On behalf of the team

On 20 January 2022, the Commission published its final report on its 18-month inquiry into the consumer Internet of Things (IoT) sector.[1]EC Press release of 20 January 2022, ‘Antitrust: Commission publishes final report on consumer Internet of Things sector inquiry’. The inquiry focused on consumer-related products and services that are connected to a network and that can be managed remotely, for example via a voice assistant or mobile device. The final report addresses, among other things, concerns about high barriers to market entry, the impact of a small number of vertically integrated players in the market, and issues concerning access to data, interoperability and exclusivity practices. The high costs of the technology investments and the competitive situation are considered to be the main barriers to entry to and expansion in the sector.

In particular, the investment costs on the market for voice assistants are classified as “almost unaffordably high”. As far as the competitive situation is concerned, various respondents indicated that they were experiencing difficulties in competing with vertically integrated market players and their ecosystems. The report also raises concerns about reduced interoperability due to major forces in the sector, leading to customer lock-in. In addition, the powerhouses in the sector have extensive access to data, giving them dominance over competitors from adjacent markets. The inquiry also identifies market practices that could lead to unfair competitive advantages, such as exclusivity of voice assistants on devices, standard settings and standard installation of certain applications.