LONDON — European Union regulators on Monday accused social media company Meta Platforms of violating the bloc’s new digital competition rulebook by forcing Facebook and Instagram users to choose between seeing ads or paying to avoid them.
Meta began offering European users the option to pay for ad-free versions of Facebook and Instagram in November as a way to comply with the continent’s strict data privacy rules.
Users can pay as little as 10 euros ($10.75) a month to avoid being targeted with ads based on their personal data. The U.S. tech giant introduced the option after the European Union’s top court ruled that Meta must first get consent before showing ads to users, threatening the company’s business model of customizing ads based on individual users’ online interests and digital activity.
The European Commission, the EU’s executive body, said preliminary findings of its investigation found that Meta’s “pay or consent” advertising model violated EU27 digital market law.
The commission said Mehta’s model does not allow users to exercise their right to “freely consent” to combining personal data from various services, including Facebook, Instagram, Marketplace, WhatsApp and Messenger, to serve them personalised online ads.
The company also said that Meta’s model does not offer users the option of a less personalized but equally social networking service.
“Our ad-free subscriptions comply with the DMA as instructed by the European Supreme Court,” Mehta said in a statement. “We look forward to further constructive dialogue with the European Commission to bring this investigation to a close.”
The commission began its investigation shortly after the rulebook, also known as the DMA, took effect in March, a sweeping set of regulations aimed at preventing technology “gatekeepers” from monopolizing digital markets under threat of heavy fines.
One of the DMA’s goals is to curb the power of big tech companies that collect vast amounts of personal data about users to gain an advantage over rivals in online advertising and social media services, and the commission suggested that for Meta to comply, it would need options that don’t rely on sharing users’ entire personal information for advertising.
“The DMA exists to give users back the power to decide how their data is used and to allow innovative companies to compete on an equal footing with tech giants for access to data,” Thierry Breton, the European Commissioner who oversees the EU’s digital policy, said in a statement.
Meta now has the opportunity to respond to the commission, which must complete its investigation by March 2025. The company could be fined up to 10 percent of its annual global revenue, which could amount to billions of euros.
Under the Digital Markets Act, Meta is classified as one of seven online gatekeepers, while Facebook, Instagram, WhatsApp, Messenger and their online advertising businesses are included in 24 “core platform services” that are subject to the highest level of scrutiny.
Monday’s decision is the latest in a series of regulatory actions from Brussels targeting big tech companies. The EU filed its first charges under the DMA a week ago, accusing Apple of preventing app makers from steering users to cheaper options outside the App Store. The EU also recently accused Microsoft of violating EU antitrust rules by bundling its messaging and videoconferencing app, Teams, with its widely used business software, Office.
