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Meta Defends Charging Fee For Privacy Amid Showdown With EU (arstechnica.com) 66

Posted by BeauHD from the privacy-inclined dept.
An anonymous reader quotes a report from Ars Technica: Meta continues to hit walls with its heavily scrutinized plan to comply with the European Union's strict online competition law, the Digital Markets Act (DMA), by offering Facebook and Instagram subscriptions as an alternative for privacy-inclined users who want to opt out of ad targeting. Today, the European Commission (EC) announced preliminary findings that Meta's so-called "pay or consent" or "pay or OK" model -- which gives users a choice to either pay for access to its platforms or give consent to collect user data to target ads -- is not compliant with the DMA. According to the EC, Meta's advertising model violates the DMA in two ways. First, it "does not allow users to opt for a service that uses less of their personal data but is otherwise equivalent to the 'personalized ads-based service." And second, it "does not allow users to exercise their right to freely consent to the combination of their personal data," the press release said.

Now, Meta will have a chance to review the EC's evidence and defend its policy, with today's findings kicking off a process that will take months. The EC's investigation is expected to conclude next March. Thierry Breton, the commissioner for the internal market, said in the press release that the preliminary findings represent "another important step" to ensure Meta's full compliance with the DMA. "The DMA is there to give back to the users the power to decide how their data is used and ensure innovative companies can compete on equal footing with tech giants on data access," Breton said. A Meta spokesperson told Ars that Meta plans to fight the findings -- which could trigger fines up to 10 percent of the company's worldwide turnover, as well as fines up to 20 percent for repeat infringement if Meta loses. The EC agreed that more talks were needed, writing in the press release, "the Commission continues its constructive engagement with Meta to identify a satisfactory path towards effective compliance." Meta continues to claim that its "subscription for no ads" model was "endorsed" by the highest court in Europe, the Court of Justice of the European Union (CJEU), last year.

"Subscription for no ads follows the direction of the highest court in Europe and complies with the DMA," Meta's spokesperson said. "We look forward to further constructive dialogue with the European Commission to bring this investigation to a close."

Meta rolled out its ad-free subscription service option last November. "Depending on where you purchase it will cost $10.5/month on the web or $13.75/month on iOS and Android," said the company in a blog post. "Regardless of where you purchase, the subscription will apply to all linked Facebook and Instagram accounts in a user's Accounts Center. As is the case for many online subscriptions, the iOS and Android pricing take into account the fees that Apple and Google charge through respective purchasing policies."
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Meta Defends Charging Fee For Privacy Amid Showdown With EU More

Meta Defends Charging Fee For Privacy Amid Showdown With EU

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  • Meta should leave the EU (Score:5, Insightful)

    by cygnusvis ( 6168614 ) on Monday July 01, 2024 @02:23PM (#64592889)
    If its free the user is the product. If the EU says the user cannot be the product, then it cannot be a free service. Meta's entire business model is just not compatible with the EU anymore.
    • Please do. I will only make further improvements to the EU.

    • Re: (Score:3)

      by tlhIngan ( 30335 )

      Then they need to look at Spotify, the #1 radio service in the world. Pretty sure they don't offer a free tier of service out of the generosity of their hearts.

      Oh wait, Spotify is based in an EU country. Nevermind!

    • Re: (Score:2)

      by AmiMoJo ( 196126 )

      They could just use non-targeted ads. Or target based on the page content, rather than the user's personal data.

      • Re: (Score:2)

        by chefren ( 17219 )

        Yes, the problem is that ads are less effective this way and so Facebook will make less money.

        • The real problem, is that its well known in marketing circles that facebook ads are not effective period. People just dont click on ads on that site unless its accidental. And accidental ads dont convert to sales.

          The companies buying the ads are as big a chump as the people they are trying to target. This applies to all social media by the way.

          Its an entire industry that needs to die, and urgently so. (Both social media, and advertising. A pox on both their houses for destroying the internet)

  • I've not read the original article (Score:3)

    by Teun ( 17872 ) on Monday July 01, 2024 @02:40PM (#64592931)
    I've not read the original article but from the above I guess that even with a subscription Meta would still collect your data and monetize it via those you connect with.
    And why is WhatsApp not mentioned, I believe they combine the call data with their other information from Facebook and it's ilk.

