EU Declares Meta’s “Pay or Consent” Advertising Model Breaches Digital Markets Act
The European Commission states that Facebook owner Meta’s advertising model, requiring users to either consent to personalised ads or pay a monthly fee, violates EU laws.
Under Meta’s new service in the EU, users must either agree to receive personalised ads or pay €12.99 (£11) per month to opt out. The European Commission has informed Meta that its “binary” advertising choice does not comply with the Digital Markets Act (DMA). However, Meta argues that its EU advertising model is compliant.
“Subscription for no ads follows the direction of the highest court in Europe and complies with the DMA,” said a Meta spokesperson.
The firm faces a potential fine of up to 10% of its global revenue if the EU decides it has failed to comply with its rules.
The EU asserts that the DMA requires users who do not consent to personalised ads “should still get access to an equivalent service which uses less of their personal data.”
Gatekeepers and Regulatory Scrutiny
Meta faces stricter obligations as one of several big tech firms designated as “gatekeepers” under the bloc’s rules designed to maintain a level-playing field and competitiveness for digital platforms. The adoption of Meta’s “pay or consent” model in 2023 raised concerns among several European data watchdogs.
The European Data Protection Board (EDPB) issued an opinion in April stating that platforms charging a fee for accessing an equivalent version of their services without personalised ads “should give significant consideration to offering an additional alternative.” In response, Meta proposed lowering its base subscription fee from €9.99 to €5.99 to ease regulators’ concerns in March. However, the Commission maintains that Meta’s model does not offer a real choice for users.
“We want to empower citizens to be able to take control over their own data and choose a less personalised ads experience,” said Margrethe Vestager, the Commission’s executive vice-president and competition policy chief.
She added that the Commission’s investigation, launched at the end of March, seeks to ensure that rivals can compete in the digital advertising market, where gatekeepers like Meta have been accumulating personal data of millions of EU citizens over many years. The investigation aims to conclude within the next 12 months.
