In the wake of new EU regulations, independent browser firms have witnessed a surge in users, challenging the dominance of tech giants like Google (GOOGL, Financial), Microsoft (MSFT, Financial), and Apple (AAPL, Financial). This increase in user base is attributed to the implementation of the Digital Markets Act on March 7, which mandates that large technology companies allow mobile users the freedom to choose their web browsers through a "choice screen."
This legislation aims to dismantle unfair competition by ending the pre-installation of default browsers on mobile devices. Historically, Apple's Safari and Google's Chrome have dominated the market by being the default browsers on their respective devices. However, the new EU rules are reshaping this landscape.
Among the beneficiaries, Aloha Browser, based in Cyprus, reported a 250% increase in EU users in March alone. Aloha, established in 2016, emphasizes privacy and generates revenue through subscription services rather than ad sales. "The EU has now become our second-largest market," stated Aloha's CEO, Andrew Frost Moroz.
Other browsers such as Vivaldi from Norway, Germany's Ecosia, and the U.S.-based Brave have also experienced growth in their user base following the regulation change. DuckDuckGo and Opera, although noting an increase, mentioned that the full impact is yet to be seen as the choice screen rollout continues.
The new EU rules require mobile device manufacturers to present users with a choice screen for browsers, search engines, and virtual assistants during device setup, a departure from the previous practice of pre-loading devices with default services. Apple now offers up to 11 browser options alongside Safari in its choice screen for each EU country, with updates planned annually.
Google has begun displaying browser choices on its devices and anticipates other Android-operating devices to follow suit. Despite the positive trend for smaller browsers, especially on iPhones, some browser companies have criticized the implementation of these new features by Apple and Google as sluggish and cumbersome.
Mozilla, the parent company of Firefox, estimated that only 19% of iPhone users in the region received an update, suggesting a slower rollout compared to previous updates. The design of the choice screen, particularly on iPhones, has been critiqued for its complexity, potentially hindering users from exploring new browser options. This has led the European Commission to initiate an investigation into Apple's compliance with the new regulations.