  • Seriously? (Score:5, Interesting)

    by ls671 ( 1122017 ) on Monday July 01, 2024 @02:47PM (#64592943) Homepage

    It's a nice quiet privacy you have there on your store shelf. It would be a shame if anything happened to it if you didn't pay us for protection.

    • You're not paying for protection. You're paying for FB service. Either with your money, or with your data. The choice is yours. If you can find someone to buy your data for more than FB subscription, do that and pay FB. Or do what I do, never use FB products.

  • Pay in perpetuity? (Score:5, Interesting)

    by sinij ( 911942 ) on Monday July 01, 2024 @02:59PM (#64592959)
    It is not clear to me what exactly paying that fee buys you. Do you pay them to not collect data on you or do they collect data anyways but start using it once you stop paying?

  • Targeted Ads != Ads (Score:5, Insightful)

    by Matheus ( 586080 ) on Monday July 01, 2024 @03:04PM (#64592973) Homepage

    The business model of free-with-ads vs. pay-and-no-ads has been around for ages (Most notably the entire Cable TV industry back in the 80s/90/s).. it's largely how the entire internet landscape blossomed and for the most part consumers are fine with that "free enough" concept.

    That is not what users are opting out of and not the point of this law. A user opting for privacy / opting out of "targeted ads" is exactly that -> Opting to return to the early days of the tech where the ads shown to you were no more targeted than the print ads in a paper or magazine. Not being intimately familiar with Facebook's code this should be trivially to implement as their software already has to account for a new user with no data in their profile yet. Facebook is going to show you ads based on default distribution metrics not tied to your personal data. The fact Facebook is trying to conflate the 2 is ridiculous. Sorry you don't need my data purely to show me ads only to show me 'better' ads and frankly the Facebook algorithm is pretty terrible anyway so them knowing more about me isn't that much "better" anyway...

    It's that simple. Period.

    • And it's MY computer, and I pay for MY internet connection, so I get to decide what I see, so I use ad blockers, block trackers, run PiHole etc.
      I also have a junk mail address that I go to once a month, select all messages and delete them.
      NO business gets my real email address anymore, they can no longer be trusted.

      And if they go "Pay or go away", I go do something else.

      It's that Simple. Period.

      • And it's their product, for sale under their terms. If you don't want the product under those terms, don't use it. Your connection to the internet isn't much different than the road system that leads to your home. The existence of your home and your computer doesn't give you carte blanche to go grab anything from the world and drag it into your space.

        Your ad blockers are a convenience that you use to make a product that you don't want to pay for palatable for you when you steal it.

        I fully agree with people

        • It's the tracking.
          I have given no social media site permission to track me, and yet they do it anyway even though I am NOT a customer.
          Think of it being like a shop sending an employer to photograph you, your car, your house, your family, where you work, where your kids go to school, what you buy who you vote for, your credit card number, etc etc etc. Does the fact that you bought some gum there give them that right ?

          THEN when all that information gets stolen, its not their fault and they deny any respo

          • Okay, that's a very good nuance. I think the core point still stands - if you block the ads and don't want to pay for ad-free, avoid the site. But I completely understand the ad-blocker as tracking prevention. Makes perfect sense to me.

            • EVERYWHERE you see the [f] and other brand "gifs" on a web site, they have vacuumed up all the info about what you look at etc etc etc. They buy information from other sites etc.
              They invasively target you and everyone around you
              How about if I am not a customer its illegal the track me, buy information about me, have shadow profiles about me. And WHEN (not if) they get hacked and have personal information stolen they be liable for US$1 Million each

    • Re: (Score:2)

      by sconeu ( 64226 )

      Thank you. I came here to say something similar.

      Meta is creating a false dichotomy. It's not "Pay+No Ads vs. Free+Ads". What the EU is asking for is "Free+TargetedAds vs Free+GenericAds"

      • Generic ads produce less revenue, so that means more ads than targeted ads. Generic ads could become be so heavy that people would stop using it. Imagine they went with how some free games do it, they make you watch ads periodically before they allow you to use it, but since those ads are now generic, you must watch them very often (forced ad watch for every n clicks, or x scrolling distance - adjusted based on average ROI on the ads to recover subscription equivalent).

