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Will Facebook and Instagram leave EU?

Meta the parent company of Facebook and Instagram are not going to leave EU.

To all of you EU citizens. You can relax. Meta – the parent company of Facebook and Instagram just announced that they are not shutting down their social media platforms in European Union.

Although Meta did threaten that it will pull their flagship product from the European Union market, they did not do that and have no intentions in doing so. The problem stems from the data privacy laws in EU. Basically the European Union leaders did not want Facebook to transfer their users data back to the United States of America.

The row has developed amid negotiations between regulators to replace a privacy pact that was thrown out fairly recently.

Facebook and Instagram vs EU
Is Meta going to shut down its services in the EU?

Why is this happening?

Well it’s quite simple really. There are a lot more data privacy and data protection laws in the European Union then there are in the US. EU is a lot more strict on what data can be collected, how long it can be stored and how that data can be used. And the laws are a lot more rigorous when that data is transferred to another country.

Because the primary source of revenue for Meta is targeted advertising, they need the users data. They need it so that they can gauge what the users are interested in, based on their activities on the social media platform. And the more data Facebook can gather about your interest the better. Because that way, they can show more ads specifically designed to hook you in, and get you buying something.

So a pretty dense populated and fairly rich region in terms of GDP like the European Union, would motivate Facebook to maximize their profits off of EU citizens. But, back in July of 2020 the EUs top courts struck down the existing data transfer agreement between the United States and European Union known as the “Privacy Shield” on the grounds that the EU can not be certain that its data can be safe from the United States government surveillance, once it is hosted on data centers on American soil.

Once the data is transferred over the Atlantic, the government agencies like NSA like to monitor all activity that is going on within the USA. Because of that, companies that collect user data like Facebook must rely on different legal mechanism called “Standard Contractual Clauses” (SCCs) to move EU user data onto US servers.

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So what seems to be the problem?

Well, these new SCCs are much more restrictive. They shift much more responsibilities to the data importers to ensure that the policies are followed. And this is what Meta is so upset about. Both Facebook and Instagram collect EU user data and transfer them on American soil via the SCC guidelines. But, they don’t want to have the burden of following the EU data regulations.

Following the regulations would require Meta to spend a lot more money. But setting aside this, if Facebook were to follow this EU rules, it would negatively impact their primary source of revenue. This is because they would not be able to mine as much user data.

We have absolutely no desire and no plans to withdraw from Europe, but the simple reality is that Meta, and many other businesses, organisations, and services, rely on data transfers between the EU and the US in order to operate global services. – Meta spokesperson

All of this is happening in the midst of Facebook stock plummeting. Meta stock price drop is one of the biggest stock price drops in history. As a result, $260 billion were wiped out of Metas market cap. The reason for this huge drop is because the company primary source of revenue is threaten.

Facebook used to be among the top five most valuable companies in the US, but now it has dropped in the eight place. What’s interesting is that the company falls behind NVidia as well.

Even though Meta is making some bold threats to the European Market, Robert Habeck and Bruno Le Maire are not budging. The German economy minister (Robert Habeck) told reporters that after being hacked he lived without Facebook and Twitter for four years. And life has been fantastic. His thoughts are that if the EU would stand united, they will not be intimidated by these threats.

Bruno Le Maire also talked to the press, saying that life is very good without Facebook, and that we would live very well without the platform.

EU vs Social Media Platforms
EU vs Social Media Platforms

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6 Reasons why Meta is in trouble

Its obvious that Meta has its own set of problems to resolve. It turns out that Facebook is weaker than we knew. A trove of leaked documents, published by The Wall Street Journal, hints at a company whose best days are behind it. In its 18 years of history the platform is loosing users for the first time. And guess where they are going? The answer lies within the growing rival called TikTok.

The thing that might save the platform is the heavy investing in the metaverse. But it is a huge gamble. There are very few companies that were able to introduce a new service and be successful at it. This begs the question: Is it possible that Facebook’s metaverse could be the biggest flop in tech history?


The way things are going for Meta, the parent company of Facebook and Instagram, can not allow itself to leave EU. As per the latest market research, Facebook dominates with 82.17% of the market share. So advocating for a legislative fix for transatlantic data transfers, is and should be top priority for this platform. But will the EU budge? The fact is that US and EU regulators have been negotiating for months trying to set up a new agreement for data flows across the Atlantic.

Meta believes a lot is riding on this deal. But what if the unthinkable happens? What if Meta shuts down its services in EU? Well, first of all it might not be all that bad. Users who want to access their Facebook/Instagram profiles will be able to do it via VPN service. But, even so, is it that bad these social media platforms are shut down?

What do you think? Let me know your opinions. Can you live your life without the need of these social media platforms?




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