Facebook is facing two different investigations by European authorities which will reevaluate whether the societal network’s usage of data gives it an unfair advantage in online advertising.
The investigations may finally lead to heavy fines, and raise stress on Facebook to make modifications to its business model.
In a statement Friday, the European Commission said it was analyzing whether Facebook violated EU competition rules by using information accumulated from advertisers on its own stage to compete .
European Competition Commissioner Margrethe Vestager, who’s established multiple investigations to US technology companies, said in a statement that information gathered via social networks” shouldn’t be utilized in a way that distorts competition.”
“We shall look in detail at if this information supplies Facebook an undue competitive edge specifically online classified advertisements industry, where folks buy and sell products daily, and at which Facebook also competes with businesses where it gathers information,” she said in a statement.
The UK Competition and Markets Authority (CMA) can also be analyzing whether Facebook’s utilization of information has given it” an unfair edge over rivals in supplying services for online classified ads and online dating”
“The CMA will research if Facebook has used the information obtained from its own advertising and only sign-on to do good for its services, specifically Facebook Marketplace… and Facebook Dating,” it said in an announcement on Friday. Facebook Marketplace enables consumers and companies to market second-hand and new things like clothes, books, and furniture.
“Any advantage can make it tougher for rival companies to be successful, such as new and smaller companies, and might decrease consumer choice,” Andrea Coscelli, the CEO of their Competition and Trade Authority added. “We’ll be working closely together with the European Commission as we all explore these problems,” he explained.
A Facebook (FB) spokesperson said that the firm will cooperate fully with the investigations” to show that they are without virtue.”
“We’re constantly developing new and improved services to satisfy the growing demand from folks who use Facebook. Marketplace and Relationship provide people more options and both products function in an extremely competitive environment that has many big incumbents,” the spokesperson added.