Meta's ad-free subscription service in Europe faces yet another regulatory hurdle after the Consumer Protection Cooperation Network issued the company with a notice to explain and potentially revise its marketing of the option, which it says is currently misleading.

To summarize, last November Meta's ad-free subscription package was rolled out in Europe, which will enable users in the EU to pay a monthly fee for the chance to opt out of both ads and data tracking-compliant with new EU permission requirements. The concept here is that this may allow Meta to still comply with those new regulations while it continues to receive its revenue stream.

But within hours, privacy activists criticized the proposal, claiming Meta was predatory in forcing people to pay for an offering that should be free. The EU law requires that users have "absolute control" over how they want their data used; the argument seems to be that the money being made from this feature is what the legislation does not provide.

After an investigation last month, Meta's ad-free subscription plan was discovered not to be in line with the Digital Markets Act, and it was able to respond before the risk of fines regarding the program.
 
And today, the CPC has determined, as part of another investigation, that the ad-free package offered by Meta doesn't constitute adequate information to users about what they do.

According to the determination:

The consumer protection authorities assessed several elements that could constitute practices which are misleading or aggressive, namely whether Meta provided consumers upfront with true information, clear and sufficient. They analyzed whether this information allowed consumers to understand the implications of their decision to pay or to accept the processing of their personal data for commercial purposes on their rights as consumers. Besides, CPC representatives are concerned that many customers may have felt compelled to make between the two varieties quickly enough, fearing losing access to their accounts and lists of contacts right away.

The view of CPC is that the ad-free service offered by Meta gives a misleading impression through its language, putting undue pressure on the users to take up the subscription plan or not while, at the same time, the overall documentation around the package is confusing as well by Meta.
It compels users who have never had to pay to use Facebook/Instagram, and who for many of whom Facebook/Instagram has been a fundamental part of their social lives and interactions, to act now, without a pre-notice, sufficient time and genuine chance to determine how that might impact on their contract with Meta, by not allowing them access to their accounts before their choice.

Which is an odd argument. At play here is that the CDC and the EU Commission both appear to be conceding that Facebook and/or Instagram is an essential utility for connection. Yet this is not a government-owned entity, it's a business, and therefore it has the right to run their business as they so choose.

As such, I'm not quite sure how either can argue legally that Meta cannot charge for its services, should these new requirements impact its bottom line. But both camps seem to suggest that Meta needs to keep on offering services for free, be clear that one can avoid extra payment, and yet restrict use of personal data.

It seems, then that Meta does have a case to put forward in support of its initiative though Meta is looking to work with EU authorities, to maintain business relationships.

Meta has already offered to half the price of its ad-free package to appease the EU regulators.

It's actually a pretty complicated case, and it's also very interesting to challenge the new regulations of the EU because a ruling in Meta's favor could create a precedence for cases like this from now onwards. Which may water down the whole Digital Markets Act (DMA) something EU authorities would be eager to push back on.

At any rate, this is another challenge to what Meta will be able to offer in the EU.

Meta now has till September 1st 2024 to reply to CPC's notice.