Brussels, BELGIUM – Boosting Europe’s digital competitiveness requires EU regulators to carefully consider the unintended economic fallout of the Digital Markets Act (DMA) on other sectors, and avoid premature regulatory intervention in the thriving generative AI landscape. These are the key findings of two independent studies unveiled today.
While generative AI is found to represent a highly dynamic, innovation-driven market shaped by customer demand in Europe, the DMA is inflicting significant economic harm – estimated at up to €114 billion annually – on parts of the economy far beyond its intended scope.
The studies were launched by their respective authors at the ‘Reality Check: AI Competition Dynamics & the DMA’s Economic Cost to Europe’ conference in Brussels, hosted by the Computer & Communications Industry Association (CCIA Europe).
The new DMA-focussed report finds that, despite its pro-competition goals, the DMA is triggering major economic losses across the broader EU economy, with total turnover in the sectors considered down up to 0.64% per year since May 2023.
These impacts result from diminished personalisation, reduced reach, higher transaction costs, and the loss of valuable platform integrations – all consequences of changes required by EU regulators under the DMA. The most impacted sectors include accommodation (up to €14 billion in annual losses) and retail (€4.4-59 billion per year).
As the DMA review approaches, these insights underscore the need for a critical evaluation to ensure the Act genuinely supports growth, innovation, and competitiveness.
In contrast, the study on competitive dynamics in generative AI highlights the sector’s rapid evolution and strong potential. The authors conclude that the landscape is dynamic across all levels of the value chain. The deployment layer, in particular, holds major untapped potential, attracting growing capital due to the high value of real-world AI applications.
Previously anticipated risks have not materialised, according to the report, making early regulatory action unnecessary – and potentially harmful to the generative AI sector.
To stay competitive, Europe must learn from past mistakes and support innovation in generative AI by resisting premature regulatory moves. Today’s findings suggest that, by restricting key platform features, the DMA is having the opposite effect on many sectors.
The following can be attributed to CCIA Europe’s Senior Policy Manager, Boniface de Champris:
“Generative AI is thriving in Europe, with dynamic and contestable markets at all levels of the value chain and significant untapped potential at the application layer. This study shows that regulatory intervention is not warranted and could slow innovation.”
The following can be attributed to CCIA Europe’s Policy Manager, Maria Teresa Stecher:
“The DMA’s unintended side effects cost the broader EU economy up to 114 billion euros annually – impacting sectors never targeted by the Act. It’s time for a serious rethink.”
