EU privacy body adopts view on Meta's controversial 'consent or pay' tactic

Incoming guidance by an expert steering body on European Union data protection law could have major implications for Meta's advertising business model. The European Data Protection Board (EDPB) has decided that large platforms such as Facebook and Instagram cannot force a "binary" pay or consent choice on users, Politico reported on Wednesday, citing two people with direct knowledge of the decision.

Yet, a binary choice (AKA "consent or pay") is exactly what Meta wants to enforce on users in the region. The decision looks set to leave Meta with no option but to reform its business model to comply with EU law, which would mean giving users in the bloc the ability to deny its tracking.

The EDPB has been meeting this week to discuss adopting an opinion on the so-called "consent or pay" model following a request made back in February by a trio of concerned data protection authorities. A spokeswoman for the EDPB confirmed to TechCrunch that it adopted an opinion on "consent or pay" on Wednesday morning, saying it will be published later today. However, she would not confirm the substance of the decision, saying, "We are not in a position to comment on the content of the opinion before the opinion is published."

After EU regulators and courts overturned two prior legal bases Meta had claimed for processing people's data for ads, the company went on to launch a controversial subscription offer in the EU last fall. The company claimed its offer constituted valid consent under the bloc's General Data Protection Regulation (GDPR), which regulates how personal data can be handled (including the need to have a valid legal basis for such processing).

However, the choice Meta gives EU users is a binary one: Either consent to its use of personal data for targeted advertising, or pay a monthly fee to access ad-free versions of its social networks. Meta initially set the monthly fee at €13 per mobile account, and later proposed to halve the cost. But privacy campaigners and consumer rights groups have continued to cry foul and file a raft of complaints, arguing the flaws of "consent or pay" run far deeper than Meta's chosen price-point.

Lawmakers and the European Commission have also waded into the fray. The latter is investigating whether Meta's use of the mechanism complies with the bloc's Digital Markets Act, which requires in-scope platforms to obtain consent to process user data for ads. It has also questioned Meta about its claim of consent under the Digital Services Act.

But the EDPB's opinion is critical for the core issue of whether Meta's mechanism complies with the EU's long-standing data protection framework. So the full detail of the opinion will be pored over when it's made public.

In its report, Politico cites part of the EDPB decision: "In most cases, it will not be possible for large online platforms to comply with the requirements for valid consent if they confront users only with a binary choice between consenting to processing of personal data for behavioural advertising purposes and paying a fee."

Privacy rights nonprofit noyb, which has been fighting the rise of "consent or pay" tactics on regional websites for years, seized on the development to trumpet a win against Meta. The organization also cautioned that it will need to analyze the full EDPB opinion in detail once it's available.

"Overall, Meta is out of options in the EU. It must now give users a genuine yes/no option for personalised advertising," said noyb's founder and chairman, Max Schrems, in a statement following Politico's report.

"[Meta] can still charge sites for reach, engage in contextual advertising and the like -- but tracking people for ads needs a clear 'yes' from users," Schrems added. He suggested a third option (i.e. not tracking, or not paying) could also, for example, entail Meta collecting revenue from sponsored posts or other types of paid content, just so long as there's no tracking or targeting of users involved.

Meta did not immediately respond to a request for comment on the development.