In response to changing European regulations, Facebook and Instagram are set to roll out a new subscription service for users in the EU, EEA, and Switzerland. Starting in November, users from these regions will have the option to either continue using the platforms for free, supported by ads, or pay a subscription fee to enjoy an ad-free experience. Crucially, while subscribers won’t see ads, their information will also remain untouched for advertising purposes.
The subscription cost is set at €9.99/month for web users, while those on iOS and Android will be charged €12.99/month. Importantly, this fee covers all linked Facebook and Instagram accounts in a user’s Accounts Center, though only until March 1, 2024. Post this date, an extra charge, amounting to €6/month on the web and €8/month on mobile platforms, will be levied for each additional account in the user’s Accounts Center.
The Driving Force
While the internet’s ad-supported model offers users personalized experiences regardless of financial standing and enables businesses to tap into potential markets, the introduction of this subscription model is a move to align with the evolving European regulations.
This transition was hinted at in August when the intention to shift EU, EEA, and Swiss users to the GDPR’s “Consent” legal basis was announced. This adaptation addresses the nuanced and dynamic regulatory requirements of the region, considering both the Irish Data Protection Commission’s interpretation of the GDPR and the impending enforcement of the Digital Markets Act (DMA).
In fact, the Court of Justice of the European Union (CJEU) has acknowledged that such a subscription framework is a legitimate expression of consent for an ad-based service.
The User Experience
For users who opt to stick with the free version, their interaction with the platforms remains unchanged. Tools like Ad Preferences, which allow users to curate their ad experience, and the “Why am I seeing this ad?” feature will still be at their disposal.
Advertisers too can carry on with their personalized ad campaigns in Europe, targeting users who prefer the ad-supported model. As part of its ongoing commitment, the company will continue its efforts to devise innovative tools that maintain the value of personalized advertising while offering users greater control over their ad experiences.
This subscription model, aimed at those 18 and above, also throws light on the company’s intent to rethink ad experiences for teens, given the shifting regulatory terrain.
Impact on Business
The introduction of this new model has already been integrated into the company’s latest business outlook. However, it’s important to note that these are forward-looking statements, reflecting the current views about Meta’s business trajectory and the regulatory landscape. For a comprehensive understanding of the potential risks and uncertainties associated with the business and its financial results, a glance through the most recent Form 10-Q is recommended.
