More problems for Meta in the EU because of its pay-or-consent advertising model

Meta faces charges from EU antitrust regulators for allegedly failing to stick to the Union's tech regulations. The situation has to do particularly with targeting the company's recently introduced pay-or-consent advertising model across EU countries, which has already drawn criticism from privacy regulators and activists.

Meta introduced a subscription service without ads for Facebook and Instagram in Europe last November. The service allows users who consent to being tracked to access a free service supported by advertising revenue, or they can opt for a paid ad-free experience.

The European Commission, acting as the EU's competition enforcer, asserted that this binary choice violates the Digital Markets Act (DMA), designed to limit the dominance of major tech companies. The Commission sent its initial findings to Meta, arguing that the binary choice compels users to consent to their personal data being combined and fails to provide an alternative version of Meta's social networks that offers less personalized ads but is otherwise equivalent.

"We want to empower citizens to be able to take control over their own data and choose a less personalized ads experience", stated EU antitrust chief Margrethe Vestager in a statement.

In response, Meta defended its model, citing compliance with a ruling from Europe's highest court. "Subscription for no ads follows the direction of the highest court in Europe and complies with the DMA. We look forward to further constructive dialogue with the European Commission to bring this investigation to a close", said a spokesperson from Meta.

Meta could adjust its advertising approach to avoid potential fines up to 10% of its global annual turnover if found guilty of breaching the DMA. The Commission is expected to conclude its investigation by March next year.

This charge against Meta follows a similar action taken against Apple by the EU watchdog a week earlier, marking another significant move under the new regulatory framework.

Last month, it became clear that Apple has decided not to include its new Apple Intelligence AI technologies in iPhones sold in the EU due to concerns about potential violations of privacy regulations under the Digital Markets Act.

European Commissioner for Competition Margrethe Vestager criticized Apple's move, suggesting it aims to avoid competition obligations outlined in the DMA.