    • I don't instead why people would want random ads for shit they would never buy under any circumstances, rather than add for shit they might actually buy.

      I mean, if you have to sit through 3 hours/day (example total daily ad exposure) of bull shit, seems like people would rather sit through relevant bullshit than irrelevant bullshit.

      • Just because you don't care how your personal data is used doesn't mean that nobody else should be allowed to have a say. Clearly, EU voters have had their say, and the government is backing them on that. It must be nice.

      • Maybe you'll think different when a burglar gets ahold of your data and knows what your schedule is. But at least the ad company knows how best to manipulate you into buying their shit, saving you from looking at less effective ads.

        • Yeah, sure. Because......hell, I don't even know how to respond to that nonsense.

          If a burglar is desperate enough to break into THIS house, rather than all the other houses that have way better shit than I do, I guess...more power to him.

          But I will post "my schedule" right now, for all to see. Here it is:

          Monday-Friday: rarely leave the house.

          Saturday and Sunday: often don't leave the house. But if I do, it's going to Costco and Aldi. House is will be vacant roughly 10AM-1PM.....but really not very frequent

      • I might be happier seeing targeted ads if the targeting algorithms were even a little bit "smarter". I've never really used FaceBook, but my experience with targeted Google ads so far has been that occasionally I search for one thing one time that happens to be for sale somewhere (I'm usually not even planning to buy it), and suddenly every Google ad on every site I visit for weeks (sometimes months) is plastered with the same ad dozens of times and there's no other ad in sight. If that company is paying pe

    • How is this different than Spotify, which also offers a targeted (or so they advertise to... advertisers) ad in lieu of payment service?
    • Cable TV was free in the 80s/90s where you lived? Where was that? I never ever had a free cable TV service, even though the programming was full of ads.
  • Sounds like Zuck is committing old fashion extortion in a new way to me.

  • They are correct in saying:

    * We provide a service that costs money to provide.
    * You can use our service for free if you allow us to track you and show you curated ads
    * Or you can pay us a fee, and see non-curated ads

    (It's not clear to me whether the fee means they don't sell you to advertisers in some other way - it would be typical of Meta to weasel around on that)

    If the fee is unacceptable, it means Meta is being asked to provide a free public service.
    Governments can do that, and businesses can choose to

    • Re: (Score:2)

      by sconeu ( 64226 )

      What about, "I'm fine with ads. But don't track me, and just show me whatever random ad comes up next in the rotation"?

      • Re: (Score:2)

        by mccalli ( 323026 )
        The advertisers themselves won't pay as much for that, so Meta's income goes down. I actually think this is right - I pay for services where in order to not get the adverts, and I think it's a "money where your mouth is" moment.

        I'm not a Facebook user (would like to say I'm not a Meta user but sadly WhatsApp in dominates in the UK) but I think it's completely fair for them to say "our business model assumes making $x from you, if we lose these feature we lose $y's worth of advertiser payment, therefore I
        • They do for printed media, on air radio and TV, bill boards , etc etc etc.

          They also will when its in their own best interests, either pay for them or have none.
          • All your examples target specific geographical areas (different ads play in different places for the same content), specific income or interest groups, etc. Heck, with digital cable boxes, smart TVs, etc, you actually can get personalized ads based on your watching patterns, your address, other information the cable company or TV company or others have collected on you. EU wants no data collection on users, so you cannot even geo target ads based on users IP address or GPS location.
            • Of course you can roughly geolocate them by IP, just not to the granular individual IP they want to.
              This is how it operated BEFORE the race to scoop up everyone's details.
              The EU (and other countries) are recognising the harm this does to their populace and are starting to fight back. This is NOT "anti-American", it just so happens the biggest and worst offenders are American companies who have been able to "influence" local law makers to make it easy for them to behave the way they do.

