Meta’s ‘pay or consent’ model fails EU competition rules, Commission finds

Meta's 'pay or consent' model for Facebook and Instagram fails EU competition rules under the Digital Markets Act.

: The European Commission's investigation has found Meta's 'pay or consent' offer for Facebook and Instagram violates the Digital Markets Act. Meta's current model forces users to either agree to tracking for personalized ads or pay a fee, which the EU does not consider a fair alternative. The Commission may require Meta to offer a free, less personalized option and has given Meta a chance to formally respond to the findings.

The European Commission's investigation revealed that Meta's 'pay or consent' model for Facebook and Instagram does not comply with the Digital Markets Act. The Commission's preliminary findings indicate that the binary choice Meta offers forces users into consenting to data tracking, without providing an equivalent free alternative.

Meta's failure to adhere to the ex-ante market contestability regulation could result in fines up to 10% of its global annual turnover, and up to 20% for repeat offenses. The EU aims to ensure that gatekeepers like Meta provide users a real choice by requiring user consent before tracking for ads.

Meta's proposal to offer a paid subscription as an alternative to ad tracking does not satisfy the DMA's requirements, as it is not considered a valid equivalent to free access. The Commission insists that users who refuse tracking must still have access to a less-personalized, yet equivalent service and suggests the possibility of contextual ads that do not rely on personal data.

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