Elon Musk’s X has escaped regulation under the European Union’s Digital Markets Act (DMA), despite surpassing user thresholds earlier this year. The European Commission decided Wednesday that X won’t face the DMA’s strict operational rules, such as limits on using third-party data and requiring user consent for targeted ads, as it doesn’t qualify as a “gatekeeper” for business-consumer interactions.
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While this means X avoids regulatory risks and hefty penalties, the Commission’s decision may bruise Musk’s ego. It essentially implies that X’s advertising business is not significant enough to warrant the EU’s fairness controls. The Commission noted that X, despite having 45 million monthly active users and 10,000 business users, isn’t considered a crucial platform for businesses to reach consumers.
Though this ruling spares X from the DMA’s grip for now, the EU will continue to monitor the platform’s market position and could revisit the decision if X’s influence grows. Despite avoiding DMA rules, X still faces other regulatory challenges, such as complying with the Digital Services Act (DSA), which requires transparency and accountability from larger platforms. Ongoing DSA investigations could lead to penalties if X is found in violation of those regulations.
