📅 Background of the Issue
On March 25, 2024, the EU Commission began an investigation into Meta's new “pay or consent” model. The model, introduced in November 2023, forces EU users of Facebook and Instagram to choose between paying for an ad-free experience or consenting to personalized ads. This binary choice is seen as a violation of the Digital Markets Act (DMA), particularly Article 5(2), which requires gatekeepers to provide an equivalent service using less personal data if users do not consent.
📈 Preliminary Findings
The Commission's preliminary findings, announced today, indicate that Meta's model does not comply with the DMA. Meta's current options do not allow users to access a less personalized service equivalent to the one with personalized ads. Margrethe Vestager, Executive Vice-President in charge of competition policy, stated, “Meta’s advertising model fails to comply with the Digital Markets Act.” This approach raises high barriers for competitors and fails to respect users' rights to control their personal data.
🔍 Next Steps
Meta has the opportunity to review the investigation files and respond to the Commission's findings. The investigation is set to conclude by March 25, 2025. If the Commission's views are confirmed, Meta could face fines up to 10% of its worldwide turnover, or up to 20% for repeated infringements. Thierry Breton, Commissioner for Internal Market, emphasized the importance of the DMA in ensuring users' control over their data and fair competition in digital markets.
📢 Implications and Reactions
The potential outcomes of this investigation include significant fines and other remedies, such as selling parts of the business or bans on acquisitions. The Commission aims to ensure compliance and empower users with more control over their data. Breton added, “Today we make another important step to ensure full compliance with the DMA by Meta.” The decision will have broad implications for how digital platforms operate in the EU, potentially setting a precedent for other tech giants.
Should tech giants be allowed to force user consent?
