Is "Meta" Data Misunderstood?

Meta Platforms, Inc. ("Meta") is an American multinational technology conglomerate that owns and operates the renowned platforms Facebook, Instagram, Messenger and WhatsApp, among other products and services. In 2021, WhatsApp introduced updated privacy terms and conditions for Turkish users, where users were required to accept the sharing of their personal data with Meta group companies as a prerequisite to continue using WhatsApp. After these terms and conditions were revealed, there were public questions as to whether Meta and its affiliates were abusing their dominant position, which led to an ex officio investigation by the Turkish Competition Board (the "Board").

• During its examination, the Board first made an assessment on the dominant position of Meta in the product markets of "personalised social networking services", "consumer communication services" and "online video advertising services". These assessments took into account the number of monthly and daily active users, the market shares of the undertakings calculated on the basis of these numbers, the frequency of use of the relevant services and consumer preferences, as well as barriers to entry and buyer power. Based on its findings, the Board concluded that Meta is in a dominant position in those specified product markets.
• Then the processing of user data in digital markets was analysed from a competition law perspective. The Board issued a decision stating that the practice of combining the user data of Meta affiliates constitutes both an exploitative abuse, by dictating the transfer of data to Meta companies as a prerequisite for using WhatsApp, as well as an exclusionary abuse, by creating barriers to entry and making it difficult for competitors to operate on the relevant markets.
• Further, it was understood that the data obtained as a result of combining of the data between Meta and its affiliates created super profiles after running an analysis on the 4 Vs (variety, velocity, volume, value) formula. Considering that Meta platforms (Facebook, Instagram, WhatsApp and Messenger) appear as the applications with the highest number of users, the highest user dependency rate and the highest user interaction in their respective categories, these super profiles were found to have made Meta the most important and even indispensable channel for advertisers. Therefore, it was concluded that the practice of combining of user data made competitors' activities more difficult, created barriers for entering into relevant markets, reduced consumer alternatives and increased the lock-in effect.
• As a significant note, the Board stated that, even if a different structure that envisaged obtaining free and explicit consents of the users was to be implemented with the update of WhatsApp's privacy terms and conditions, this would not change the anti-competitive effects created by the use of WhatsApp data in other Meta platforms/services.

In light of this, the Board has rendered its decision1 in relation to the allegations that Meta Platforms, Inc. (formerly Facebook Inc.), Meta Platforms Ireland Limited (formerly Facebook Ireland Limited), WhatsApp LLC and Madoka Turkey Bilişim Hizmetleri Ltd.Şti. have breached Article 6 of Law No 4054 on the Protection of Competition (the "Law") through abusing their dominant position (the "Decision"). The Decision set out that Meta has breached the Law, as its policy of combining the data obtained by its affiliates encumbers the activities of its competitors, creates an entry barrier to the relevant markets and thus reduces consumer welfare. Consequently, the Board imposed administrative fines and stipulated behavioural measures to Meta. In this context, Meta received an administrative fine of TRY 346,717,193.40 along with several behavioural measures.

On a related note, the United Kingdom's Competition and Markets Authority have also reached an agreement with Meta amid an investigation into its use of marketplace data.2 Meta has signed commitments that will prevent the company from exploiting its advertising customers' data, meaning that businesses, and ultimately consumers, are protected. Without these measures in place, Meta risks having an unfair competitive advantage that could distort competition. Going forward, competitors of Facebook Marketplace that advertise on Meta platforms can 'opt out' of their data being used to improve Facebook Marketplace. As well as giving competitors more autonomy over their ad data, Meta has also pledged to limit how it uses ad data when developing its products. As a result, Meta cannot exploit advertising customers' data to give itself an unfair advantage when competing with products or services sold by those advertising customers.

Seeing that the policy of combining the data obtained by Meta affiliates constitute a breach of competition law and received sanctions from a number of competition authorities, Meta's practice of using the personal data of users of its affiliates as a means of improving its marketing strategies and advance its profits becomes more contestable. One may, on the other hand, simply conclude that not every personal data from Facebook, Instagram, Messenger and WhatsApp users is "Meta" data.

Prior to the reasoned Decision of the Board, we went through the Board's focus on the intersection of personal data and competition law in light of recent developments in the EU in one of our previous publications titled "The Intersection Of Personal Data And Competition Law In Light Of Recent Developments In Türkiye And The EU". We also analysed the implications of the Digital Markets Act on the operations of the giant technology companies from a competition law perspective in one our previous publications titled "Is The DMA A Friend Or Foe To BigTech Companies?" In this respect, as mentioned in these publications, the competition authorities from multiple jurisdictions have increased their interest in scrutinising and maintaining the operations of BigTech companies to ensure healthy competition on the digital markets.

Footnotes

1. Turkish Competition Board's decision dated 20.10.2022 and numbered 22-48/706-299.

2. For more information, please visit the website (https://www.gov.uk/government/news/cma-secures-improvements-in-ways-amazon-and-meta-treat-competitors-benefitting-customers)