For the past eight months, Europeans uncomfortable with the way Meta tracks their data for personalized advertising have had another option: pay the tech giant up to 12.99 euros ($14) a month for privacy protection.
Meta, which launched in November 2023, introduced a “pay or agree” subscription model after fines, lawsuits and regulatory attention pressured it to change the way it asks users for consent to targeted advertising. But on Monday, the European Commission rejected its latest solution, arguing that “pay or agree” subscriptions violate the European Union’s new Digital Markets Act (DMA).
“Our preliminary view is that Meta’s ‘pay or consent’ business model violates the DMA,” Thierry Breton, EU internal market commissioner, said in a statement. “The DMA is there to give users back the power to decide how their data is used and to enable innovative companies to compete on an equal footing with tech giants for access to data.”
Meta denied the allegations that its subscription model violates the rules. “Our ad-free subscriptions comply with the DMA, as instructed by the European Supreme Court,” Meta spokesman Matt Pollard told WIRED. This referred to a July ruling by the Court of Justice of the European Union (CJEU) that found Meta must offer users alternatives to advertising where appropriate, at a reasonable fee. “We look forward to further constructive dialogue with the European Commission to bring this investigation to a close.”
At a press conference on Monday morning, European Commission officials said they were not concerned that the company was charging for its ad-free service. “As long as there is a middle option, it’s perfectly fine for us,” they said, explaining that there should be a third option that includes ads but isn’t targeted. They added that there are other ways to serve ads to users, such as contextual ads, that are less specific. “Consumers should be in a position to choose an alternative version of the service that doesn’t personalize ads.”
The DMA states that very large tech platforms must seek users’ consent if they want to share their personal data with other parts of their business. In the case of Meta, the Commission said it was particularly concerned that by combining data from platforms such as Instagram and its own advertising business, Meta was gaining a competitive advantage over its rivals.
Meta has a chance to refute the charges made on Monday, but if the company fails to reach an agreement with regulators by March 2025, Brussels has the power to impose fines of up to 10% of the company’s global turnover.
The European Commission issued a series of warnings to major US tech companies last week. It warned Apple that its App Store violates EU rules that ban app developers from offering direct promotions to users. The EU also accused Microsoft of abusing its dominance in the office software market, following a complaint from rival Slack.
