Could the EU’s Digital Agenda Force Apple to Put Flash On the iPhone?

An ongoing digital strategy by the European Union (EU) could force Apple (s aapl) into allowing Adobe’s (s adbe) Flash to run on the iPhone.

The incomplete plans, known as the Digital Agenda, not only aim to redefine how antitrust rules are practiced, but also hope to see an overall improved digital economy in place by 2020. In order to reach this goal, the EU plans to work with a number of individual companies, relevant organizations and governments. The efforts carried out with these various groups will involve working through seven key points. The second point of this seven-part plan is one which may be of concern to Apple.

Point two of the Digital Agenda highlights the need for set standards and interoperability between devices. It specifically states:

The internet is a great example of interoperability — numerous devices and applications working together anywhere in the world. Europe must ensure that new IT devices, applications, data repositories and services interact seamlessly anywhere — just like the internet. The Digital Agenda identifies improved standard-setting procedures and increased interoperability as the keys to success

How This Could Affect Apple

It’s no secret that the European Union isn’t shy to flex its muscle when it comes to competition rules. In the past, it has fined various industry heavyweights including Intel (s INTC) and Microsoft (s MSFT). In fact Microsoft has found itself in the firing line on multiple occasions.

[inline-ad align=”right”]But what could the Digital Agenda truly mean for Apple? Comments from European Union commissioner Neelie Kroes hint that she is giving Apple’s business practices a serious review. According to a report from Rethink Wireless, the commissioner has concerns that the current smartphone market is too closed, detailing that consumers are currently limited when coming to choose what software is present on their selected handset.

With the Digital Agenda in place, dominant market figures, such as RIM (s RIMM) and Nokia (s NOK), will not be the only ones to receive official practice reviews. Figures that are deemed significant, such as Apple, will also be called upon. Kroes detailed that:

“…significant market players cannot just choose to deny interoperability with their product. This is particularly important in cases where standards don’t exist. This is not just about Microsoft or any big company like Apple, IBM or Intel. The main challenge is that consumers need choice when it comes to software or hardware products.”

With Kroes’ comments in mind, it seems that Apple’s banning of Flash could come under serious investigation from the EU. Other blogs have speculated on how the Digital Agenda’s rules may apply beyond Apple’s Flash ban. Some have suggested that this digital strategy could be applied to change the closed nature of iPhone development via Xcode, whereas others have expressed thoughts on how iTunes’ restrictive style could be an issue — especially considering the whole Palm Pre syncing drama.

With the U.S. Fair Trade Commission looking into Apple’s ban on Flash and the European Union also casting an authoritative eye over the issue, it will be interesting to see how Apple would handle the Flash ban if any official body were to make a move.

Whatever happens, with both Apple and Adobe picking and choosing both open and closed formats and practices, one thing is clear: nobody’s perfect.

Related GigaOM Pro Research (subscription required): A Brighter Week Ahead for Flash