The Competition and Markets Authority (CMA) in the UK has announced that social media giant Meta has offered to limit its use of other businesses’ advertising data for its Facebook Marketplace service. This decision was made to address the regulator’s competition concerns. The CMA said it was inclined to accept the commitments, which include advertisers being able to opt-out of allowing their data to be used to improve the Facebook Marketplace classified ads platform. CMA executive director of enforcement Michael Grenfell said that reducing the risk of Meta unfairly exploiting the data of businesses who advertise on its platform for its competitive advantage could benefit many UK businesses who advertise there. The CMA cited an example of Meta being able to use data derived from a user’s engagement with ads on Facebook to deduce if they were interested in trainers, which could then influence listings for shoes to that user on Facebook Marketplace.
According to the CMA, a consultation on Meta’s proposals will close on June 26. Earlier this week, Meta sold the animated images platform Giphy to Shutterstock for $53 million, in cash. This sale occurred a few months after the Facebook owner had agreed to divest the company on competition concerns. Last year, Britain’s competition regulator ordered Meta to sell Giphy due to fears that it could deny or limit competitors such as Snapchat and Twitter access to the target’s content. Meta had reportedly paid $400 million for New York-based Giphy in 2020. A year later, the deal was challenged by Britain’s Competition and Markets Authority, and its successful campaign was the first time a regulator had forced a US tech giant to sell an already acquired company.
In January, Facebook had asked a London tribunal to block a collective lawsuit valued at up to GBP 3 billion over allegations that the social media giant abused its dominant position to monetize users’ personal data.
The CMA’s announcement is in response to concerns regarding the use of other businesses’ advertising data by Meta for Facebook Marketplace. This commitment would limit the use of such data and allow advertisers to opt-out of using their data to improve the Facebook Marketplace classified ads platform. By making this offer, Meta is seeking to address the CMA’s concerns about unfair exploitation of data for its own competitive advantage.
The CMA cited an example of how Meta could use data derived from a user’s engagement with ads on Facebook to deduce whether they were interested in trainers, which could then influence listings for shoes to that user on Facebook Marketplace. The consultation on Meta’s proposals will close on June 26, and the CMA has stated its belief that these commitments will address its concerns.
In recent news, Meta sold Giphy to Shutterstock for $53 million, following a decision by the UK’s competition regulator last year to order its sale over fears of limiting competitors’ access to its content. The successful campaign to force the US tech giant to sell an already acquired company was a first for regulators. Facebook has also been facing a collective lawsuit valued at up to GBP 3 billion over allegations that it abused its dominant position to monetize users’ personal data.
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