Meta keeps growing amid $25bn fine and ‘outrageous assault on journalism’
Meta grew revenue 26% year-on-year to $64.6bn in Q3, the company revealed in its latest earnings report.
The tech giant’s costs and expenses meanwhile rose 68% to $51.6bn, amid its rapid investment in AI infrastructure, continued losses at its Reality Labs division, and mounting legal fees.
“Our investments are paying off, the core business is strong, and we’re seeing velocity across the board,” CEO Mark Zuckerberg said in a statement.
On Meta’s earnings call, Zuckerberg touted Meta’s Muse AI assistant and Muse Wonder frontier AI model. He claimed that Muse now counts 10m users in the US and Canada just six weeks after its release.
A quarter of those users, Zuckerberg said, are using the personal assistant to engage in personal shopping, with average purchases above $200.
Largest-ever fine
The earnings report was announced the same day a judge in New Mexico fined Meta $25bn after a jury had previously found the company misled consumers about how it handled Facebook user data during the Cambridge Analytica scandal.
It is the largest fine ever given to Meta. In his judgement, Judge Francis Mathew said, “the harm in this matter is difficult to overstate, and goes to the heart of Facebook’s basic business proposition”.
Meta’s head lawyer said it would appeal the decision.
Meta commits to make platforms less harmful, but questions remain over implementation
The case is just the latest in a string of legal losses faced by Meta over data privacy, addictive design, and online harms. An earlier child safety case in New Mexico this year resulted in combined penalties of $942m.
In August, the tech giant also reached a settlement with 47 states, the District of Columbia, and other US territories, agreeing to pay over $17bn in penalties following allegations that Meta designed deliberately addictive products targeted at children.
Meta admitted no wrongdoing, but agreed to make changes to its platform design aimed at reducing harms for children and teens. Such changes have yet to be implemented and may apply only to the US market.
‘Outrageous assault on journalism’
Meta’s business practices have also once again come under regulatory scrutiny this week after the tech giant announced it would update its terms of service on 30 October to force all companies with business accounts on Facebook or Instagram to allow Meta to scrape their business websites to power its AI products.
The terms notably apply to publishers, meaning that if publishers want to keep accounts on Meta’s mass-reach social media platforms, they would need to allow Meta to scrape their content.
Movement for an Open Web (MOW), a campaign group that fights against the monopolisation of the internet by tech platforms, has filed a formal complaint against the manoeuvre to both the European Commission and the UK’s Competition and Markets Authority (CMA). It alleges the actions are unfair and exploitative in competition law and should be blocked by the CMA.
It has also advised publishers to delete their corporate and business accounts on Meta platforms before 30 October to ensure Meta does not ingest their intellectual property.
“The terms go live in a few days time and, once they’re in force the damage will be done – you can’t unscrape that content,” explained MOW co-founder Tim Cowen. “Therefore the CMA must use their interim measures powers to block the introduction of these terms whilst a deeper investigation is undertaken.”
The News Media Association (NMA) has likewise asked the CMA to secure an immediate pause on the new terms of business, warning that local news publishers would be “hardest hit” given local titles derive an outsized proportion of traffic from Facebook.
“Meta’s bid to force publishers to allow unrestricted scraping of their websites to power its AI products is an outrageous assault on journalism,” NMA CEO Theo Bamber said.
Referring to the move as a “shameless land grab”, Bamber said it is “vital” for publishers to maintain strong presences on Facebook and Instagram “to combat the mis- and disinformation which plagues” the platforms.
He continued: “Parliament placed the Digital Markets, Competition and Consumers Act on the statute books to empower the CMA to prevent exactly this kind of cynical and anticompetitive tech platform bullying of UK businesses. The regulator must now use these tools as a matter of urgency.”