The European Commission’s newly announced fines of €500 million against Apple and €200 million against Meta for alleged violations of its Digital Markets Act undermine key aspects of both online ecosystems. To make matters worse, they are also almost certain to exacerbate tensions with a notoriously trigger-happy U.S. administration.
The commission claims Meta’s “consent or pay” advertising model, which lets users either consent to personalized ads or pay monthly fees starting from €5.99 for an ad-free experience, violates the Digital Markets Act because users are not offered a “truly equivalent and free” alternative to personalized ads.
Apple, for its part, is accused of hampering alternative app distribution channels outside of its App Store. This matters for downstream rivals like Epic Games and Spotify, for whom Apple’s App Store fees are a significant cost of doing business.
Even on their own terms, these decisions are of dubious merit. In Meta’s case, personalized ads aren’t some nefarious trick to exploit users; they are the engine that powers most free online services. Tailoring ads to user interests makes advertising far more efficient. Estimates suggest that personalization typically drives a 10 to 15 percent boost in revenue for businesses.
This isn’t just good for major ad platforms like Facebook and Instagram. Higher ad returns mean a healthier market: niche businesses can connect with interested buyers, platforms like Meta can show less-obtrusive ads, and evidence shows that consumers often prefer platforms’ services when ads are displayed alongside other content.
The commission should know better. Economic research shows that similar requirements imposed under the European Union’s General Data Protection Regulation have curtailed innovation and investment in Europe. This is, among other things, because they make it harder for startups and other small firms to reach consumers via advertising.
Similarly, in Apple’s case, the commission’s decision could create risks exacerbating users’ exposure to fraud and security risks. Apple’s strict review process and vertically integrated payment system are deliberate safety features that keep fraud, malware and shady data practices at bay. Apple’s model, with greater integration of hardware and software, also allows for a better user experience and facilitates accountability for consumers. After all, if users did not appreciate this relatively closed model, iOS would not have become both the most profitable and the safest mobile operating system.
Even if one agrees with the EU’s regulatory zeal, the timing is spectacularly poor. Europe has so far escaped the worst of U.S. President Trump’s “Liberation Day” tariffs, but that could change quickly in an administration that perceives Europe’s tech fines as an outright attack on American business.
Trump has lambasted the EU’s repeated multibillion-dollar penalties as “overseas extortion” and explicitly threatened retaliatory tariffs in response. In a recent memo, he warned that his administration will consider tariffs to counter Europe’s digital practices and fines on U.S. firms. Vice President JD Vance has voiced similar concerns about Europe’s tech fines, and U.S. Rep. Jim Jordan (R-Ohio) wrote to EU Commissioner for Competitiveness Teresa Ribera to express concerns about the DMA’s weaponization against American companies.
Regardless of how one feels about Trump’s use of tariffs as a geopolitical bargaining chip, it is a threat the EU cannot and should not ignore. The global economy is facing uncertain times and the Western alliance appears on the brink of collapse.
The cases against Meta’s reliance on personalized ads and Apple’s App Store are misguided from a competition-law perspective. But they are worse from a broader policy perspective because they provide Washington an excuse to escalate.
Brussels is indeed feeding the narrative that Europe’s regulation is less about protecting users and more about punishing foreign tech. That plays directly into Trump’s hands, exacerbating a destructive trade war that could badly hurt European industries far beyond the tech sector.
Europe’s leaders should ask themselves whether this is really a battle worth waging. Picking high-profile fights with Meta and Apple might score political points, but it’s everyday Europeans who stand to lose from degraded online services and trade-related fallout.
Dirk Auer is an adjunct professor at the University of Liège and is the director of competition policy at the International Center for Law and Economics.
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