EU's decision to restrict Facebook and Instagram's infamous marketing policies will significantly affect Meta's profits

As per recent reports, the European Data Protection Board (EDPB) has rejected Facebook, Instagram owner Meta's unwelcome tactic to bypass the General Data Protection Regulation (GDPR) and provide personalized advertisements without consent.

Both Facebook and Instagram are now required to feature an opt-in option for data collection-based advertisements, which users can reject or accept. This ruling will be applicable in all European countries, bringing Meta down to a level playing field with its competitors in the region and restricting its profit spectrum.

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EDPB's latest restriction is likely to negatively impact Facebook and Instagram as well as revenue for Meta

Needless to say, Meta will now have to comply with the rules that other social media platforms have been following since 2018. This will ensure a fair competitive environment for all the platforms besides Facebook and Instagram, both of which have now received huge blows to their profiting scheme.

Moreover, the DPC, in association with EDPB's insistence, has slapped Meta with a whopping €390 million in total fines for not following the GDPR, delaying its implementation, and conspiring to introduce an arrogant diversion in the official clauses. According to the official statement from DPC, Facebook is facing €210 million in fines, while the remaining €180 million has been imposed on Instagram.

Previous reports have confirmed that Meta has paid over €900 million in fines for violating the data protection scheme in Europe over the years. Meta Ireland will most likely appeal this costly decision in Irish courts next, but the expected outcome doesn't really favor the company.

EDPB's decision will help other social media platforms like Twitter and Snapchat step up their profit game in Europe. Advertisers who comply with the GDPR will no longer have to face Facebook and Instagram's illegal bypass as competition anymore.

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How did Meta's advertising scheme push the company into an expensive mess?

While most social media platforms implement data-driven marketing schemes, Meta's approach to utilizing and selling user data is fairly aggressive, something that has garnered massive public attention over its existence.

With EDPB's formation and the GDPR coming into effect in 2018, many advertisers had to curb their policies and introduce consent options for users who wanted to opt-out of user data-driven marketing. However, the scheme didn't impose restrictions on contextual advertisements or marketing policies based on popular content or search habits.

Even then, Meta chose not to comply with the decision and introduced the required consent clause for personalized advertisements and data collection in the website's terms and conditions, leaving users with no way to reject the clause and use Facebook or Instagram simultaneously.

NOYB, an NGO for digital rights in Europe, filed complaints based on two user reports back in 2018, officially stating Meta's immoral methods. This led to several official investigations led by the Irish DPC, the organization in charge of the GDPR's compliance.

However, the Irish DPC has also been accused of 'siding' with Meta Ireland and helping the company bypass official regulations for personalized advertisements. This could explain how Meta managed to pull off the bypass for four years after the GDPR was established.

Meta's plan to nullify official legalities was rejected by several European DPAs over the years, leading to the final decision on January 4, 2023. The punishment, although delayed, has been applauded by the community. Furthermore, a third ruling for a complaint regarding Whatsapp's data usage policy is yet to be addressed, leaving another possible breakdown and greater fines for Meta.

Meta's alleged collaboration with the Irish DPC reportedly caused a delay in the ruling even after repeated investigations. However, the harsh final ruling has possibly paid off for all the inconveniences and illegal advancements the social media and tech giant has caused over the years.