Business US media report
Pay for Instagram and Facebook? This is behind the subscription plans
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Meta is apparently considering introducing payment models on Instagram and Facebook in Europe. The US group should primarily want to react to stricter EU requirements. Because data protection rules are increasingly calling the previous business model into question.
Meta is apparently considering introducing a paid subscription for its Instagram and Facebook networks in Europe. According to the plan, those who pay for the services should no longer see any advertising in the apps. At least that’s what the “New York Times” reports, citing informants. However, it is still unclear how much the paid versions of the apps would cost or when the company could introduce the subscription models.
The parent company of Facebook and Instagram could want to react to stricter data protection regulations in the EU with the plans, it is said. It was not until July that the European Court of Justice (ECJ) confirmed a decision by the Federal Cartel Office after several years of negotiations. The German competition authority declared in 2019 that Meta had abused its market power by collecting certain data from users without their express consent. It was about personal information that users left behind on the company’s own services such as WhatsApp or Instagram. With reference to data protection, the Cartel Office had prohibited the company from merging user data from different sources.
In addition, Meta is also likely to feel the consequences of the so-called “Digital Services Act” of the EU, which came into force in full a few days ago. This requires more transparency in online services when it comes to data usage. In addition, particularly sensitive data such as sexual orientation or state of health may no longer be used for targeted advertising. And further trouble is already looming: With the so-called “Digital Markets Act”, the EU is already working on plans to further curtail the market power of the big tech companies.
Meta’s previous business model under threat
The fact that the EU is now tightening the reins threatens Meta’s previous business model. For almost 20 years, the core business of the Facebook group has been to offer the use of the networks free of charge and instead to sell advertising to companies that want to reach very specific target groups. To do this, Meta collects all user data across its platforms.
In January, Mark Zuckerberg’s company was already in trouble for its collection practices. Irish regulators fined Meta €390 million. They believed that the group forced its users to accept personalized advertising as a condition of using Facebook. According to the head of the Federal Cartel Office, Andreas Mundt, Meta is forcing its users to make the wrong choice: either they use the services and have to pass on their data, or they have to avoid Meta’s social networks altogether, he explained.
A new payment model for the meta-networks could now refute this accusation. After all, users would now have the choice of paying for an ad-free version without data transfer. Meta did not want to comment on the plans to the New York Times. According to the report, frugal users shouldn’t have to worry. Meta will continue to offer free versions of Facebook and Instagram with ads in the EU, it said.