Algorithmic Transparency and Competitive Advantage : Meta’s Strategic Response to European Data Privacy and Digital Services Regulation

Sammanfattning

This thesis examines Meta’s strategic response to the European Union’s evolving algorithmic transparency regulations, focusing on the General Data Protection Regulation (GDPR), Digital Services Act (DSA), and Artificial Intelligence Act (AI Act). Employing a qualitative single-case study, the research integrates doctrinal legal analysis, business strategy frameworks (Resource-Based View and VRIO), and natural language processing (NLP)-augmented thematic analysis to explore how Meta interprets and operationalizes transparency requirements. The findings reveal that while Meta has developed various transparency tools to meet regulatory obligations, these mechanisms often prioritize formal compliance over substantive, user-empowering transparency. Technical opacity, incomplete disclosures, and symbolic compliance persist, limiting both user trust and the strategic value of transparency initiatives. Although Meta’s transparency practices can enhance engagement and serve as rare strategic resources, their competitive advantage is undermined by persistent gaps in explainability and user empowerment. The study concludes that meaningful algorithmic transparency in the EU requires not only clearer regulatory standards and robust enforcement but also genuine organizational commitment to user-centered design and accountability. The thesis offers actionable recommendations for regulators, platforms, and researchers, contributing new insights into the intersection of law, business strategy, and digital platform governance.