Liam Walsh
Liam is a Co-Director at Intelligency and heads up the agency's Digital Intelligence & Paid Social activity. Over the last decade, he has worked with brands from the world of sports such as Premier League clubs to entertainment such as Channel 4 and Disney.
The European Commission accuses Meta of breaching the Digital Markets Act. They have determined that Meta’s “pay or consent” advertising model is in breach of the current rules. Meta’s model in the EU requires users to either consent to personalized ads or pay €12.99 per month to avoid any advertising content from being shown to users.
Why is this currently in breach of the DMA?
The EC has claimed that Meta’s model doesn’t comply with the DMA which requires that users who do not consent to personalized ads must still have access to an equivalent service using less of their personal data. The European Commission has stated that they oppose this binary option.
What has Meta said in response?
Meta claims that their subscription model without ads complies with the highest court in Europe and the DMA and therefore would likely oppose any fines that were in place. The EC could potentially impose a fine of 10% of Meta’s global revenue.
Meta previously offered to lower its base subscription fee from €9.99 to €5.99 to address regulators’ concerns which shows there could be a negotiation to be had.
Why are Meta facing more stringent sanctions than other companies?
Meta is classified as a “gatekeeper” under EU rules, which imposes stricter obligations to ensure fair competition and level-playing field in digital markets. Similarly, Apple was recently targeted by the EU who accused them of breaking the same laws due to their App Store.
What is the European Commission aiming to achieve?
The investigation seeks to empower users. They want users to have more control over their data which should ensure fair competition in the digital advertising ecosystem. By creating a fairer and more level playing field users will be exposed to an array of brands of their choosing rather than any gatekeeper. The investigation is expected to conclude within the next 12 months.
