EU vs. Meta

Brussels Targets Meta’s WhatsApp AI

The EU has opened an antitrust probe into Meta’s use of AI tools within WhatsApp, a messaging app with over three billion active users.

Regulators say Meta’s approach may block rival AI providers from reaching users. Meta integrated its AI chatbot into WhatsApp in March, and has announced an update restricting access for competing chatbots.

EU antitrust chief Teresa Ribera warned the EU must move quickly to “prevent any possible irreparable harm to competition in the AI space.”

Chatbots Meet Antitrust Law

The Meta case is among the first to test how competition law applies to generative AI. Regulators worry dominant platforms could lock users into proprietary assistants (like Meta offering Meta AI on WhatsApp), limiting choice and innovation.

Meta calls the claims “baseless,” citing system strain from external AI and the ease of accessing competing chatbots via other platforms.

The European Commission counters that booming AI markets need open access. The outcome may set a precedent for AI integration across messaging, search, and cloud.

Brussels Builds the Rulebook for Digital Markets

The EU has become the world’s toughest regulator of technology. Over the past decade, it has fined Google billions for search bias, Apple for App Store restrictions, and Meta for forced consent models.

Now, three landmark regulations define Europe’s approach:

• Digital Markets Act (DMA): Since 2022, “gatekeepers” like Google, Apple, and Meta face strict rules on messaging, app stores, and cloud services.
• Digital Services Act (DSA): Focuses on online safety, transparency, and accountability of platforms.
• Artificial Intelligence Act (AI Act): Adopted in 2024, it sets a global precedent by banning harmful AI uses.

US Pushback on EU AI Rules

The Whitehouse views strict EU laws as attacks on American firms. The US President has threatened to set more tariffs on countries with “discriminatory” digital rules.

Under pressure, Brussels has proposed delaying parts of its AI Act until 2027, involving oversight of high-risk systems. Critics say Europe’s role as a global standard-setter is at risk, while supporters argue this could boost innovation.

The EU is lagging behind the US, with not a single European company among the top 20 most valuable public firms in the world.

EU Rules Can Shape Markets

For investors, regulation itself is a market mover. When a company adjusts to stricter EU rules, changes are often applied globally.

Just like interest rate hikes or inflation data releases, new rules and antitrust probes can reshape valuations.

• EU antitrust fines can reach up to 10% of global revenue.
• Probes may trigger share price volatility in targeted firms.

In Meta’s case, the probe was overshadowed by the news of Meta scaling back its controversial metaverse investments. A promise of huge cost cuts sent the shares up on Thursday.

Breakups and Fines That Changed the Game

Antitrust refers to rules that stop companies from abusing market power or blocking fair competition. Some cases have left lasting marks on global markets:

• Standard Oil (1911): Split into 34 firms, defining US monopoly law.
• AT&T (1982): Breakup opened telecom markets in the US.
• Microsoft (1998): Case curbed software bundling, influencing the rise of other tech giants.
• Google EU fines (2017–2019): Billions in penalties for search bias and Android dominance.
• Apple (2024): €1.8 billion fine for App Store restrictions on music streaming. Separately, Apple lost a fight over a €13 billion tax recovery order by the EU — a state aid case, not antitrust.