Meta may soon begin to allow Instagram and Facebook users the chance to avoid ads by taking out a subscription, sources familiar to the matter told the New York Times.
Despite the addition of a new, paid for subscription service, Meta would continue to offer its sites and apps for free. It’s currently unclear how much the company intends to charge should it move forward with the plan.
The move to offer paid versions of the company’s biggest apps comes as a response to increased regulations regarding how Meta collects and uses the data of consumers, and suggests that there will be a divergence in how people in Europe and the USA experience and engage with technology. The move may help Meta avoid further scrutiny from EU regulators, who barred Meta from combining data from its numerous platforms such as Whatsapp, Instagram, and Facebook in July. The company was also fined 390 million euros in January, due to Facebook forcing users to accept personalised ads as a condition of using the service.
Among other fines faced by the company due to its mishandling of user data are a 265 million euro fine following a data leak in 2023, a further fine of 17 million euros for a separate leak, and a 225 million fine levied by Irish regulators due to violations involving Whatsapp.
Regular business
Due to the litany of cases, the company has been on something of a backfoot in the European market. The company hasn’t released its latest app Threads in European countries due to these regulatory concerns. Meta insiders believe that offering a choice of services will help to alleviate concerns of regulatory bodies, even though the mobe may prove unpopular.
Meta is currently valued at $761.10 billion, and saw a maximum valuation of $1.065 trillion in September 2021. As such, the company remains successful, despite a fall in value, and the company can likely afford a potential loss should few people decide to take advantage of its new offering.
Notably, Europe is Meta’s second most lucrative market, following North America. CFO Susan Li noted in April that advertising in the European Union represented 10% of the company’s $117 billion in revenue for the year. As such, Meta has a significant financial incentive to appease the region’s regulators.
In July, we reported that Meta, among others, had six months to comply with the new Digital Markets Act.
