European Commission issues Meta with hefty fine for tying Facebook and Marketplace
The European Commission (EC) is at it again, issuing another hefty fine to a US tech giant. This time it's Meta and the fine is â¬797.72 million (about $843.1 million).
The reason has to do with Meta basically shoving Marketplace down every Facebook user's throat, whether they wanted it or not. This, the EC states, constitutes imposing unfair trading conditions on other online classified ads service providers.
Basically, the only classified ads you're likely to see on Facebook are from Meta through Marketplace, and that leaves out any possible competitors because of the way it's tied into Facebook. But wait, there's more. The EC also says Meta is unilaterally imposing unfair trading conditions on other classified ads providers who advertise on its platforms, which allows Meta to use ads-related data generated by other advertisers "for the sole benefit of Facebook Marketplace".
The EC's investigation found that Meta is "dominant" in the market for personal social networks as well as in the national markets for online display advertising on social media, hence why its behavior was investigated.
The level of the fine was set with regard to "the duration and gravity of the infringement, as well as the turnover of Facebook Marketplace to which the infringements relate". Aside from the fine, Meta is also now obliged to "bring the conduct effectively to an end and to refrain from repeating the infringement or from adopting practices with an equivalent object or effect in the future".
Unsurprisingly, Meta isn't happy and has vowed to appeal the decision in order to "promote better outcomes for European consumers", as it's "built Marketplace in response to consumer demand". The company says the EC's decision "ignores the market realities" and "will only serve to protect incumbent marketplaces from competition".
Meta's main and possibly most compelling argument seems to be that "Facebook users can choose whether or not to engage with Marketplace, and many don't". "The reality is", Meta says, "that people use Facebook Marketplace because they want to, not because they have to".
Meta also says it doesn't use advertising data from rivals to compete against them with Marketplace, having built systems and controls to ensure that.