By Daniel Levi
Early this month, France’s data privacy watchdog CNIL fined Alphabet’s Google €150 million ($169 million) and Facebook €60 ($68,000) million for violating EU privacy rules by making it difficult for French internet users to refuse online trackers known as cookies.
Meta, the parent company of Facebook, is in hot water again for allegedly abusing its market dominance. The social giant faces a surprise 2.3 billion pound plus ($3.2 billion-plus) class action in Britain over allegations that Facebook abused its market dominance by exploiting the personal data of 44 million users. The class-action lawsuit is seeking at least £2.3 billion in damages.
Liza Lovdahl Gormsen, a senior research fellow at the British Institute of International and Comparative Law (BIICL) and the director of the Competition Law Forum, brought the case on behalf of people in Britain who had used Facebook between 2015 and 2019. Quinn Emanuel Urquhart & Sullivan, the law firm representing Lovdahl Gormsen, has also notified Facebook of the claim.
The “first of its kind” case is brought on behalf of Facebook’s 44 million UK users and covers the period October 2015 to December 2019. It is being bought under the Competition Act. The case argues that Facebook “abused its market dominance” by forcing UK users to accept aggressive data collection practices if they wanted to sign up for the social network.
On its website, the team working on the case says that: “Our case will argue that Facebook set an “unfair price’” for its UK users. The “price” set for gaining access to the social network was the surrender of UK users’ highly valuable personal data on a take it or leave it the basis for using the network.
Facebook is by far the largest social network in the UK. Yet, there was a dark side to Facebook’s ubiquity: it is alleged to have abused its market dominance to impose unfair terms and conditions on ordinary Britons giving it the power to exploit their personal data. As many as 44 million UK Facebook users may have been subject to this abuse by Facebook.
By exploiting users’ data, both within the Facebook platform and off-platform through mechanisms like the Facebook Pixel, the company was able to build very detailed pictures of users’ internet usage. By using deep data profiles of its users, the company generated excessive profits.
Facebook abused its market dominance to strike an unfair bargain with users, imposing terms and conditions on a take it or leave basis to access to its social network in exchange for users’ highly valuable personal data, and zero monetary recompense.
“In return, users only received “free” access to Facebook’s social network, and zero monetary recompense whilst Facebook generated billions in revenues from its users’ data. This unfair deal was only possible due to Facebook’s market dominance.”
The lawsuit, which will be heard by London’s Competition Appeal Tribubal, also alleges that Facebook made billions of pounds by imposing unfair terms and conditions that demanded consumers surrender valuable personal data to access the network.
Facebook said people used its services because it delivered value for them and “they have meaningful control of what information they share on Meta’s platforms and who with.”
A Meta spokesperson said: “People access our service for free. They choose our services because we deliver value for them and they have meaningful control of what information they share on Meta’s platforms and who with. We have invested heavily to create tools that allow them to do so.”
“In the 17 years since it was created, Facebook became the sole social network in the UK where you could be sure to connect with friends and family in one place,” Lovdahl Gornsen said.
“Yet, there was a dark side to Facebook; it abused its market dominance to impose unfair terms and conditions on ordinary Britons, giving it the power to exploit their personal data.”
Lovdahl Gormsen further alleges Facebook collected data within its platform and through mechanisms like the Facebook Pixel, allowing it to build an “all-seeing picture” of Internet usage and generate valuable, deep data profiles of users.
Dr. Lovdahl Gormsen added, In a free and fair market, competition should lead to lower prices and increased quality. But the bigger a company is in the market, the less choice we have, no matter what else they’re doing. Facebook has exploited its dominance at its users’ cost.”