First pushback against EU's Digital Services Act and it's not Google Pick two massive platforms you'd think would be first to bring the fight to the EU lawmakers over the Digital Services Act... then forget both of them. Because it was German fashion retailer Zalando that filed a lawsuit today. The EU first unveiled its hitlist of influential platforms on 26 April. As we explained earlier that …
For Brits, I guess it is sort-of a copy of Boohoo.
They also own Burton, Debenhams, Dorothy Perkins, Warehouse, Oasis, Karen Millen, Coast, Wallis, Nasty Gal, and PrettyLittleThing.
Some of those brands, you might think you are familiar with, but those trademarks were bought from the liquidators when their retail stores went bust, so they are not the same company any more.
They are indeed very big in Central Europe as the 10 billion+ revenue figure might have indicated.
They basically have taken Netflix's old DVD business model to fashion.... you order the clothes / shoes you want to try, keep the ones you like and send back (for free) the ones that don't fit / you don't like. The shipping costs more than offset the cost of having a high-street store (and transport / energy costs be damned*), and the volume allows them a much lower margin (and pricing) than high street stores.
*Although to be fair maybe the heating / lighting costs of 10000 physical stores + the travel costs of customers to the stores + the shipping to all the stores are, in fact, higher than shipping all the clothes between a central warehouse and the end client
IIRC not all returns are free any more.
Regarding quality: this isn't the cheapest shit. The people I know who've used the service are professional women who are exasperated at the lack of reasonably priced professional clothes on the high street. They don't mind spending money on clothes, as long as they can find something that suits them and fits, in a reasonable period of time. For them, it's now easier and quicker to do the "fashon show" at home and they don't mind paying for the returns if they find something they like.
But, not knowing who Who is and not wishing to know who Who is, do they advertise or push third party content within their site or sell marketing data out of their site?
If they only sell their own product and data is used internally to the site that could be construed as simply being an online-catalogue with appropriate marketing and self-promotion.
However if they sell third party advertising and content or have hidden data collection/selling regimes that would be a different kettle of Zuck and leaves any large seller open to individual state control ...
If the EU haven't well defined who will be directly impacted by this ruling I would suggest its lawyers and policy makers should be sacked for getting it wrong, or perhaps congratulated by big business on their creation of a "hard hitting public friendly policy" with effective escape routes and avoidance procedures for those who want to ...
I definitely know them, have bought for them a few times. Last was a pair of leather shoes, for about 100€. A good brand, that I've come to like years ago from a brick & mortar shop. No algorithm suggestion involved in that case, they just happened to have what I wanted available for sale :)
"The company also contests the unequal treatment resulting from the absence of a clear and consistent methodology to assess whether a company is a "Very Large Online Platform""
...and...
"The Commission has previously said it defines a VLOP as a company that reaches 45 million users or more, with Zalando saying on its website that it serves over 50 million "active" customers."
Seems like the Commission does indeed have a "clear and consistent methodology", and Zalando are by their own admission/boast falling squarely into that category.
" the European Commission "did not take into account the majority retail nature" of its business model and argued that it "does not present a 'systemic risk' of disseminating harmful or illegal content from third parties.""
If that is indeed the case, surely they can easily demonstrate that they don't spread misinformattion etc, and being regulated directly by the EU rather than by Germany will make no difference
I don't know about that. It seems rather complicated, look:
> The Commission has previously said it defines a VLOP as a company that reaches 45 million users or more
> Zalando saying on its website that it serves over 50 million "active" customers
> the company was "puzzled" as to why it was designated as a very large online platform
I'm stumped.
The problem might not be with "very large", but with "online platform". After all, I doubt this is the only large store in the EU. If you take a store that has lots of customers and also has a website where people can buy things, does that make them a very large online platform as well? If you have a website where people can read things but not post, but that site is popular, would that be an online platform? Would an ISP count if it had more than 45 million customers, which several EU-based ISPs appear to meet? What does a site need to do in order to qualify if they have enough visitors?
This appears to be Zalando's complaint, not that they don't have enough customers to qualify but that the stuff they're doing online isn't related to the point of the regulation or to others that have been named. I'm not sure if that is convincing, possibly because I've never used their business and therefore don't have a great idea of whether they have some business that would fall under the regulation, but the definitional argument doesn't entirely rely on the number of customers.
Do you want to address the point I made at length in that comment? The point I was making, which I think you understand already, is that, if there are no other conditions, there will be a lot of qualifying companies that aren't on the list. A retail store that serves 50 million customers in the EU would count, even if 48 million of those are buying things in physical shops and only 2 million use the website. An ISP serving 50 million customers would qualify. A newspaper that gets read by 50 million IP addresses would qualify. None of those things are on the list. This suggests that there is some other condition than a certain number of EU customers and having a website.
If that condition exists, it becomes reasonable to ask what it is and who does or should fall under that condition. You are focusing on the obvious points that they meet a threshold of customers, which I admitted in my first sentence, and are ignoring the definitional questions that are important to deciding whether this company has a point or is talking rubbish.
If that is indeed the case, surely they can easily demonstrate that they don't spread misinformattion etc, and being regulated directly by the EU rather than by Germany will make no difference
DSA is a lot more than just "being regulated". They'll need to provide constant reports of their algorithms, quality processes and customer support workflows to the EU, forever. It's not fun, and it costs money. I don't blame them for trying to get out of it.
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