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Meta faces EU scrutiny over ad model

by on02 July 2024


Sniffs of anti-trust

 Meta is encountering obstacles while striving to comply with the European Union's stringent online competition law, the Digital Markets Act (DMA).

Its cunning plan involved offering  Facebook and Instagram subscriptions as an alternative for privacy-conscious users who wish to avoid targeted ads.

Meta's approach, known as the "pay or consent" model, gives users a choice: either pay for platform access or consent to data collection for ad targeting. However, the European Commission (EC) has raised concerns about its compliance with the DMA.

The EC's preliminary findings reveal two violations:

1. The model doesn't allow users to opt for a service using less personal data but is equivalent to the personalised ads-based service.

2. Users can't freely consent to combining their data.

Meta now has an opportunity to review the EC's evidence and defend its policy. The investigation is expected to conclude next March.

Internal market commissioner Thierry Breton said the DMA empowers users and ensures fair competition. The EC acknowledges the need for further dialogue to achieve effective compliance.

Meta could face fines of up to 10 per cent of its global turnover if found non-compliant, with repeat infringement fines of up to 20 per cent.

Meta asserts that its "subscription for no ads" model aligns with the Court of Justice of the European Union (CJEU) last year.

Meta introduced its ad-free subscription service in November. Prices vary depending on the platform, considering Apple and Google fees.

Last modified on 02 July 2024
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