Meta fights Ofcom over how many billions count as billions

Meta appears to have decided Britain's Online Safety Act would be much easier to swallow if Ofcom stopped counting all the money the social media giant makes everywhere else. The Facebook and Instagram owner has launched a legal challenge against the UK comms regulator, arguing that the way Ofcom calculates fees and potential …

[Adair]

Aww, diddums

Now if only OFCOM has the guts to enforce meaningful fines that provoke actual compliance and good behaviour.

[Like a badger]

Re: Aww, diddums

If only. Zuck will already be whining at the court of Kind Donald, and when the fat felon throws yet another juvenile tantrum and threatens to annex the Isle of Wight, or impose higher tariffs on Irish potato products, you can be sure the British government will cave in.

[Aladdin Sane]

Re: Aww, diddums

I don't think the UK government will give too much of a shit about tariffs on Irish potato products.

[Like a badger]

Re: Aww, diddums

Nor about the Isle of Wight, but my comment was referencing the tenuous grasp of facts, geography and reality on the part of Trump.

[LybsterRoy]

Re: Aww, diddums

What about the tenuous grasp of facts, geography and reality on the part of our wonderful government? Hmmm, where do Golden Wonder & Walkers source their spuds?

[Anonymous Coward]

Re: Aww, diddums

Last time they did that, it didn't end well.

[Anonymous Coward]

Re: Aww, diddums

Ofcom will cave long before Donald’s harrumphing.

[Alumoi]

Re: Aww, diddums

They will enforce them, but they won't collect. Everybody is happy.

[Anonymous Coward]

Re: Aww, diddums

There is no fine large enough to provoke "good behavior" by Meta.

Their business model is built on being harmful to users and they have no desire to change what brings in the money...because, otherwise, what's the point?

They're not going to stop deploying addictive features, maximizing compulsive use, harvesting private data without informed consent, committing advertising, or deploying rage-baiting algorithms.

Look no further than their total AI spend. Even if their AI hopes do come to pass, that's way too much money for what it takes to operate a few messaging apps and the "what's going on in my life" page that Facebook purports to be.

Their total AI spend can only result from a belief that AI models, given endless amounts of personal data, represent the next frontier in human emotional manipulation, whether that comes in the advertising itself or knowing what to present to each user to keep them using as much as possible. That's been the case since before even the original "Metaverse" plan, which read like a dystopian sci-fi story where humans obsoleted by AI could experience a simulated Brave New World, rather than having to endure it in meatspace (which uses more physical resources).

[Anonymous Coward]

Re: Aww, diddums

Maybe some good can come of Meta's behaviours? If we can stop its regular visitors from procreating, then we'll expunge the genetic vulnerability in a few generations?

[Jellied Eel]

Re: Aww, diddums

Maybe some good can come of Meta's behaviours? If we can stop its regular visitors from procreating, then we'll expunge the genetic vulnerability in a few generations?

Seems to be working already. I wandered down the rabbit hole of 'looksmaxing' in a WTF? kinda fashion. In which I discovered some kid who thought smacking himself in the face with a hammer was better than asking a cosmetic surgeon. Plus injecting massive amounts of synthetic testosterone, steroids and random experimental & unlicensed pharamceuticals into adolescent bodies would ever be a good idea. But injecting massive amounts of androgens into developing bodies would probably make sure they never can procreate.

So having seen some of that stuff, I can understand why better regulation and limiting what kids are exposed to on 'social' media is a good thing. Especially when it involves outright illegal activity that will be very harmful to kids. But also supports billions of dollars in flogging PEDs and encourages kids to spend on 'peptides', much of which can be bought on FacePalm marketplace.

[LybsterRoy]

Re: Aww, diddums

I downvoted you. I'm all for the rule of law but I also believe in common sense and I fail to see a linkage between any offence commited against a law in this country and a company's global turnover.The only potential is if a company's global activities enabled the deliberate breaking of the law in this country.

This from someone who would like to see most of the social media operations (excluding elReg which is why most) terminated (possibly with extreme prejudice!

[Anonymous Coward]

Re: Aww, diddums

It’s a threat to ensure compliance with the law. It’s common across regulatory areas globally Inc Data, Fraud, Bribery…

[Knotty Ropes]

Re: Aww, diddums

This is simple. They will just claim, "The company within the country earns nothing, because it has to pay such high costs to the parent company in Ireland! :("

It's literally just paper, and BS creating those walls, but they will swear up and down it's true.

