Apple and Meta Face 'Fine Hammer' from New Year... Big Tech Regulatory Chill Continues This Year

[Asia Economy Reporter Yujin Cho] Apple, the leading big tech company, and Meta, the world's largest social media company, were hit with hefty fines in Europe at the beginning of the new year. As antitrust regulatory movements targeting American big tech spread worldwide, regulatory pressure on big tech is expected to continue this year.

France's data protection and supervisory authority, the Commission Nationale de l'Informatique et des Libert?s (CNIL), imposed an 8 million euro (approximately 10.8 billion KRW) fine on Apple on the 4th (local time), according to Politico and others. CNIL explained that some iPhone operating systems used personal data for advertising without user consent, violating the European Union (EU) General Data Protection Regulation (GDPR).

Meta was also fined 390 million euros (approximately 530 billion KRW) by the EU on the same day for its use of user data in targeted advertising. The Irish Data Protection Commission (DPC) imposed the fine on Meta and ordered it to complete corrective measures within three months. The DPC judged that the clause requiring consent for personalized ads at sign-up violated the EU GDPR.

Last year, EU authorities intensified supervision targeting big tech companies such as Meta, Apple, and Twitter, imposing hefty fines related to data protection, antitrust, and content management. This year, they are further increasing regulatory pressure on big tech.

[Image source=AP Yonhap News]

The U.S. Congress and political circles have also started tightening regulations on big tech's monopoly power from the beginning of the new year. On January 1, U.S. Representative Mike Gallagher (Republican) likened social media to drugs and announced strong regulations. The Republican Party has suggested preparing strong regulatory measures requiring social media companies to transparently disclose their content management processes, arguing that their content interventions are left-leaning.

Jim Jordan, the Republican ranking member of the House Judiciary Committee, launched an investigation in September last year into allegations that Meta, which operates Facebook, deliberately blocked content damaging to Democratic candidate Joe Biden during the 2020 presidential election. With the new Congress in session and Republicans controlling the House, they are expected to accelerate regulatory actions against Meta, including issuing subpoenas.

Foreign media have evaluated that such pressure will act as a major negative factor for big tech’s business environment, which has already been hit by high-intensity tightening measures from governments worldwide. Since last year, big tech companies have been tightening their belts through workforce reductions and cost-cutting amid worsening external conditions. During the COVID-19 pandemic, the digital market grew rapidly, causing big tech companies to become oversized. However, last year, amid poor performance and recession concerns, they shifted to austerity management. This year, the cold wave for big tech is expected to continue due to global economic recession, stagnant demand, inflation, and supply chain disruptions limiting growth.

Stock prices have plunged amid various adverse factors. Apple, the world's largest company by market capitalization, closed at $125.07 on the first day of the new year, down 3.7%. Its market cap fell below $2 trillion to $1.99 trillion. Although the production shock at Foxconn’s factory in China, Apple’s biggest negative factor, has been partially resolved, concerns over declining iPhone shipments led to the stock price drop. Meta’s stock price also plummeted more than 64% last year, shrinking its market cap to around $300 billion.

This content was produced with the assistance of AI translation services.