are huge: If those gatekeeper platforms don't comply, they can be fined of up to 10 per cent of the company's worldwide turnover, and up to 20 per cent in the case of repeat offenders.

The first-mover advantage is real

Shortly after Apple announced they'll enable South Korean developers to add third-party payment methods to their apps, Paddle came up with an "in-app purchase" alternative payment service:

This is a screenshot of their webpage and it was taken several days ago. Yes, they're still in "waitlist" mode. According to a blog post they published in January 2022:

We now have to postpone our launch as Apple and their legal team still haven’t shared the necessary technical changes and new rules, which enable app developers and alternative solution providers (like us) to be fully compliant.

Paddle didn't wait for Apple to publish the entire list of changes. They launched quickly and now probably have thousands of users on their waitlist.

So whenever Apple launches the official guidelines, Paddle will have a big first-mover advantage.

There are 2 things to note here

• These platform updates will take time I expect that Apple/Google/Facebook will move at a snail's pace to release APIs to their most popular features, etc.

• This doesn't mean you have to wait for a fully published version in other to make use of this opportunity. Like Paddle, you could publish a landing page with a waitlist and start collecting subscribers once you get an official update (like Apple announcing an API for iMessage, for example).

2023 will be an interesting year.