European Commission Also Fines Apple 500 Million Euros

European regulators said Facebook conducted an end run around privacy regulations by requiring users to pay a monthly subscription fee or else accept that their personal data would be fed to advertisers. The European Commission fined the social media giant 200 million euros.
See Also: Securing Data in the AI Era
The commission on Wednesday said Facebook courted the fine by not giving users a real choice between consenting to have their personal data combined for advertising and access to the social media network. The fine – along with a 500 million euro fine against Apple for failing to inform smart device users of alternative locations to download apps – is the first Europe has made under the Digital Markets Act. The 2022 regulation seeks to guarantee competition by checking the power of big tech companies to abuse their market power.
Facebook rolled out a subscription model in November 2023 to European users after European data protection authorities rejected the legal justifications put forward by the company to justify personal data collection for the purposes of delivering personalized advertising. Critics of behavioral advertising say it violates a right to privacy unless explicitly authorized by users who have the ability to continue to use online services even if they reject web browsing tracking (see: EU Data Regulator Threatens Meta’s ‘Pay or Okay’ Model).
The company in November 2024 modified its pay-or-consent model by allowing users to select a no-cost option to see “less personalized ads.” The option “that allegedly uses less personal data to display advertisements,” as the commission put it, is still being evaluated by the commission. The Wednesday fine only covers Facebook’s behavior from the March 2024 date of Digital Markets Act compliance to November 2024.
Henna Virkkunen, European executive vice president for tech sovereignty, security and democracy, said the fine reflects European commitment to “protect the rights of citizens and innovative businesses in Europe.”
Facebook parent Meta criticized the fine and vowed to appeal, stating the commission is “attempting to handicap successful American businesses.”
“This isn’t just about a fine; the commission forcing us to change our business model effectively imposes a multi-billion-dollar tariff on Meta while requiring us to offer an inferior service,” said Joel Kaplan, Meta’s chief global affairs officer.
The company has two months to bring its processes under compliance under the DMA.
European privacy advocate Max Schrems – who has launched several successful legal challenges against Facebook – predicted Thursday the commission will force greater changes at Facebook. The social media giant’s “‘less ads’ option is just a smokescreen,” he said. “Meta has simply created a ‘fake choice,’ pretending that it would overcome the illegal ‘pay or okay’ approach.”
Apple also vowed to appeal the decision, accusing the commission of “unfairly targeting Apple” in decisions “that are bad for the privacy and security of our users, bad for products, and force us to give away our technology for free.”
