1 week Ago By Kamya Pandey
Explainer Briefly Slides The European Commission has fined Meta EUR 797.72 million for tying its classified ads segment Facebook marketplace with its social media service Facebook. The authority says that as a result of this tie-in, the company ends up regularly exposing its users to Marketplace service, whether they like it or not.
“The Commission found that competitors of Facebook Marketplace may be foreclosed as the tie gives Facebook Marketplace a substantial distribution advantage which competitors cannot match,” the authority noted in its press release announcing the fine. Further, the commission holds that Meta “unilaterally” imposes unfair trading conditions on other online classified ads service providers who advertise on Meta platforms (especially Facebook and Instagram). “This allows Meta to use ads-related data generated by other advertisers for the sole benefit of Facebook Marketplace,” the authority mentions.
Meta’s troubles with the Facebook Marketplace: The European Commission first initiated formal proceedings against Meta for anti-competitive practices in 2021 . Based on its investigation, the commission found that Meta is a dominant player in the market of online display ads (through FB Marketplace) and ties it up with yet another dominant platform, its social media service. Further, it found that terms and conditions Meta enforces on competitors to use their ad related data are unjustified and disproportionate.
As such, the commission sent a statement of objections to Meta in December 2022, to which Meta responded by 2023. Besides the EU, the UK have also held Meta liable for anti-competitive behavior with regards to the Marketplace feature. In 2021, UK’s Competition and Markets Authority (CMA) also intitated an investigation into Facebook Marketplace because it was concerned that Meta was using competitors’ ad data to improve its own products.
As a result of this investigation, in May 2023 , Meta offered not to not use other businesses’ advertising data for improving its Marketplace service in the UK. The company also began providing advertisers the option to opt out of allowing it to use their advertising data to improve/develop the Marketplace feature. Also read:.