So if they can game their earnings and revenue there, that means you just have to ignore it. Go for what they ACTUALLY ARE, not what they pretend to be.

[Anonymous Coward]

Re: Aww, diddums

They will back down as they are an utterly useless pile of shite as a regulator - so regulator sector averaging.

I’m sure British Airway’s Catastrophic Data Breach (fine reduced from £163m to £20m) lawyers are consulting for Meta.

[Aladdin Sane]

Maths

OFCOM does maths. And if Meta et al don't want to be fined UP TO 10% of their global revenue they should put in the time and effort to not breaking the regulations.

[cipnt]

Re: Maths

There is a hard ceiling to these fines, which is quite low for a company like Meta.

[Aladdin Sane]

Re: Maths

10% of revenue isn't low. Annual revenue was $200 billion, profit $60 billion. so 10% of revenue would wipe out a third of their net income.

[Anonymous Crowbar]

Re: Maths

Hard cap of £18m. It is in the article......

[richardnpaul]

Re: Maths

Read it again, like GDPR it says whichever is higher, that means for smaller companies the fine could be well above 10%.

[WSWS]

Re: Maths

Jesus Christ. 18m or 10%, whichever is HIGHER. Are you illiterate?

[Mast1]

Re: Maths

So what's the benefit of being a holding company of lots of subsidiaries if one small country is going to fine them based on global rather than local revenues ?

Ah yes, c-suite pay is based more on global than local revenues.

Sounds more like a potential case of "heads we win" and "tails you should lose".

[Jimjam3]

Re: Maths

That’s a bit harsh.

I agree that the UK online safety act is a hastily designed bill created by a hopeless government that instructs OFCOM to chase after enormous amounts of cash. But the UK has ( in the past) contributed to the development of the western world.

[LybsterRoy]

Re: Maths

I upvoted you but I'm still trying to work out the relevance of past vs current.

[Blazde]

Re: Maths

It has to be punitive otherwise a multinational like Meta could easily flaunt the rule in the UK while paying tiny fines as a cost-of-business and growing market share. Hence, it's based on their ability to pay, not any borders.

When BP trashed the Gulf Of Mexico their fines were not limited to revenue from rigs only in that sea. That'd too easy.

[Aladdin Sane]

Re: Maths

Also, the slimy little gits are pros at making no official revenue in a country and booking it somewhere with a lower tax rate.

[Anonymous Coward]

One beellion dollars

It's ok, we're Brits so we'll settle for a British billion, in other words £1,000,000,000,000.

[Fruit and Nutcase]

Alternatively

Instead of fining Meta this way, what about this, where Meta will NOT be fined a single penny.

At College in, opposite the Houses of Parliament, in a specially constructed stage will be a pillory where Zuckerberg will be ushered into and secured. Now, invited people, victims and family of victims of Meta's inaction, passers by etc, can take the opportunity to make full use of the situation, in the time honoured manner, over a few days which should give Zuckerberg plenty of time for reflection.

https://en.wikipedia.org/wiki/Pillory

For a second offence, Zuckerberg can sample some of the delights available at the Tower of London.

[Fruit and Nutcase]

Re: Alternatively

College in [Green]

[Irongut]

> Meta appears to have looked at where that enforcement road leads and decided now was the time to argue about the math.

Meta can argue about the "math" all they want but Ofcom know that mathematics is a plural.

I know the site has been dumbed down to Yank levels in the last year but in an article about Ofcom and the UK you could at least, correctly, write "maths."

[Rich 2]

Can I upvote you a hundred times? The Reg’s bad spelling in the name of “being more international” (yes I know - work that one out!) is REALLY irritating

[R Soul]

Better still, they could write about arithmetic. Because that's what we're actually talking about here - not mathematics.

[Bebu sa Ware]

If Meta wants to be fined on their UK revenues

perhaps they ought to pay more UK taxes on all those revenues.

Maybe they do, I don't know but I do know pigs don't fly as a habit.

"where that enforcement road leads and decided now was the time to argue about the math."

Following the old joke - it has been agreed what Meta is, and now only haggling over price.

[Headley_Grange]

Re: If Meta wants to be fined on their UK revenues

Yeah - if they win then watch the UK revenue drop as Meta Virgin Islands charges Meta UK £billions via Meta Cayman Islands for use of trademarks, logos, software, good will, etc., to the extent that Meta UK makes a loss.

