In a further blow to big tech companies, the EU has sued Meta for allegedly violating the EU's sweeping online competition rules, known as the Digital Markets Act (DMA).
Along with Google and Apple, Meta is one of the tech giants (designated “gatekeepers”) that are required to comply with the landmark law as of March of this year.
Just two weeks after the law came into force, the European Commission launched investigations into all three companies, voicing concerns that the measures they had put in place fell short of complying with the DMA.
In Meta’s case, this pertains to a “pay or consent” model of data sharing.
The model presents EU users of Facebook and Instagram with a choice: use the platforms for free and consent to data collection for advertising purposes, or pay a monthly fee for an ad-free plan to prevent data sharing.
Meta hoped that this choice would satisfy the DMA's requirement that companies obtain users' explicit consent before combining or cross-using personal data across various core platform services.
Now, the European Commission has published its preliminary findings, finding that the model violates the rules.
Regulators say the choice doesn't offer users a comparable version of social networks that use less of their personal information, and financial barriers mean users can't “freely consent” to the combination of their personal information.
If the EU investigation finds that Meta has violated the rules, the tech giant could be fined up to 10% of its global turnover – with the fine potentially increasing to up to 20% in case of repeated violations.
EU takes on big tech
Armed with the DMA's new powers, the EU is taking on the monopolistic practices of big tech companies.
Last week, the European Commission said Apple was violating the law, warning the Cupertino-based company that its App Store still prevents app developers from “freely” directing consumers to alternative options.
“We are dealing with some of the biggest and most valuable companies on the planet,” EU competition chief Margrethe Vestager said in a speech last week.
“The DMA is not an excessive request,” she said, adding that “it is only natural to want a fair, open and competitive market.”
