The European Commission has opened an investigation into Meta's possible violation of the Digital Markets Act through its pay-or-accept model. This could lead to significant fines for the tech giant.
Investigation against Meta
EU charges
The European Commission raised suspicions that the company Meta violated the law "On Digital Markets" (DMA). The main reason was the "pay or accept" business model that the company applies to users of its social networks. This is reported by Financial Times.
The essence of the problem
Currently, Facebook and Instagram users have two options: to use the platforms for free, agreeing to the collection of personal data for targeted advertising, or to pay for the absence of such collection. It is this model that has caused concern among European regulators, who believe that it may conflict with the requirements of the DMA.
Position of the European Commission
EU officials emphasize that users who do not consent to data collection should be able to access a similar service that uses less of their personal information. This calls into question Meta's current policy on handling user data.
Meta Answer
Meta claims that their ad-free subscription model complies with both the European Court of Justice and the DMA requirements. Representatives of the technological giant expressed readiness for a constructive dialogue with the European Commission to resolve this issue.
Possible Consequences
If Meta is found guilty of violating the DMA, the companies face significant financial penalties. Fines can reach 10% of the company's global turnover, and for repeated violations - up to 20%. Final findings on the investigation are expected within a year of its official launch in March.
Context of the investigation
The Law "On Digital Markets" was adopted in the EU in the spring of 2022 and entered into force on May 3, 2023 . Its purpose is to ensure fair competition in the digital market. In March 2024, the European Commission launched an investigation into the compliance of major technology companies, including Apple, Alphabet and Meta, with DMA requirements.
Earlier, on June 24, the EU already accused Apple of violating this law due to the rules of the App Store. In addition, in March 2024, Apple received a fine of €1.84 billion for violating rules regarding informing iOS users about alternative music subscription services.
Experts believe that these accusations demonstrate the desire of Brussels to quickly react to possible anti-competitive behavior of technological giants.
Glossary
- Meta is an American technology company, owner of social networks Facebook and Instagram
- DMA (Digital Markets Act) - the EU law "On Digital Markets" aimed at regulating the activities of large technology companies
- European Commission - executive body of the European Union
- App Store - application store for Apple devices
- iOS - operating system for Apple mobile devices
Link
- Financial Times: Article on Meta allegations
- TechCrunch: On DMA coming into force
- Statement of the European Commission regarding the investigation
- Associated Press: Apple Accused of DMA Violation
Questions Answered
What is the Digital Markets Act (DMA) and why is it important?
What are the EU's allegations against Meta?
What are the possible consequences for Meta if she is found guilty?
How does Meta respond to the European Commission's accusations?
Have there been similar cases with other tech companies?
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Discussion of the topic – The European Commission accuses Meta of violating the digital law: what does this mean for users?
The EU suspects Meta of violating the Digital Markets Act over its pay-or-take-it model for Facebook and Instagram users. The European Commission is investigating the company's data collection practices.
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Oleksandr
I wonder how it will affect Facebook and Instagram users in Ukraine? 🤔 Maybe we should also expect changes in the privacy policy?
Sophia
Oleksandr, I think this could lead to more transparency regarding the use of our data. But are we ready to pay for social networks without advertising? 💸 I personally do not.
Maximilian
This can be a great opportunity to grow alternative social networks! 🚀 Does anyone know of good Ukrainian platforms that could compete with Facebook?
Isabella
Maximilian, interesting thought! But will they be able to offer the same functionality? 🤷♀️ Meta has huge resources for developing new chips.
Grumpy_Hans
Oh, again these endless changes and innovations. Why do you need these social networks at all? Only time is wasted and privacy is violated. It would be better to read the book.
Sophia
Grumpy_Hans, I understand your concern, but social media is also a tool for communication and information sharing. Maybe we should just limit their use? 😊
Pierre
And I believe that this is a great step on the part of the EU! 👏 Personal data protection should be a priority. I wonder if Meta will be able to adapt to the new requirements without losing profit?
Oleksandr
Pierre, I agree! But there is a risk that Meta will simply pass on additional costs to users. 💰 Maybe it is worth looking for a balance between data protection and service availability?