Meta was charged Monday with violating Europe’s sweeping tech competition law by forcing customers right into a restrictive “pay or consent” model for ads on Instagram and Facebook — escalating a longstanding beef over user privacy.
Billionaire Mark Zuckerberg’s firm rankled regulators by rolling out a subscription service last yr wherein users could pay the equivalent of $14 monthly for an ad-free experience on the apps – or consent to Meta using their personal data for targeted ads.
If Meta is confirmed to have breached the law, the corporate could face fines of as much as 10% of its total worldwide revenue – a figure that would amount to almost $13.5 billion, given the corporate’s global sales in 2023 totaled $134.90 billion.
The costs are the most recent in a long-running regulatory spat battle involving Meta, which has been accused of failing to comply with the European Union’s strict data privacy law generally known as the General Data Protection Regulation, or GDPR.
Last yr, the EU slapped Meta with a record $1.3 billion wonderful for improperly transferring European users’ data to the US.
The European Union’s competition watchdog said Meta’s promoting model violates the Digital Markets Act, which took effect in March and established latest rules governing the behavior of tech firms identified as the web’s “gatekeepers.”
“Within the commission’s preliminary view, this binary selection forces users to consent to the mixture of their personal data and fails to supply them a less personalized but equivalent version of Meta’s social networks,” the European Commission said in an announcement.
EU officials said Meta should offer a 3rd option for users who don’t consent to tracking or pay a subscription fee – a free version of its apps that doesn’t depend on personal data for displayed ads.
Meta earns an enormous chunk of its annual revenue from digital promoting. In the primary quarter of 2024 alone, the social media giant raked in greater than $35 billion in ad sales – roughly one-fourth of which got here from Europe.
“We wish to empower residents to have the option to take control over their very own data and select a less personalized ads experience,” EU competition chief Margrethe Vestager said in an announcement.
An organization spokesperson said Meta’s subscription plan was in compliance with a recent ruling from Europe’s top court.
“Subscription for no ads follows the direction of the best court in Europe and complies with the DMA. We stay up for further constructive dialogue with the European Commission to bring this investigation to an in depth,” a Meta spokesperson said in an announcement.
Meta has been informed of the costs and might be given a likelihood to defend its business practices, the commission said. The investigation is anticipated to wrap up by March 2025.
EU officials said the corporate violated specific provisions of the Digital Markets Act by failing to permit users to “go for a service that uses less of their personal data but is otherwise corresponding to the ‘personalized ads’-based service.”
Meta’s digital ads model also “doesn’t allow users to exercise their right to freely consent to the mixture of their personal data.”
Meta is the second company to face formal charges during Europe’s Digital Markets Act.
Last week, EU officials slapped Apple with preliminary charges for stopping app developers from easily steering customers to cheaper offers outside its App Store.
Like Meta, Apple could face billions in fines if the costs are upheld.
In a separate motion, Europe accused Microsoft of doubtless violating the law by bundling its Teams software with office productivity apps comparable to Office 365 and Microsoft 365.
With Post wires
Meta was charged Monday with violating Europe’s sweeping tech competition law by forcing customers right into a restrictive “pay or consent” model for ads on Instagram and Facebook — escalating a longstanding beef over user privacy.
Billionaire Mark Zuckerberg’s firm rankled regulators by rolling out a subscription service last yr wherein users could pay the equivalent of $14 monthly for an ad-free experience on the apps – or consent to Meta using their personal data for targeted ads.
If Meta is confirmed to have breached the law, the corporate could face fines of as much as 10% of its total worldwide revenue – a figure that would amount to almost $13.5 billion, given the corporate’s global sales in 2023 totaled $134.90 billion.
The costs are the most recent in a long-running regulatory spat battle involving Meta, which has been accused of failing to comply with the European Union’s strict data privacy law generally known as the General Data Protection Regulation, or GDPR.
Last yr, the EU slapped Meta with a record $1.3 billion wonderful for improperly transferring European users’ data to the US.
The European Union’s competition watchdog said Meta’s promoting model violates the Digital Markets Act, which took effect in March and established latest rules governing the behavior of tech firms identified as the web’s “gatekeepers.”
“Within the commission’s preliminary view, this binary selection forces users to consent to the mixture of their personal data and fails to supply them a less personalized but equivalent version of Meta’s social networks,” the European Commission said in an announcement.
EU officials said Meta should offer a 3rd option for users who don’t consent to tracking or pay a subscription fee – a free version of its apps that doesn’t depend on personal data for displayed ads.
Meta earns an enormous chunk of its annual revenue from digital promoting. In the primary quarter of 2024 alone, the social media giant raked in greater than $35 billion in ad sales – roughly one-fourth of which got here from Europe.
“We wish to empower residents to have the option to take control over their very own data and select a less personalized ads experience,” EU competition chief Margrethe Vestager said in an announcement.
An organization spokesperson said Meta’s subscription plan was in compliance with a recent ruling from Europe’s top court.
“Subscription for no ads follows the direction of the best court in Europe and complies with the DMA. We stay up for further constructive dialogue with the European Commission to bring this investigation to an in depth,” a Meta spokesperson said in an announcement.
Meta has been informed of the costs and might be given a likelihood to defend its business practices, the commission said. The investigation is anticipated to wrap up by March 2025.
EU officials said the corporate violated specific provisions of the Digital Markets Act by failing to permit users to “go for a service that uses less of their personal data but is otherwise corresponding to the ‘personalized ads’-based service.”
Meta’s digital ads model also “doesn’t allow users to exercise their right to freely consent to the mixture of their personal data.”
Meta is the second company to face formal charges during Europe’s Digital Markets Act.
Last week, EU officials slapped Apple with preliminary charges for stopping app developers from easily steering customers to cheaper offers outside its App Store.
Like Meta, Apple could face billions in fines if the costs are upheld.
In a separate motion, Europe accused Microsoft of doubtless violating the law by bundling its Teams software with office productivity apps comparable to Office 365 and Microsoft 365.
With Post wires
