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EU Regulators Accuse Meta of Antitrust Violations Over New Ad-Supported Service

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EU Regulators Accuse Meta of Antitrust Violations Over New Ad-Supported Service

Meta, the parent company of Facebook, faced allegations from EU regulators on Monday for failing to comply with the bloc’s landmark antitrust rules concerning its recently introduced ad-supported social networking service. The European Commission criticized Meta’s subscription model, labelling it a “pay or consent” scheme. This model forces users to either pay to use Meta’s platforms without ads or consent to their data being processed for personalized advertising. This ad-supported subscription service was introduced for Facebook and Instagram in Europe last year.

EU Commission’s Preliminary Findings

The Commission’s preliminary view suggests that this binary choice compels users to agree to the combination of their personal data, thereby failing to provide a less personalized but equivalent version of Meta’s social networks. In a statement on Monday, the regulators emphasized that users should have access to a service that utilizes less of their personal data for ad personalization.

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Meta’s Response

A Meta spokesperson responded to the allegations by stating that the company’s ad-supported subscription model adheres to the directives of the highest court in Europe and complies with the Digital Markets Act (DMA). “We look forward to further constructive dialogue with the European Commission to bring this investigation to a close,” the spokesperson added. Meta introduced this new model following a ruling from the European Court of Justice last year, which allowed companies to offer an alternative version of their service that does not rely on data collection for ads.

Commission’s Critique

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Despite Meta’s justification, the Commission found two key issues with Meta’s ad-supported offering. First, it doesn’t allow users to choose a service that uses less personal data but is still equivalent to the personalized ads-based service. Regulators asserted that users should be able to access an equivalent service with reduced data usage for ad personalization.

Digital Markets Act (DMA) Enforcement

The DMA, enforceable since March this year, aims to curb anti-competitive practices by large digital companies and mandate them to open up some of their services to rivals. Companies found in breach of the DMA could face substantial fines, potentially up to 10% of their global annual revenue, and for repeated breaches, this figure could rise to 20%. For Meta, a breach of the DMA could result in a penalty as high as $13.4 billion, based on the company’s 2023 annual earnings.

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Next Steps for Meta

Following the receipt of the EU’s preliminary findings, Meta has the opportunity to defend itself in writing. The Commission’s investigation, launched in March alongside two other probes into tech giants Apple and Alphabet, will conclude within 12 months from the start of the proceedings.

Meta’s compliance with the EU’s antitrust rules remains under scrutiny, as the company navigates these regulatory challenges while attempting to align its business practices with the DMA’s requirements.

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Microsoft Unveils AI Tools to Support Doctors and Nurses and Ease Workload

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Microsoft Unveils AI Tools to Support Doctors and Nurses and Ease Workload

Microsoft announced on Thursday a range of new AI tools designed to help health-care professionals manage administrative tasks and improve patient care. Among the innovations are medical imaging models, a healthcare agent service, and a documentation solution aimed at nurses. These tools are intended to streamline workflows, saving valuable time that clinicians often spend on paperwork, a known factor in industry burnout. According to the Office of the Surgeon General, nurses spend up to 41% of their time on documentation.

Mary Varghese Presti, Microsoft’s vice president of portfolio evolution and incubation at Health and Life Sciences, emphasized the impact of AI on healthcare systems. She highlighted its potential to “reduce the strain on medical staff, foster collective health team collaboration, and enhance the overall efficiency of healthcare systems across the country.”

This move follows Microsoft’s ongoing efforts to expand its presence in healthcare AI. Last year, the company introduced health-related features across its Azure cloud and Fabric analytics platform and completed its $16 billion acquisition of Nuance Communications, known for its speech-to-text AI solutions.

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While many of the new tools are still in development or available only in preview, they promise significant improvements. The collection of AI models can analyze various data types, including medical images, clinical records, and genomic data. Microsoft aims to empower healthcare organizations to develop innovative applications based on these models, helping doctors and nurses provide better care while reducing their administrative burden.

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Escalating Tensions Between Banks and Tech Companies Over Online Fraud Liability in the UK

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Escalating Tensions Between Banks and Tech Companies Over Online Fraud Liability in the UK

Tensions are mounting between banks, payment firms, and social media platforms in the U.K. over the responsibility for compensating victims of online fraud. Starting from October 7, banks will be required to compensate individuals up to £85,000 if they fall victim to authorized push payment (APP) fraud—a type of scam where criminals manipulate people into transferring money to them.

Although the £85,000 limit is lower than the £415,000 initially proposed by the U.K.’s Payment Systems Regulator (PSR), it still represents a significant burden for banks and payment companies. Industry groups, such as the Payments Association, argued that the higher compensation figure would have been too costly for financial institutions to bear.

As mandatory fraud compensation takes effect, concerns are growing within the banking sector about whether they are being unfairly saddled with the financial cost of protecting consumers from fraud. The issue has sparked criticism from financial institutions like digital bank Revolut, which recently accused Meta, the parent company of Facebook, of not doing enough to combat fraud on its platforms.

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Revolut’s head of financial crime, Woody Malouf, argued that social media companies should share the financial burden of reimbursing fraud victims. Malouf said that by avoiding financial responsibility, platforms like Meta lack the incentive to implement stronger anti-fraud measures.

This conflict over fraud liability highlights the growing pressure on both financial institutions and tech companies to find solutions to the rising tide of online scams, as consumers continue to fall victim to fraud through digital channels.

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Judge Orders Google to Open Android App Store in Epic Games Case

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Judge Orders Google to Open Android App Store in Epic Games Case

A U.S. judge has issued a permanent injunction forcing Google to offer alternatives to its Google Play store on Android devices. This landmark ruling, part of Epic Games’ antitrust lawsuit against Google, means that the tech giant must allow other app stores to compete and access its Play Store catalog.

The decision comes as a major win for Epic Games, which initially sued Google in 2020, accusing the company of anti-competitive practices such as paying phone manufacturers to avoid developing rival app stores. Under the ruling, starting in November, Google will be restricted from:

  • Paying companies to launch apps exclusively on Google Play.
  • Preventing companies from creating competing app stores.
  • Requiring app makers to use Google Play Billing or preventing them from promoting cheaper pricing options on their websites.

The ruling could reshape the app market by allowing developers to bypass Google’s fees, which typically range from 15% to 30% of sales. This could result in developers keeping a larger share of the revenue from the estimated $124 billion consumers spent on apps in 2023.

In addition to these restrictions, a three-person committee will be established to monitor Google’s compliance with the order. This ruling sets a new precedent in app market competition, paving the way for more choices for consumers and app developers alike.

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