Investors remain cautious amidst a widespread tech stock downturn this year, with shares of Meta, the parent company of Facebook, plummeting over 30% due to a challenging macroeconomic environment and disappointing financial results.<\/p>\n
Meta has come under fire from EU regulators for allegedly breaching the bloc\u2019s antitrust rules with its new ad-supported subscription service. The European Commission has criticized the service, labeling it a \u201cpay or consent\u201d model that requires users to either pay for an ad-free experience or consent to their data being used for personalized ads.<\/p>\n
This model was introduced on Facebook and Instagram in Europe last year in response to a ruling from the European Court of Justice, which stated that companies must offer an alternative service that does not rely on data collection for advertising purposes.<\/p>\n
However, the Commission\u2019s preliminary assessment suggests that Meta\u2019s offering forces users into a binary choice, violating their rights under the Digital Markets Act (DMA). Regulators argue that users should have access to an equivalent service that uses less personal data while still allowing for some level of personalization.<\/p>\n
A Meta spokesperson defended the company\u2019s approach, stating that it aligns with the direction of the highest court in Europe and complies with the DMA. The spokesperson also expressed a willingness to engage in further dialogue with the European Commission to resolve the issue.<\/p>\n
The EU\u2019s DMA, which became enforceable in March, aims to curb anti-competitive practices by large digital companies and mandate greater openness of their services to competitors. Companies found in violation of the DMA can face substantial fines, up to 10% of their global annual revenue, with potential increases to 20% for repeated breaches.<\/p>\n
In Meta\u2019s case, a breach of the DMA could result in a penalty as high as $13.4 billion, based on the company\u2019s 2023 earnings. Meta now has an opportunity to respond to the EU\u2019s preliminary findings in writing as the commission\u2019s investigation continues. The inquiry, launched in March alongside probes into Apple and Alphabet, is expected to conclude within 12 months.<\/p>\n","protected":false},"excerpt":{"rendered":"
Tech giant\u2019s new service model under scrutiny for compliance with European Digital Markets Act<\/p>\n","protected":false},"author":331,"featured_media":47972,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[9],"tags":[14990,726,124],"class_list":["post-47971","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-tech","tag-antitrust","tag-eu","tag-meta"],"reading_time":"2 min read","_links":{"self":[{"href":"https:\/\/www.businessupturn.com\/usa\/wp-json\/wp\/v2\/posts\/47971","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.businessupturn.com\/usa\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.businessupturn.com\/usa\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.businessupturn.com\/usa\/wp-json\/wp\/v2\/users\/331"}],"replies":[{"embeddable":true,"href":"https:\/\/www.businessupturn.com\/usa\/wp-json\/wp\/v2\/comments?post=47971"}],"version-history":[{"count":0,"href":"https:\/\/www.businessupturn.com\/usa\/wp-json\/wp\/v2\/posts\/47971\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.businessupturn.com\/usa\/wp-json\/wp\/v2\/media\/47972"}],"wp:attachment":[{"href":"https:\/\/www.businessupturn.com\/usa\/wp-json\/wp\/v2\/media?parent=47971"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.businessupturn.com\/usa\/wp-json\/wp\/v2\/categories?post=47971"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.businessupturn.com\/usa\/wp-json\/wp\/v2\/tags?post=47971"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}