noyb files GDPR complaint against Meta over “Pay or Okay”

Nov 28, 2023

noyb files GDPR complaint against Meta over “Pay or Okay”

Today, noyb filed a complaint against Meta with the Austrian data protection authority. European users now have the “choice” to either consent to being tracked for personalized advertising – or pay up to €251.88 a year to retain their fundamental right to data protection on Instagram and Facebook. Not only is the cost unacceptable, but industry numbers suggest that only 3 percent of people want to be tracked – while more than 99 percent decide against a payment when faced with a “privacy fee”. If Meta gets away with this, competitors will soon follow in its footsteps. Given that the average phone has 35 apps installed, keeping your phone private could soon cost around € 8,815 a year.

Another attempt to circumvent EU privacy laws. The European Court of Justice (CJEU) ruled in July that Meta’s handling of user data for personalized ads was illegal. But not only that: In January, the European Data Protection Board fined Meta €390 million for this violation and ordered the company to obtain users’ consent, based on a noyb complaint from 2018. In its next attempt to undermine EU law, Meta now wants to charge people for choosing a privacy-friendly setting. Since the beginning of November, Instagram and Facebook users have had to choose between paying up to €251.88 a year or having their personal data surveilled for targeted advertising.

“Freely given” consent at a high price? Under EU law, consent to online tracking and personalized advertising is only valid if it is “freely given”. This is to ensure that users only give up their fundamental right to privacy if it is their genuine free will to do so. Meta has now implemented the exact opposite of a genuinely free choice: Facebook alone will introduce a “privacy fee” of up to €12.99 per month if users do not consent to their personal data being processed for targeted advertising. Each linked account (such as Instagram) will cost another €8, making a total of €251.88 a year for one person using Instagram and Facebook. By comparison: Meta says its average revenue per user in Europe between Q3 2022 and Q3 2023 was $16.79. This equates to an annual revenue of just €62,88 per user – and puts the monthly fee way out of proportion.

Felix Mikolasch, data protection lawyer at noyb: “EU law requires that consent is the genuine free will of the user. Contrary to this law, Meta charges a “privacy fee” of up to €250 per year if anyone dares to exercise their fundamental right to data protection.”

3 to 10 percent want personalized ads – but 99.9 percent consent. All available scientific research suggests that so-called “Pay or Okay” systems are the antithesis of free consent and fundamentally affect the “free will” of users. For example, the CEO of the “Pay or Okay” provider contentpass stated that 99,9 percent of visitors agree to tracking when faced with a € 1,99 fee. At the same time, objective surveys suggest that only 3 to 10 percent of users want their personal data to be used for targeted advertising.

Max Schrems, Chairman of noyb: “When 3 percent of people actually want to swim, but 99.9 percent end up in the water, every child knows that it wasn’t a “free” choice. It’s neither smart nor legal – it’s just pitiful how Meta continues to ignore EU law.”

Data protection could soon cost €35,000 per family. If Meta is successful in defending this new approach, it is likely to set off a domino effect. Already now, TikTok is reportedly testing an ad-free subscription outside the US. Other app providers could follow in the near future, making online privacy unaffordable. According to Google, the average person has 35 apps installed on their smartphone. If all of these apps followed Meta’s lead and charged a similar fee, people would have to pay a “fundamental rights fee” of €8,815.80 a year. For a family of four, the price of data privacy would rise to €35,263.20 per year - more than the average full-time income in the EU. Obviously, these figures become even more extreme in EU Member States with lower average incomes.

Max Schrems: “Fundamental rights are usually available to everyone. How many people would still exercise their right to vote if they had to pay € 250 to do so? There were times when fundamental rights were reserved for the rich. It seems Meta wants to take us back for more than a hundred years.”

Privacy only for the rich. While this price is extremely high in general, it also completely ignores the very different income levels in EU countries – and the fact that 21.6% of the EU population is at risk of poverty or social exclusion. The complainant in this case, for example, is in financial distress and receives unemployment assistance. He simply cannot afford to pay another €250 a year, when he is already struggling to pay his rent.

Max Schrems: “More than 20% of the EU population are already at risk of poverty. For the complainant in our case, as for many others, a ‘Pay or Okay’ system would mean paying the rent or having privacy.”

The DPA should initiate an urgency procedure. Given the seriousness of the violations and the unusually high number of users affected, noyb urges the Austrian data protection authority to initiate an urgency procedure to stop the illegal processing. In addition, noyb suggests that the authority imposes a deterrent fine, making sure that no other company starts copying Meta’s approach.

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