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Meta ads promise to competition watchdog

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Meta has promised not to use the data from adverts placed by other businesses on the Facebook platform in order to compete against them, after the UK's competition watchdog flagged concerns.

Meta told the Competition and Markets Authority (CMA) it would remedy a situation which would allow it to develop and improve its own products in competition with its advertisers.

The regulator said the promise came after it launched an inquiry two years ago, which found that Meta was able to use data from its advertisers against them.

“For example, data derived from users’ engagement with ads on Facebook could provide Meta with knowledge as to whether a user is interested in a particular product such as trainers, which could then in turn feed into a decision to show listings for shoes to that same user when it opens the Facebook Marketplace tab,” the CMA said on Friday.

Meta is by some distance the largest supplier of digital display adverts in the UK, earning between £4bn and £5bn in this country alone in 2021, the regulator said. More than 10 million advertisers actively use its services across the world.

Michael Grenfell, executive director of enforcement at the CMA, said: “Where we identify potential competition concerns about a company’s practices or conduct, we look to see how our powers can be best used to have a positive impact on the market.

“Reducing the risk of Meta unfairly exploiting the data of businesses who advertise on its platform for its own competitive advantage could help many UK businesses who advertise there.

“We are now consulting on these commitments which we believe, at this stage, will address our concerns.”

The CMA said that for now it believes Meta’s offer will be enough to address its concerns and it will consult on the commitments.

Today's announcement follows the news earlier this week that Meta had been fined €1.2bn (£1bn) and ordered to stop transferring data acquired from European Facebook users to its US servers.

The record fine was levied by Ireland’s Data Protection Commission (DPC) after a three-year probe into the social media giant. The DPC said that Meta had breached part of the European GDPR (General Data Protection Regulation) rules in the way that it had moved data of Facebook users across borders.

Meta took another financial hit this week, when it was obliged to sell the animated-gif search engine Giphy at a substantial loss, after the CMA blocked its acquisition of the company.

Stock-photo website Shutterstock has agreed to take the short-video platform off Meta's hands for $53m (£42m) in cash, despite Meta having paid $400m for it as recently as 2020.

The CMA's objections to Meta's acquisition of Giphy focused on concerns that it could deny or limit competitors such as Snapchat, TikTok and Twitter access to Giphy's content.

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