[Wellyboot]

Re: If Meta wants to be fined on their UK revenues

I'm not aware of any Meta involvement in running critical UK infrastructure, so until fines are paid OFCOM could just outright ban them. Many politicos would trample each other to climb onto that bandwagon (Billions more cash for the government).

Meta Zuck would have to choose between a massive* one-off fine or the loss of all the ongoing UK revenue. This would be an 'encouraging others' event for lots of countries with similar legislation.

* relative to most fines, but only a fraction of this years Meta AI cash burn.

[Rattus]

Re: If Meta wants to be fined on their UK revenues

Meta Zuck would have to choose between a massive* one-off fine or the loss of all the ongoing UK revenue. This would be an 'encouraging others' event for lots of countries with similar legislation.

you think that the fines will change corporate behaviour? I don't, and neither does meta. This won't be a 1 off payment because they won't change. as a result they are simply looking to reduce the cost of fines low enough to be considered a 'tax' something to be reduced again and again as part of business as usual

[Excused Boots]

Re: If Meta wants to be fined on their UK revenues

OFCOM can’t actually ban them, they don’t have that power - and even if they did then how could they do it? Hypothetically they could seek a Court order instructing all ISPs to block access, but that worked so well in the case of PirateBay etc. didn’t it?

Now faced with that, if I were in charge of Meta, before this ‘ban’ comes into effect, I’d make a public statement probably also inject it into every single users feed along the lines of ‘we’re sorry but as of xyz date, Facebook will no longer be available to anyone in the UK - all of you small businesses what rely on Facebook to advertise and promote themselves; sorry. All off you local community groups, sorry. And this is a decision by your government who has decided to not allow us to operate in your country. Something you might well want to consider when election time comes around!’

The crash of reverse-gear being applied will be heard on the moon!

[Sub 20 Pilot]

Re: If Meta wants to be fined on their UK revenues

Overall, the damage done by parasites like Meta far outweigh the fact that freeloading companies are using it to push even more advertising onto the platform.

If you run a business you have base line costs such as I have and that is the cost of doing business. I would never put my company on that shiteshow of a platform. In fact any company that tells me I can only contact them via their FB page is a company that I will not work with or for.

Another point - if these huge tech companies paid their fair share of tax I would be more sympathetic but as they all claim to make no actual revenue or profit in any place other than favourable tax havens then they have bought this upon themselves.

If all ''social media'' disappeared tomorrow the world would be a nicer place. And, before the usual suspects chime in and say ''but you are posting on social media'' go and look up the difference between that and a moderated forum like this.

[doublelayer]

Re: If Meta wants to be fined on their UK revenues

Your opinion makes no difference to the point the previous comment was making. You might hear "Meta ban" and be pleased about it, but lawyers will be wondering how it's legal (hint, it isn't) and more of your countrymen use it than don't, and each of them gets just as much vote as you do. Therefore, a ban is likely to fail because it's not legal and simultaneously wreck the careers of people who were willing to do it, so who would likely also be willing to do things against Facebook that would actually work. So maybe it's not as pleasant a prospect as it originally seemed?

[Like a badger]

Re: If Meta wants to be fined on their UK revenues

OFCOM can’t actually ban them, they don’t have that power

Well, courtesy of HMG: "In the most extreme cases, with the agreement of the courts, Ofcom will be able to require payment providers, advertisers and internet service providers to stop working with a site, preventing it from generating money or being accessed from the UK."

[Blazde]

Re: If Meta wants to be fined on their UK revenues

OFCOM can’t actually ban them, they don’t have that power - and even if they did then how could they do it? Hypothetically they could seek a Court order instructing all ISPs to block access, but that worked so well in the case of PirateBay etc. didn’t it?

It's not at all hypothetical. OFCOM powers are there in black and white in the legislation, and have little to do with the much more limited PirateBay whack-a-mole powers. OSA 2023, Chapter 6 Enforcement powers, Business disruption measures (most relevant, there are some other aspects too).

If you're arguing UK Facebook, Instagram & Whatsapp users would en-masse resort to VPNs, while previously lawful advertisers would happily use foreign means of payment and cook their books, then I can't help you I'm afraid. The Online Safety Act isn't exactly overwhelmingly popular in the UK but it definitely comes out ahead of Facebook & Instagram popularity.

[LybsterRoy]

Re: If Meta wants to be fined on their UK revenues

Wish I'd read your post before making mine

[WSWS]

Re: If Meta wants to be fined on their UK revenues

They won't ban them, because then they would have to answer to millions of angry UK users who want to know why they can't get on Facebook anymore. It has to be approaching the point that Facebook just says "fuck it" and blocks the UK themselves though, when our fascist government keeps trying to claim jurisdiction over money that a US company makes in the US.

