This week's bombshell news has undoubtedly been the possibility that the territory of the European Union will be left without Instagram and Facebook (both owned by Meta, the company led by Mark Zuckerberg) due to the impossibility of exporting and managing European users' data to the United States.
While it is not so easy for Facebook and Instagram to leave Europe, it is something that can happen and that, moreover, is the result of two opposing visions of conceiving the importance of privacy: the protective European General Data Protection Regulation (GDPR) and the lack of U.S. regulation.
Headlines this week claimed that Meta had threatened to stop providing service in EU countries, as reflected in a document Meta has filed - it is required to do so - with the U.S. stock exchange regulator explaining the potential risks to investors of its business model.
"Meta's social networks store the data and process it on U.S. servers and this data transfer does not comply with the GDPR," says technology law attorney Samuel Parra, of the company Égida, so there is a possibility that at any time Europe will impose substantial fines on Meta and it will stop providing this service, which would affect the accounts of millions of users. This is a risk that hides a veiled threat.
High European protection VS. the lack of U.S. standards
In contrast to the privacy guarantees offered by the GDPR on the treatment of European citizens' information, the USA does not have specific regulations: "any government official can access your Facebook profile and see who you correspond with, what you write... Here, if an official wants to do it, it has to be with a court order, but in the USA there is no judicial control over mass access to citizens' information," says Parra, and that privacy is what the GDPR is trying to preserve.
This is not the first time that the possibility of Meta ceasing to offer its social networks in the EU has been raised. In fact, it's the latest chapter in a decades-long standoff. Parra recalls that since 1995 "there has been a problem with sending personal data from Europe to the US, but in 95 there was no Facebook or Google, the problem appeared with these companies and, when it arose, a legal framework was created, the "Safe Harbor" that the Court of Justice of the European Union (CJEU) annulled. Then another regulatory framework was then created, the Privacy Shield, which was also annulled in 2020" for the same reason.
It's an issue that affects every other company based in the US. "The problem is not with Meta with its Facebook, Instagram, and WhatsApp; it is also with any company that operates in the USA and offers services globally or at least in Europe. Any cloud service like Dropbox, Google Drive, Azure, Amazon Drive, etc., will have the same kind of problems," Parra says.
But this is not all. The situation can also be extended to companies in China (to which the same lack of privacy problems are attributed as in the United States), which would affect the social network Tik Tok. In fact, in order to comply with the GDPR, even the public administrations of EU countries would have to host their citizens' data on European servers.
Due to the "Privacy Shield", no company can transfer the data of European citizens to the United States, which is precisely Meta's business. And Meta needs that information, as it finances itself by offering companies the ability to target specific audiences thanks to the information it collects from each user.
Zuckerberg has tried on several occasions to cross-reference data from two of his companies (Facebook and WhatsApp) to better understand the advertising that may be of interest to each user and, notes Parra, he seems to be already thinking about the possibilities that all that information could be an active player within Metaverse that he is creating.
A new legal framework is needed
To avoid fines and allow U.S. companies to continue offering their services in the EU, both parties must establish another legal framework, but it is not easy because of the distance between the two positions and, in addition, there is the possibility that the CJEU will overturn it again.
"I imagine that they are taking longer to draw up a new agreement because they don't want it to be annulled again. Meta is unsure about continuing to deploy its services in Europe because it has no legal framework to rely on. As an investor, I would find it very unserious if this were to happen a third time," says Parra.
Following this week's uproar, Meta vice president Markus Reinisch issued a statement on the 8th indicating that the company is not threatening to leave and that 70 other companies are facing the same situation. At the same time, he hoped that a new agreement would be put in place to replace Privacy Shield and allow the transfer of data on both sides of the Atlantic. But the tension on this issue has only grown in recent days. Just this week the French data protection authority (CNIL) declared illegal the use in that country of Google Analytics, the famous search engine's tool for measuring user traffic on a page that assigns a unique identifier to each visitor.
For their part, the economy ministers of Germany, Robert Habeck, and France, Bruno Le Maire, made the European position clear on Wednesday, stating after a bilateral meeting that it would be perfectly possible to do without these companies. "After living without Facebook and Twitter for four years, my life has been great," said Habeck, while the latter sentenced: "The digital giants must understand that the European continent will resist and assert its sovereignty," which are certainly not friendly words for the American giant.
And if there is no agreement?
If such an agreement were not reached, Facebook and Instagram, and many other services, would effectively become unavailable to European citizens, with the resulting social and economic disruption and harm. "We would find alternatives, but the disruption that would be generated in between would not be pleasant. Nobody would be happy," says Parra, who believes that, if this were to happen, there would be a period in which European users would be able to access their account and download all the content: photos, messages, contacts.
Probably with a process as simple as pressing a button, "as happened in its day with Tuenti when it announced that it was going to close as a social network. Then we would have to see, adds the lawyer, "if we could find a substitute in Europe where we could dump everything and create a network with what we had or start from scratch somewhere else".
If Europe were left without these services, not only would personal communications suffer, but it would also affect researchers who share knowledge on social networks or study them (not everything is garbage on social networks) and the companies that use them to do business, both those that use them to promote their brand or communicate directly with consumers and those that depend on them to sell and develop their marketing plans.
Fernando Clavijo, Digital Marketing Director at the Spanish digital marketing and communications agency Trescom, points out that for the latter "it would be a catastrophe in the short term because, thanks to the enormous reach provided by these networks at an affordable cost, they have built their entire marketing strategy". Although, according to Clavijo, the most affected would be e-commerce companies that have focused all their efforts on Instagram and Facebook.
What would happen to influencers?
Not to be forgotten are influencers, "especially in the case of Instagram, who live solely off this network," who would have to start from scratch elsewhere. In such a case, influencers would need to be offered a similar service to the one they had, allowing them to continue socializing, consuming content, and discovering products and brands.
Parra adds that these professionals are used to adapting to new channels "as has happened with TikTok and Twitch, so they have a very high capacity for innovation and adaptability in the digital environment".
According to Clavijo, none of the social networks out there today that meet the requirements of the GDPR can compare to Facebook and Instagram. "Their ability, thanks to their algorithms and the data they collect from users to segment advertising campaigns is something that has not yet been seen in other similar services. We should not forget also other tools that allow selling directly through the network itself, boosting conversion. On the other hand, the use of Facebook and Instagram is massive and covers all ages and genders, growing in users year after year.
That is why, although their closure would create a gap in the market that would drive the creation of similar social networks, it will take a long time before these new platforms reach the critical mass of users needed to provide the services that Facebook and Instagram provide to different companies.
What do you think about a possible closure of Facebook and Instagram in Europe, do you think it could be possible? Let us know your opinion in the comments box.
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