Meta’s making more changes to its ad-free subscription offering in Europe, in order to meet ever-changing EU requirements on data usage and consumer protections.
Today, amid ongoing scrutiny from EU officials, Meta has announced that it’s cutting the price of its ad-free subscription offering in the region by 40%, in the hopes of enhancing its appeal to regulatory groups.
As explained by Meta:
“Going forward, people based in the EU will still have the option to choose between subscribing for an ad-free experience or continuing to access our services for free. For those people who choose to continue using our services for free, they’ll now also be able to choose to see less personalized ads. However, we remain committed to personalized advertising, which will always be the cornerstone of a free and inclusive internet.”
To recap, back in November last year, in response to new EU rules which dictate that social platforms have to offer an opt-out from targeted ads, Meta announced that it would provide a new, ad-free subscription offering for EU users, which would enable access to both Facebook and Instagram for €9.99 per month without any personal data gathering.
That, in effect, met the new EU requirements, in that it would enable users to opt out of data sharing for ad purposes, while it would also ensure that Meta’s business was not significantly impacted by those doing so.
But various advisory groups challenged Meta’s subscription alternative, arguing that it undermined the focus of the GDPR, and its protections against “data capitalism”. That led to more scrutiny from EU officials, which saw Meta offer to halve the price of the option back in March in order to make it more accessible, and appease such concerns.
At the same time, Meta has also been forced to add in an option for all users to see “less personalized ads”, ensuring that even those who don’t subscribe to its ad-free option can opt out of full data sharing if they choose.
Which it’s clearly trying to make a less appealing option:
“This means people will see ads that they don’t find as interesting. This drop in relevance is inevitable given that drastically reduced data is being used to show these less personalized ads to people. In a low data environment, we will also introduce ad breaks to allow advertisers to connect with a wider audience. This means that some of the ads people will see in the less personalized ads experience will be unskippable for a few seconds.”
So you can opt to not pay for the ad-free option, but Meta’s gonna’ make it a more annoying experience.
The idea, then, is that Meta will be able to offset its losses in not utilizing personal data for ad targeting by getting as many people as possible who opt out to pay a monthly fee. Which will now cost a lot less than its initial offering, and it’s feasible that at least some EU users will pay up to avoid data sharing.
But most won’t, and if they want to get fewer, more annoying ads in-stream, they’ll need to opt in to Meta using their data for ads, essentially maintaining the status quo in the app, despite the new EU data restrictions.
I’m guessing EU regulators and advisory groups won’t be happy about this new compromise either, especially considering Meta’s overt efforts to push people towards its money-making options.
But at the same time, Meta has the right to minimize its losses where it can, and if you’re going to force it into a system that will reduce its revenue intake, free market rules would dictate that Meta can respond to that as it chooses.
Or you’re arguing that Facebook and Instagram are public utilities, and as such, should be subsidized by the government. Which they’re not, so as a private entity, I’m not sure how much further the EU can stretch Meta to meet its requirements, without unfairly impacting regional trade.
Either way, Meta will be hoping that it’s made enough compromises to adhere to these new EU rules, while also ensuring that it doesn’t lose out as a result.
