Big Tech Faces Hefty EU Fines: Apple and Meta Hit with Millions
EU imposes hefty fines on Apple and Meta, totalling millions of dollars - EU imposes substantial fines on Apple and Meta for regulatory breaches
Dive into the latest bust-up between tech giants Apple and Meta and the EU Commission, as they're slapped with fines totaling over half a billion euros.
The Showdown
The tech titans find themselves in hot water, accused of flouting Europe's digital laws. They have the option to appeal, with Apple planning a legal challenge.
The Charges
At the heart of the matter is the Digital Markets Act (DMA), aiming to prevent dominant market positions from harming smaller providers. This is the EU Commission's first time levying fines under the DMA.
Apple protests against the Commission's 'hard-sell', claiming it's being forced to give away technology for free without fair reciprocation. Despite numerous discussions, the Commission keeps moving the goalposts.
A Stormy EU-US Relationship?
The fines could add fuel to the ongoing tensions between the US and the EU. Republican chairman of the US Federal Trade Commission, Andrew Ferguson, compared the DMA to a hidden tax on American companies.
Despite the EU Commission's insistence that proceedings against American tech companies are unrelated to current trade disputes, concerns persist. Recently, EU Commission President Ursula von der Leyen proposed taxes on advertising revenues for large online platforms.
Limiting Offers and Choices
The case against Apple centers around preventing app developers from offering consumers alternatives outside the app store. As a result, consumers are deprived of cheaper options because the company locks down information about such offers.
Meta, on the other hand, was disciplined for its "pay-or-consent" model, which contravenes EU law. The model forces users to either pay for an ad-free version or accept personalized ads without being offered a service that uses less of their personal data.
Meta responded with a new option using less personal data in 2024, though the Commission is still considering its compliance. The fine pertains to the period from March 2024 to November 2024, during which the alleged violation occurred.
The Stakes Are High
Non-compliance with the DMA can lead to stiff penalties - fines of up to 20% of global annual turnover for repeat offenders. For instance, Apple and Meta reported annual turnovers of approximately 370 billion euros and 165 billion US dollars, respectively.
(Enrichment Insights)
- Apple's violations involved breaching the DMA's anti-steering obligation by restricting app developers from informing consumers about alternative offers outside the App Store, thereby limiting competition and consumer choice[1][2].
- The Commission ordered Apple to remove these restrictions and halt similar non-compliant conduct[2][4].
- Meta's offenses included its "consent or pay" advertising model and breaching the DMA obligation to offer consumers a choice between personalized ads and a service using less personal data but otherwise equivalent[1][2][5].
Note: This article has been updated.
- Apple
- EU
- Millions in fines
- EU Commission
- The EU Commission levied fines against tech giants Apple and Facebook for flouting the Digital Markets Act (DMA), accumulating millions in penalties as a result.
- Apple, in response, plans to challenge the Commission's decision, alleging a 'hard-sell' tactic that forces the company to give away technology for free without fair reciprocation.
- In the case against Apple, the EU Commission found the company in breach of the DMA's anti-steering obligation by restricting app developers from informing consumers about alternative offers outside the App Store.
- Meta faced disciplinary action for its "pay-or-consent" model, which contravenes EU law by forcing users to either pay for an ad-free version or accept personalized ads without offering a service that uses less of their personal data.
