Meta Platforms’ (META) no-ads subscription service may still be in breach of European Union (EU) consumer and privacy laws, in addition to antitrust rules, a consumer group has said.
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The European Consumer Organisation (BEUC) issued the warning on Thursday, January 23rd, as it urged regulators to act against the company, though it comes at a time when EU regulators may be given pause for thought by the new Trump administration.
Specifically, the group said it had written to EU enforcement authorities to share concerns that the Facebook and Instagram owner’s latest pay-or-consent policy in the EU may be infringing consumer and data protection law as well as the antitrust-facing Digital Markets Act.
It said the policy was confusing to users, failed to offer consumers the chance to fully and freely consent to their data being used while META never minimized the data it collects, and that the company degraded the service for those who did not consent to sharing personal data.
META Policy Updates Fail to Assuage Concerns
For context, META late last year rolled out a second version of its pay-or-consent policy after the initial policy triggered the opening of investigations by European authorities.
META’s original pay-or-consent mechanism, which was rolled out in November 2023, required Facebook and Instagram users to either consent to the processing of their personal data for advertising purposes or pay a fee in order not to be shown advertisements based on their personal data.
In July last year the EU said the policy was in breach of its rules and META would potential fine of up to 10% of its global revenue if confirmed.
Following this, in November, the latest policy update saw META significantly reduce the price of subscription for no ads, and offered people in the EU an additional new choice to use Facebook and Instagram for free with fewer personalized ads. The company said these, among some other changes, “go beyond what’s required by EU law.”
However, despite the updates the BEUC said the latest version still fails to address the “fundamental problems.”
“It is important for consumer and data protection authorities and the European Commission to quickly investigate Meta’s latest policy and, if needed, take immediate and effective measures to protect consumers,” said BEUC Director General Agustín Reyna.
The warning from the group comes after it was reported the EU was reassessing several investigations into big tech giants including META due to the new White House administration. Before the inauguration, META boss Mark Zuckerberg called on the president-elect to stop the EU fining U.S. firms.
Is META a Good Stock to Buy?
Overall, Wall Street has a Strong Buy consensus rating on META stock, based on 40 Buys, three Holds and one Sell. The average META price target of $689.73 implies around 13% upside from current levels. Shares of META have risen 62% in the past year.