[LybsterRoy]

Re: If Meta wants to be fined on their UK revenues

Whilst I love the idea of banning Facebook its an unfortunate fact that many businesses use it as their sole means of customer communication, many individuals use it as their means of connecting to life (yuck) so I think there may be a politically unacceptable from the populace if Facebook was closed down.

[Alan Mackenzie]

A waste of the court's time

Isn't there a principle under English law that potential legal cases can only be adjudicated when they become actual?

I hope the judicial review judges will judge this review to be premature. That it will only become relevant when such a fine is actually imposed.

I would also hope (but wouldn't expect) the court to rule Meta in contempt of court for attempting to get a reassurance that it can't get meaningful fines imposed on it, and thus can (continue to) ignore the law.

[Blazde]

Re: A waste of the court's time

I don't think this is a totally fair read. They're challenging the calculation as specified in law, not any specific fine. OFCOM themselves acknowledge that industry understanding of the level of penalties is important for enforcement. If Meta doesn't accept them and has some legal reason for that then it's better to get it cleared up quickly, not later if & when they suffer a fine.

However, it does not appear they have any legal basis for challenging them. The appeal amounts to *whine whine whine, it's not fair*. Parliament has already agreed to the calculation and the courts have extremely little leeway when that happens. So it probably will be thrown out swiftly while Meta will hope for some vague PR pay-off for their efforts and that will be that.

[DJV]

"This would still allow Ofcom to impose the largest fines in UK corporate history."

Is that an admission by the Meta spokes-droid that Meta have been doing "naughty accounting"?

[Colin Bull 1]

Ofcom is useless

We are daily subjected to fraudsters, spammers and transgessors of GDPR rules.

Ofcom could do something about them but they would sabre rattle to make the public think they are doing something.

Their friends in the UK telephony industry get a get of jail free card continously

[R Soul]

Re: Ofcom is useless

While I agree Ofcom is useless, GDPS violations are out of scope for them. That rests with another equally useless regulator, the Information Commissioners Office.

[richardnpaul]

Unfortunately for Meta, UK, or British, residents don't stay confined to their borders and so some amount of those global revenues are up for grabs any which way which is where the "qualifying" possibly/probably comes from.

Ofcom should demand that the full amount goes into escrow now whilst they sort out the value in court and that should always be the case with these multinationals, that's a big enough message in itself.

[ecofeco]

Fuck 'em

And fuck 'em hard.

[John Routledge]

I get where Meta are coming from, but this is the only way these fines can really be structured.

Meta (and pretty much every international corporation), like to pretend they have no revenue and make no profit, everywhere except some small island in the Atlantic which won't charge them any tax.

They can't have it both ways.

[doublelayer]

I don't get where Meta are coming from. I suppose there's an argument that, maybe, laws would be nicer if they were structured that way, but you can't win in court by arguing that this is more in the spirit of something politicians should really have been considering at the time. Unless there's some law that prevents the UK from doing this, there's nothing the court can do about it, whether we agree with Meta or not. In the same way, the UK law could have simply written "10% of local revenue or £12 trillion, whichever is higher" and that would be legal too.

[WSWS]

Quite right too, why on earth does the UK government think that they have jurisdiction over money that a US company makes in the US? It has to be approaching the point that they just say "fuck it" and block the UK, then the government will have to answer to millions of angry users who can't get on Facebook anymore. They really are doing their very best to speed run zero seats, aren't they?

[IGotOut]

Why does the US think it has jurisdiction over every other country?

You are aware the EU are doing the same, along with multiple other countries?

[Anonymous Coward]

Yeah, and they should all be flogged.

[Headley_Grange]

It's not about jurisdiction and where the money is made, it's about setting a fine at a level that makes it a deterrent. If they set it at, say, $100M then it would bankrupt some companies but for others it would be pocket money and therefore no deterrent. So they have to make it relevant to the size of the company. If they only based it on UK revenue then it might not be a big enough. Global sales is the best measure of the size of the company.

[Anonymous Coward]

Quite right too, why on earth does the UK government think that they have jurisdiction over money that a US company makes in the US?

First, Ofcom is a regulator. It's not (part of) the UK government.

