On Monday local time, the European Commission officially accused Meta of violating the EU's Digital Markets Act with its "paid to advertise" advertising model.
After an investigation that began in March this year, the European Commission has preliminarily ruled that Meta's "paid to advertise" subscription will force users to agree to collect data, and there will be no alternative version provided to reject users.
The Meta subscription model was implemented in the EU region in November last year. If users pay 12.99 euros (approximately 101 yuan) per month, they can use ad free versions of Facebook and Instagram, and the platform will not collect personal data for advertising purposes; But if the user does not pay, it is deemed that they agree to the platform's use of personal data.
The Digital Markets Act stipulates that technology giants must obtain separate user consent when merging or cross using personal data between cross platform services. The adjustment of Meta has undoubtedly attracted the attention and dissatisfaction of the European Commission.
Meta has previously argued that the new subscription model explicitly asked users for their consent before providing personalized advertising. "Removing advertisements by subscription is a mature business model in many industries. We designed this model to solve multiple overlapping regulatory obligations, and will continue to discuss with the European Commission in the future." The company responded accordingly.
Wei Dongdong, a data compliance lawyer familiar with EU policies, previously told 21st Century Business Herald in an interview that the "paid ad free" subscription model assumes that users agree to Meta's collection of personal data and only exits through payment, which is an implied consent rather than an explicit consent required by the EU. "This seemingly compliant operation has not changed the underlying logic, and the likelihood of being supported by regulatory agencies is unlikely," Wei Dongdong analyzed. (For details, asking users to pay for their privacy? Meta's "paid to advertise" model faces multiple complaints)
A senior official from the European Commission pointed out in an interview that what Meta lacks is a compromise solution - users who refuse to be collected by the platform should be able to use a version with lower levels of personalized advertising. He believes that only in this situation can Meta launch paid subscriptions, such as completely removing advertisements for payment.
It is worth noting that this is the second time since the Digital Market Act officially came into effect in March this year. Last Monday, the bill was first applied to Apple, and the European Commission accused Apple of restricting the development of competitors through the Apple Store. The Digital Markets Act is tailored for technology giants and aims to ensure a fair competitive environment for small competitors. (For details: EU investigation of Apple's 100 day policy: serious compliance issues, or a fine of 10% of annual revenue)
This round of investigation on Meta needs to be completed by the end of March next year. If Meta is found to have violated regulations at that time, it will face fines of up to 10% of global revenue, which could reach $13.5 billion based on the company's 2023 performance.