BRUSSELS/LONDON, March 8 (Reuters) - As the world's

biggest tech companies revamp their core online services to

comply with the European Union's landmark Digital Markets Act,

the changes could give some smaller rivals and even peers a

competitive edge.

The DMA is Europe's attempt to rein in Alphabet's

Google, Amazon ( AMZN ), Apple ( AAPL ), TikTok owner ByteDance,

Meta Platforms ( META ) and Microsoft ( MSFT ) and create a

level playing field for smaller rivals and ultimately more

competition for Europeans.

The sweeping legislation compels some of the world's biggest

tech companies to make it easier for consumers to pick and

choose services from different providers.

"The winners will be small European businesses which will

get more options and more visibility than large companies," said

Christophe Carugati at advisory firm Digital Competition.

For example, Meta has to make its Facebook Messenger and

WhatsApp services interoperable with eligible rivals, as long as

they meet the company's technical and security standards.

In practice, this means users of other messaging apps such

as Signal and Telegram - which have gained traction

internationally for their emphasis on protecting user privacy -

could soon be able to chat with Messenger and Whatsapp contacts

without switching apps.

Meta says in its compliance report it is striking a balance

between creating a viable approach for the third-party providers

interested in becoming interoperable with Meta while maximizing

user security, safety, and privacy.

Similarly, users of Google's Android phones will

be guaranteed a choice of default search engine when setting up

their device, representing a big opportunity for alternatives

such as privacy-focused DuckDuckGo and environment-conscious

Ecosia.

"The implementation of these new rules is a step in the

right direction, but the proof of the pudding is always in the

eating, and whether we see any meaningful changes in market

share," Sophie Dembinski, public policy chief at Ecosia, said.

Google said in a blog this week said changes to search

results mean large intermediaries and aggregators would get more

traffic while hotels, airlines, merchants and restaurants would

get less.

Consumers in the EU have also won new privacy protections,

as the DMA introduces new rules on how these companies use their

data.

For example, users can disentangle their Facebook and

Instagram accounts, so information will no longer be shared

across platforms for tracking and targeting purposes.

APP STORE WARS

While the DMA offers new avenues for smaller rivals to

access consumers, the incumbent tech giants could also see their

peers take a bite of their market shares.

Apple ( AAPL ) arguably stands to lose the most from the

DMA, which forces it to open up its lucrative App Store, an

opportunity that Big Tech competitors and smaller start-ups

alike will likely pounce on.

Under the DMA, Apple ( AAPL ) will have to allow software developers

to distribute their apps to users in the EU outside of its own

App Store.

Apple ( AAPL ) has warned that changes to its iOS mobile operating

system, Safari web browser, and the App Store bring greater

risks to users and developers as it could include new avenues

for malware, fraud and scams, illicit and harmful content, and

other privacy and security threats.

Apple's ( AAPL ) critics say it is only interested in defending its

profits since it receives a 30% commission on in-app purchases.

The implementation of the new rules comes amid an escalation

of a row between Apple ( AAPL ) and Fortnite maker Epic Games, one of its

longstanding critics.

Fortnite had planned to launch its own app store on iPhones

and iPads in the EU, as per the DMA. But, on Wednesday, Apple ( AAPL )

terminated a new developer account that Epic had created in

Sweden. In response, Epic accused Apple ( AAPL ) of removing one of the

largest potential competitors to the Apple App Store.

The Commission has asked Apple ( AAPL ) for an explanation and sees

the issue as a priority, which could become a test case for the

new rules.