Meta Considers Charging European Users for Ad-Free Facebook and Instagram

Meta is considering releasing paid versions of Facebook and Instagram users residing in Europe in response to the European Union's (EU) impending Digital Services Act, which would ban Meta ads in Europe.

People who opt for Facebook and Instagram subscriptions will not see these ads, while Meta will continue to offer free versions of its apps, which will still serve Meta ads regardless of the ban.

This ban could significantly affect the brand reach and campaign performance. Though it is being considered for Europe, it may extend to the USA in the future. Advertising agents should closely monitor this development as a hawk, as they may need to consider reallocating their ad spend to other social media platforms with a new digital marketing strategy.

Content posted on these platforms is essential, as it attracts Facebook lead generation, which is crucial for meta-marketing. Marketing and sales are vital for any business to prosper, and to generate more leads, we need to post content and advertise different types of data, products, and services.

This is when ad copy comes in. Ad copies are nothing but the content related to a company's service or product that is being advertised. An ad copy has a title/headline, primary text, and call description. Your business can only reach a large audience with advertisements, hence the low Facebook lead generation.

Instagram ads manager is the starting point for having your ads running on the Instagram app for your business.

Why the ban now?

Facebook and Instagram subscriptions have been suggested in response to the European Union's Digital Services Act, which will come into effect on January 1,2024. Under the new regulations, Google and Meta, the large platforms with more than 45 million users, are scrutinized to create a safer digital space and to establish a level playing field for businesses with digital marketing services.

This move can help Meta combat the user's privacy concerns and other scrutiny from the EU. It would give users an alternative to the company's ad-based services, which rely on analyzing user's data.

Although it is still being determined how much the ad-free Facebook and ad-free Instagram app versions would cost, this move will acquire users.

For nearly two decades, Meta's principal business has been providing free social networking services to users and selling advertising to companies looking to reach that audience. Adding a premium paid tier would be one of the most visible examples of how corporations will have to redesign products to comply with data privacy laws and other government restrictions, particularly in Europe.

In July, the European Union's highest court essentially prohibited Meta marketing from aggregating data collected about users across its platforms, including Facebook, Instagram, WhatsApp, and third-party websites and apps, unless users provided specific consent. In January, Irish regulators penalized the firm 390 million euros for forcing users to accept personalized ads as a condition of accessing Facebook.

Meta's willingness to create paid subscriptions shows how residents of the European Union, consisting of 27 nations and 450 million people, may begin to see various versions of consumer technology products due to new laws, regulations, and court judgments.

TikTok and Instagram meta users in the region have been able to restrict personal data from being used to produce their social media feeds in recent weeks, as a new EU law known as the Digital Services Act went into force to curb the flow of illicit information online. Snapchat and Meta have barred digital marketing companies from targeting teens aged 13 to 17 in Europe with personalized ads.

Another EU tech-focused law, the Digital Markets Act, will go into effect next year. This is anticipated to compel giant digital marketing service platforms to adapt critical business practices to boost competition, with Apple allowing customers in the European Union to download alternatives to the App Store on iPhones and iPads for the first time.

Because of regulatory concerns, Meta has not released its new app Threads, a rival to X, formerly known as Twitter, in Europe.

After North America, Europe is Meta's second most profitable region. According to Susan Li, Meta's chief financial officer, advertising in the EU accounts for 10% of the company's total revenue. Last year, Meta's sales were over $117 billion.

According to two Meta marketing sources, allowing users to opt out of an ad-based service while still accessing an ad-free Facebook version or an ad-free Instagram version could minimize certain European authorities' concerns. Even if few people use the paid version, making it available could serve Meta's regional interests.

Aside from its European issues, Meta is attempting to revitalize its business after global economic uncertainty impeded ad-sales growth. It is also still promoting its vision of the immersive digital world of the metaverse, an expensive project championed by the company's CEO, Mark Zuckerberg, which is still in its early stages. Executives are also working to build artificial intelligence technology and incorporate them into more of Meta's goods.

The business has yet to comment on the possibility of launching commercial versions of Facebook and Instagram. However, when Meta CEO Mark Zuckerberg testified before the US Senate in 2018, he hinted that such a product could be on the horizon. When asked if he would consider charging users for access to his apps to eliminate adverts, he stated, "There will always be a free version of Facebook."

• Sheryl Sandberg, COO of Meta, then added: "We have various types of opt-out. At the highest level, there is no opt-out. That would be a paid item."