Meta, the parent company of social media giants Facebook and Instagram, is considering a new strategy to navigate the European Union’s stringent ad privacy rules. In response to the EU’s insistence on granting users the choice to opt out of personalized advertisements based on their online activities, Meta is mulling over the idea of charging users a monthly subscription fee.
Under this proposed plan, users who opt not to have personalized ads will be required to pay a monthly fee, which would start at approximately €10 ($10.50) for desktop Facebook or Instagram accounts. For mobile device accounts, the fee would be slightly higher, around $14, due to commissions imposed by Apple and Google’s app stores.
The aim of this subscription-based model is to enable users to use Meta’s products without being subjected to targeted ads. However, it remains uncertain whether EU regulators will view this plan as compliant with their laws.
Personalized advertising, a fundamental element of Meta’s business model, has faced growing challenges. Notably, Apple’s introduction of the opt-out feature for ad-tracking in 2021 significantly impacted Meta’s revenue, causing an estimated loss of $10 billion.
This potential subscription approach underscores how Europe’s rigorous regulatory stance is compelling tech behemoths to overhaul their business strategies. Meta had already been slapped with a substantial $1.3 billion fine by European regulators for breaching data privacy standards, further demonstrating the strict regulatory environment in the EU.
In response to these developments, a Meta company spokesperson emphasized Meta’s belief in the value of free services supported by personalized ads. However, the spokesperson also highlighted Meta’s commitment to exploring options that ensure compliance with evolving regulatory requirements. The future of this subscription model hinges on its alignment with EU laws and the adaptability of Meta to navigate this evolving landscape.
