Meta plans to offer EU customers an ad-free version of Instagram on their phones for $14 a month. For $17, the company will bundle ad-free Instagram with an ad-free version of Facebook on desktop.
The plan is a means for Meta to monetize its platforms in the face of a tougher regulatory climate in Europe compared to the U.S.
Meta and adverts
European Union rules are forcing Meta to rethink its business model across the region. Meta monetizes all of its platforms through ad revenue. But in Europe, regulators take a dim view of the data-harvesting Meta needs to power its personalized ad programs.
Meta has made concessions to regulators, but pressure continues to be applied to the firm. Meta’s first feature made it possible for users to opt out of personalized ads, but customers had to seek the option out.
Given that the option was difficult to find, most customers didn’t bother. For that reason, the move didn’t go far enough as far as regulators were concerned, prompting further concessions.
To further placate regulatory concerns, Meta will soon have to actively seek consent to offer personalized ads. Customers will be asked to opt in or opt out. Since many will choose to opt out, ad revenues are expected to take a major hit following its implementation.
In September, Meta chiefs in Ireland met with EU regulators to see what points of agreement might be sought. Ireland is the EU’s lead privacy regulator for the company, owing to the fact that its EU headquarters are in the country. Meta also spoke with digital competition regulators from Brussels and other officials from right across the block.
Seeking input from regulators and bringing them on board prior to launching their subscription service should mean Meta can avoid further regulatory problems down the line. It is not yet clear whether this plan will be entirely effective in getting the regulatory monkey off Meta’s back.
U.S. customers see no change
Although an ad-free version of Meta products will be available in Europe, U.S. customers should not expect a similar product in the near future.
Mark Zuckerberg has opposed ad-free variants of the platform for some time, maintaining that Instagram and Facebook should be free at the point of use.
This approach is in contrast to Elon Musk’s X, which has rolled out subscription models in exchange for verified status.