EU says Meta ad model violates Digital Markets Act

Regulators want equivalent services for people who don’t want to pay for an ad-free experience or consent to the company collecting personal data.

Today, European Union regulators have asserted that Facebook’s parent company, Meta, has violated the Digital Markets Act with its “pay or consent” ad model and may potentially face significant fines. Under this model, users must either pay for ad-free usage of Meta’s platforms or consent to their data being utilized for personalized advertising.

A statement released today emphasized that this model restricts users from freely consenting to the processing of their personal data. In order to comply with the regulations, Meta must provide alternative services for users who choose not to share their personal information with the company.

Meta has defended its current model, stating that it was developed last year in accordance with European court directions to adhere to the DMA. The company views subscriptions as a legitimate alternative to advertising and has implemented ad-free subscriptions to address regulatory obligations.

In response to the ruling, Meta expressed willingness to engage in constructive dialogue with the commission and is committed to addressing concerns raised by EU regulators.

If Meta is found to be in violation, it could potentially face fines amounting to a significant portion of its earnings in Europe, potentially reaching $13.4 billion. This recent development marks the EU’s second enforcement action against a tech giant in the past week, following a similar crackdown on Apple’s app store last Monday.