Irish Watchdog Penalizes Meta By €390M For User Privacy Violation

by Anusuya Lahiri, Benzinga Editor
January 5, 2023 8:27 AM | 2 min read |
  • Ireland Data Protection Commission (DPC) disclosed the conclusion of two inquiries into the data processing operations of Meta Platforms Inc META regarding the delivery of its Facebook and Instagram services. 
  • The DPC penalized Meta Ireland €210 million for breaches of the GDPR relating to its Facebook service and €180 million for violations of its Instagram service.
  • The DPC urged Meta Ireland to bring its data processing operations into compliance within three months.
  • The inquiries concerned two complaints about the Facebook and Instagram services, each raising the same fundamental issues on May 25 2018, the date the GDPR came into operation.
  • Meta has long allowed users to opt-out of personalizing ads based on data it gleans from users’ activity on other websites and apps, the Wall Street Journal reports. 
  • But it doesn’t give users any such option for opting out of ads based on data about activity on its platforms, like what posts a user comments on or videos an Instagram user watches.
  • Analysts say that in-house data is one of Meta’s leading tools for building customized audiences for the personalized ads it sells as part of its core advertising business. 
  • Meta raked $83 billion in advertising revenue for the nine months that ended September 30, nearly a quarter of which came from Europe.
  • If a significant number of people opt out of ads powered with that behavioral data, prices for Meta’s advertising could fall by 10% - 20% in a worst-case scenario, wiping 12% - 25% from the company’s valuation, Morningstar analyst Ali Mogharabi wrote.
  • Meta in 2021 took a revenue hit when Apple Inc AAPL introduced iPhone user tracking norms. 
  • Meta held $41.78 billion in cash and equivalents as of September 30, 2022.
  • Price Action: META shares traded lower by 0.27% at $127.02 in the premarket on the last check Thursday.
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