              However the USA i
              • I didn't think that it was anti-American at all. Personally I prefer to have a choice whether and to whom I sell my data. I never had, nor plan to have an FB account, my digital footprint is very minimal, but that is by choice, not because of legal restrictions. However, if majority of people of EU prefer to not have this choice, they can vote in such restriction - EU citizens are not allowed to sell, or otherwise trade their personal information. This would make it illegal for EU citizens to trade their pe
                • And women in the EU can get abortions, not true in all of the USA. Which is the greater imposition to freedom of choice ?
                  • Both, IMO, are limitations of personal freedoms and overreach of government. That said however, that is how democracy works - majority forces their will on minority. This is why democracy does not scale, once it becomes too large there is nowhere to move to escape the 50.01%. We need smaller democracies and mobility between them.
      • Untargeted ads bring a lot less revenue. You might have to be drowned with ads to generate equivalent revenue of moderate targeted ads.

    • Facebook could always provide ads without tracking. Duckduckgo lives on it.

  • If they offer this in North America, I would pay... but not that much. $10.50/month is far too high. Try $15/year for absolutely no ads, "suggested content", or the like... just posts from people and groups that I follow, in strictly chronological order. Do it, Meta!

    • They likely make $10 per tracked user (I remember an estimate from many years ago was $7.50 per user), so why would they give up $120 revenue for $15?

  • So if facebook can't track users, they would be forced to charge less for untargeted ads. Advertisers would be forced to spray more untargeted ads at everyone, to get their ads to the targeted audience. In the end, it leads to even *more* ads.

    • Re: (Score:3)

      by AmiMoJo ( 196126 )

      It's up to Facebook. They can have more ads, or they can make less money, or they can close their EU operation.

      "We can make more money by raping your privacy" is not a valid business model here.

      • Of course it's up to facebook, my statements were based on how the market works in general. Facebook, if anything, is not ignorant of how the market works.

        It's fashionable to criticize companies like facebook for "raping" privacy. But the truth is, people willingly give it up. The minute a company tries to charge money--even just a small fee--in exchange for privacy, most people refuse to pay the cost. They choose the free version with the privacy invasion. By doing so, people have established that they do

      • They do have a privacy service, it's just not free. EU is free to ban their citizens from selling their personal information to anyone (whether for money, free goods or services, it doesn't matter).

  • If Meta isn't allowed to run targeted ads in the EU, it might not be cost-effective to keep providing the service for free. The only viable business model would be to make all Europeans pay for ad-free Facebook, Instagram, and WhatsApp.

    That would be a disaster for European small/medium businesses, who rely on Meta ads to reach their customers.

  • Donâ(TM)t make me defend Facebook, EU (Score:3)

    by Cinder6 ( 894572 ) on Monday July 01, 2024 @09:29PM (#64593673)

    I hate Facebook, to possibly an irrational degree. They are morally bankrupt, theyâ(TM)ve been a significant net negative to the world, and I would be more than happy to see them go out of business due to changing public preferences and increased awareness about their perfidy.

    It brings me no joy to say this particular move by the EU seems bonkers to me. Given how much more valuable targeted ads are than non-targeted ads, Facebook would have to dramatically increase the number of ads displayed, to the point that service quality (such as it is) would crater. Some quick figures I found online suggests that even $10/mo is a big reduction in ARPU.

    Would the EU accept a page thatâ(TM)s 90% ads? Would they accept if Facebook went pay-only? I genuinely donâ(TM)t know. Their actions feel less directed toward protecting users/businesses and more toward directing business models.

  • Facebook and instagram are totally useless.

    I've yet to encounter a person who does actual useful things on facebook and instagram beyond the usual representing some company.
    People use facebook and instagram for things which could be much easier to achieve with a "simple" forum. There's loads of companies out there where you can rent a forum for a monthly/yearly fee and have discussion on it.

    • Re: (Score:2)

      by dskoll ( 99328 )

      I use Facebook to book comedy gigs. It's pretty much the only way to get spots in most local comedy scenes.

      I also use it to keep in touch with family and friends who live far away without having to write dozens of emails. I would pay a modest amount ($15/year) to have a decent Facebook experience: No ads, content only from people/groups I follow, strictly in reverse chronological order.

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