EU Commission Finds Meta's 'Pay for Consent' Model in Violation of Competition Rules

Money | July 1, 2024, 7:54 a.m.

The European Commission has found that Meta's "pay or consent" offer to Facebook and Instagram users in Europe violates the bloc's Digital Markets Act (DMA). Preliminary findings indicate that Meta's binary choice forces users to agree to data combination without providing a less personalized alternative. Failure to comply with the regulation could result in penalties up to 10% of global turnover. Critics argue Meta's model demands users accept targeted advertising or pay for an ad-free experience, violating data and consumer protection rules. The DMA aims to level the playing field for gatekeepers like Meta by requiring user consent before tracking for ads. The Commission believes Meta's dominance allows unfair data extraction for ad advantage. Meta's defense cited a court judgment, but the EU emphasizes the need for a non-binary, privacy-safe choice. The investigation is ongoing, with Meta having the opportunity to respond to the findings within a 12-month timeline set by the EU.