Technology conglomerate Meta has been the talk of the town of late. A few hours back, the company released its revenue figures. Its earnings had been hit hard by its spending on the metaverse and its slowing growth in social networking and digital advertising. Amid all this, the company has been ordered to pay roughly $25 million to the state of Washington for violating the state’s law on online political ads.
Meta in hot water?
Seattle Judge Douglass North has ruled that the social media giant will have to pay $24,660,000 for 822 violations of the states’ law mandating transparency in political ads. Per the Judge, Meta intentionally and repeatedly breached the state’s laws since over the last few years and committed hundreds of violations. Outlining the same, the official release noted,
“Today, Judge North ordered Facebook to pay the maximum penalty: $24,660,000. This represents the largest campaign finance penalty anywhere in the country—ever.“
Per Washington’s transparency law, advertising sellers like Meta are required to keep and publicize the names and addresses of those who buy political ads, the target of ads, the payment method, and the total number of views. Ad sellers must provide information to anyone who asks for it.
But Meta has repeatedly objected to the requirements and has contended that the law is unconstitutional because it “unduly burdens political speech” and is “virtually impossible to fully comply with. Even though the company keeps an archive of political ads that run on the platform, it does not disclose all the information required under Washington’s law.
Here it is worth recalling that in 2018, the company agreed to pay $238,000 and committed to transparency in campaign finance and political advertising.
Commenting on the latest ruling, Attorney General Bob Ferguson said,
“I have one word for Facebook’s conduct in this case—arrogance. It intentionally disregarded Washington’s election transparency laws. But that wasn’t enough. Facebook argued in court that those laws should be declared unconstitutional. That’s breathtaking. Where’s the corporate responsibility?”
He further urged the company to “come to its senses, accept responsibility, apologize for its conduct and comply with the law.”
Meta’s stock tumbles
Alongside the said charges, Meta’s metaverse revenue dropped by almost half from a year earlier to $285 million. Its loss widened to $3.67 billion from $2.63 billion in the same quarter last year. Nevertheless, the company expected things to turn around in the long run. It said,
“We do anticipate that Reality Labs operating losses in 2023 will grow significantly year-over-year. Beyond 2023, we expect to pace Reality Labs investments such that we can achieve our goal of growing overall company operating income in the long run.”
People from the industry have been outrightly reacting to the same and claiming that it’s time for meta to step out of the metaverse and come back to reality to rescue itself. There are a few also advocating that only Elon Musk buying the company could change its fate at this stage.
Owing to the pessimism, Meta’s share price tumbled to multi-year lows in the after-trading hours. Post noting an almost 20% decline, META was trading at $104.3, its lowest since March 2016.
