Jan 4, 2023 - Technology

Meta fined over $400 million for its targeted ad practices

The Meta (formerly Facebook) logo marks the entrance of their corporate headquarters in Menlo Park, California on November 09, 2022

The Meta logo at the entrance of their corporate headquarters. Photo: Josh Edelson/AFP via Getty Images

Meta, the parent company of Facebook and Instagram, illegally required users to agree to personalized and targeted ads and was fined $414 million for violating European Union rules, Ireland's Data Protection Commission (DPC) said Wednesday.

The big picture: Meta will pay about $223 million for violating privacy rules on Facebook and about $191 million for its practices on Instagram, the regulator said.

Driving the news: The ruling came after a pair of 2018 complaints alleged Meta, formerly called Facebook, did not properly comply with the General Data Protection Regulation (GDPR) rules.

  • Facebook and Instagram had users accept terms of service that effectively forced users to agree to new terms and conditions that allowed their data to be used for personalized ads if they wanted to continue using their accounts, the regulator said.
  • The DPC said that the language made it so "users had insufficient clarity as to what processing operations were being carried out on their personal data."
  • The GDPR bans businesses from keeping personal information without permission from an EU citizen.

What they're saying: Meta said in a blog post published Wednesday that it plans to appeal the decision, suggesting that Facebook and Instagram are "inherently personalized."

  • "It would be highly unusual for a social media service not to be tailored to the individual user," Meta said.
  • "We strongly believe our approach respects GDPR, and we're therefore disappointed by these decisions and intend to appeal both the substance of the rulings and the fines," Meta said.
  • The company said it can continue to provide personalized advertising across the EU.

Thought bubble via Axios' Ashley Gold: The fines may be large and hint at a future where targeted advertising is banned, but the fact that they stem from 2018 complaints shows how slow the process will be for any real shifts to how Meta operates.

What's next: The ruling could force Meta to make changes to its advertising business in the European Union, the New York Times reports. No specifics of how Meta must comply moving forward were given.

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