EU accuses Meta for using targeted advertising

Mon Jul 01 2024
Rachel Long (668 articles)
EU accuses Meta for using targeted advertising

Meta Platforms is being accused by the European Union of violating its recently implemented digital-competition legislation. The accusation stems from Meta Platforms offering Facebook and Instagram users the option to either pay a subscription fee or grant the corporation permission to utilize their data for targeted advertising.

Last year, the social-media business implemented the pay or agree model for European consumers as a means to adhere to the EU’s Digital Markets Act. On Monday, the European Commission, the executive branch of the European Union, stated that the aforementioned strategy was ineffective.

The commission stated that this binary option compels users to give approval for the merging of their personal data and does not offer them an alternative version of Meta’s social networks that is less personalized but nonetheless comparable.

If the European Union regulators conclude that Meta has violated its regulations, the firm may be subject to a penalty of up to 10% of its total global revenue.

Meta stated that its proposal aligns with the guidance it obtained in a verdict from Europe’s highest court last year and adheres to the regulations of the European Union. “We anticipate engaging in additional productive discussions with the European Commission in order to conclude this investigation,” stated a spokesperson.

Meta has become the second business to face penalties under the EU’s Digital Markets Act, a comprehensive statute that establishes fresh regulations for major tech companies worldwide. The law intends to facilitate regulators in promptly addressing potentially anticompetitive actions.

EU regulators recently accused Apple of noncompliance with the law due to its restriction on app developers from freely guiding customers towards alternate methods of making purchases.

The commission stated on Monday that Meta’s “pay or consent” strategy does not provide consumers with the choice to choose an alternative that utilizes less personal data while still being comparable to its standard services. Furthermore, it stated that consumers are not given the freedom to provide their explicit approval for the merging of their personal data.

Meta announced a proposal last year to enable European users to subscribe and pay a monthly charge for an ad-free version of the network. Non-paying users are required to give their approval for the utilization of their personal data in targeted advertising in order to maintain access to the service.

The charges, referred to by the EU as preliminary findings, do not necessarily imply that the corporation will ultimately be proven to have violated the rules. The commission stated that Meta will be given the chance to review the conclusions of the authorities and provide a response.

The panel announced its intention to finish its probe by the end of March in the next year.

Tags EU, Europe, Meta, U.S.
Rachel Long

Rachel Long

Rachel Long is our Desk Correspondent covering Stock Markets across the globe. She is based in New York