EU Commission Alleges Meta’s Subscription Model Violates Digital Markets Act
Meta asserts that its policies adhere to the requirements of the Digital Markets Act and the rulings of the Court of Justice of the European Union.
The European Commission has informed Meta that its subscription method, which mandates European Facebook and Instagram users to either share personal data to access the platform or pay for privacy, breaches the Digital Markets Act (DMA) based on initial findings.
Users who opt for the subscription service can access Facebook or Instagram without encountering any advertisements.
“During the subscription period, user data will not be utilized for advertising purposes,” announced the company in an October 30, 2023, statement. For free users, Meta collects their personal information to provide targeted ads.
“To ensure DMA compliance, users who do not consent should have access to an equivalent service that utilizes less of their personal data, specifically for ad personalization,” as per the commission.
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The commission additionally alleged that the firm prohibits users from “freely consenting” to the collection of their personal data on Meta’s platforms like Facebook, WhatsApp, Instagram, Messenger, and Marketplace, amalgamated for personalized ads.
Defending its choices, a Meta spokesperson informed The Epoch Times that the “subscription for no ads” model aligns with the “direction of the highest court in Europe and complies with the DMA.”
In December 2023, Meta highlighted that the Court of Justice of the European Union had ruled in July 2023 the acceptability of the subscription model for obtaining user consent to utilize personal data for targeted ads.
Meta explained that the recent findings by the EU Commission are merely a procedural step, not a conclusive decision. The company has invested an extensive amount of resources to meet DMA requirements.
The company asserted that over a span of two years, more than six decades’ worth of engineering work was dedicated to constructing systems for DMA compliance.
“We anticipate further productive discussions with the European Commission to bring closure to this investigation,” stated the spokesperson.
Meta is entitled to defend itself against the accusations, with the investigation expected to conclude by the end of March next year.
If Meta is found to have violated the DMA, the EU Commission can impose fines of up to 10 percent of the company’s global revenue. Repeat infringements could elevate the fine to 20 percent.
With Meta generating $134.9 billion in revenue last year, potential fines could reach around $13.5 billion, rising to $27 billion for repeated violations.
In instances of systemic noncompliance, harsh measures like mandating the divestiture of a portion of the business could be imposed.
Added Regulation
Meta also expressed in a statement to The Epoch Times that the stringent regulations in Europe could impede innovation in the region, citing a recent article by Nick Clegg, former UK deputy prime minister and current president of global affairs at the company.
“Europe is at the forefront of tech regulation—as evidenced by GDPR, the DMA, DSA, and AI Act—but lags in adopting and deploying tech at scale,” noted Mr. Clegg.
He pointed out that complex regulatory demands are dissuading companies from introducing new products in the region, highlighting delays from Meta and Google in launching their AI assistants.
Meanwhile, “with the rapid integration of AI in the U.S. and China, the gap between these superpowers and the EU is widening,” Mr. Clegg added.
The commission voiced concerns that the algorithms on platforms like Facebook and Instagram, recommending videos and posts, could potentially lead to addiction among children.