Next, US companies - particularly in the tech sector - have been taking the piss for decades by exploiting tax havens and accounting scams like transfer pricing to wriggle out of their legal and moral obligations. Using global turnover as the metric when imposing fines cuts through all that crap. It's a clear, unambiguous and internationally recognised number. Which means there's no need to unravel the financial engineering that deliberately obfuscates the source of profits and revenue. Since most of these scams are carried out internationally, it's only fair the penalties that get imposed apply internationally too.

If Facebook (say) only wants to be fined in the UK for the criminality done by its UK operations, they could start by being honest and transparent about the money it makes there.

BTW Using global turnover as the basis for imposing fines started a long time ago. ISTR Microsoft paid billions in fines when the EU eventually woke up and went after them for various (global) market abuses in the 90s.

PS these multinationals only get fined when they break the law and get found guilty. So do that. Duh!

[Anonymous Coward]

You've got it completely backwards. The question is "Why does a US company think it doesn't have to abide by UK law when operating in Britain"?

Whether the UK law calculates the fine based on Uk profits, worldwide profits, or the number of atoms in the universe is completely irrelevant. They don't claim jurisdiction. They use that as a formula to calculate what they think is a fair fine, and that's what the law is based on. Whether that make the law fair or not is a different subject.

If a non-American company worth a number of billions of dollars had an operation in America that only made a thousand bucks a year, if they did something egregious in the USA, would you argue that America can't fine them more than 100 bucks if they break the law, because they made their fortune elsewhere?

[Anonymous Coward]

... you also don't seem to appreciate how important the UK market is to companies like Facebook.

[Anonymous Coward]

Oh no, no more Facebook, what will we all do?

[Anonymous Coward]

Just wait, Mark.

One day OFCOM is going to calculate it based on the start of the calendar year which corresponds to the start of your fiscal year, and the calendar year that corresponds to the end of that same fiscal year.

[Jimjam3]

It’s all about the money.

[Groo The Wanderer - A Canuck]

"The law allows Ofcom to fine companies for up to 10 percent of their qualifying worldwide revenue..."

Screw you, Zuck. Pay up, you thieving fraud!

[chuckufarley]

Oh my! It sounds like Zuck...

...Needs a Waahhmbulance!

[Anonymous Coward]

Imaginary numbers are the way to go

Hmmmm, we *think* your company made £350 billion last year.

Your fine is as follows.

Ten percent of that, times the average British shoe size + VAT = ……

It’s as good as any other calculation method.

[Gavsky]

Treating "...multiple services under the same corporate umbrella as jointly liable" - that's how it works, surely? Corporate management don't have an issue when it's different parts of a group doing 'good stuff' - so the 'family' only splits-up if fined for the bad? Nope.

[NorbertP]

This is one of the rare moments that I find myself rooting for Zuckerberg; notwithstanding the lack of thought that went into the OSA in the first place (both in spirit and in implementation), the amount of overreach Ofcom have displayed is mind boggling, and while Meta themselves are your standard Evil Corporation they have the legal muscle to make Ofcom chill the F out, which might reign in their excessive pursuit of smaller operations that have done their best to comply (e.g. georistricting UK users) but are still being threatened.

[Anonymous Coward]

Your ignorant rant would have been better served if you'd used punctuation and grammar correctly. And used sentences (plural).

Ofcom isn't displaying overreach. It's just obeying orders. Parliament shat out an unworkable toxic turd, pointed at Ofcom and said "implement this - or else!".

Our government's fuckwit politicians have long been captured by the won't anyone think of the children? morons. Contact your MP if you don't like that.

Oh and your idea that Meta will use its legal muscle - as if - to help smaller operations is too silly for words. Meta doesn't need to reach for its lawyers. It can bung a few MPs or wheel out the former ministers it has on the payroll: Nick Clegg for instance. Fuck 'em.

[Anonymous Coward]

Take a page from Trump’s book, Keir

Send in the SAS to snatch up Zuck in chains and toss him in a dungeon somewhere far away.

[MrGreen]

Send Zuk a Tax Bill Instead

The best way to sort this is to send Zuk a tax bill for the billions he hasn’t paid in the UK.

[Anonymous Coward]

Penalty levels

Meta: “We believe fees and penalties should be based on the services being regulated in the countries they're being regulated in”

Nonsense. They should be set at a level to cause Meta to change its cynical, amoral and obnoxious behaviour, which obviously means it should be a proportion of global income.

[Anonymous Coward]

Spending on the wrong things!

If only it spent the money it's using to fight potential claims before they are breached on just confirming to them?

Such a scummy company I hope all the $B being spent on AI by them takes them down.