Meta
Platforms has proposed charging a monthly fee for use of its Instagram and Facebook social networks without advertising. It’s the company’s latest bid to tackle European Union rules around personalized advertising.
Meta
(ticker: META) has made the proposal to EU regulators in recent weeks and hopes to roll out the charging plan in the coming months for European users, The Wall Street Journal reported, citing people familiar with the matter. The plan wouldn’t be available for U.S. users.
The introduction of a monthly charge would be a major departure for Meta, which has always designed its core services to be free for the user but supported by advertising. That’s a sign of how serious a threat its business model faces from EU demands to allow users to opt out of personalized advertising based on user data.
The proposed price for the ad-free offerings would be €10, or roughly $10.50, a month on desktop on a Facebook or Instagram account, and roughly €6 for each additional linked account, with the base price rising to €13 a month on mobile devices, according to the report.
Meta declined to confirm or deny the ad-free charging plans when contacted by Barron’s.
“Meta believes in the value of free services which are supported by personalized ads. However, we continue to explore options to ensure we comply with evolving regulatory requirements,” a Meta spokesperson said.
Meta’s has faced a series of challenges in complying with stricter EU rules around the use of user data. Meta was hit with a $1.3 billion fine earlier this year by EU regulators for sending user information to the U.S. The company hasn’t launched its Threads microblogging platform in the EU due to the bloc’s technology regulations, which limit how user data can be shared across different platforms.
Meta’s proposal is unlikely to end the wrangling. EU regulators might object that the ad-free pricing is too high and insist on a lower price or that a free version of Meta’s services be made available with the ability to opt out of personalized advertising. That would put Meta’s business model to the test and could even renew questions over whether it might withdraw from Europe.
Write to Adam Clark at [email protected]
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