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> Economy

Meta considers charging European users a subscription fee to avoid seeing ads

The proposal is an attempt by Meta to circumvent European Union rules

Newsroom October 3 03:47

Meta Platforms is working on options to introduce a subscription model that comes with an ad-free allowance for Instagram and Facebook users in Europe, a source with knowledge of the matter said.

Although various pricing schemes are being discussed, the proposal for a monthly subscription of EUR 10 is the most prevalent, according to the source.

The proposal is an attempt by Meta to circumvent European Union rules that threaten to restrict its ability to personalise ads for users without their consent, hitting its main source of revenue.

Offering a choice between an ad-supported free model and an ad-free subscription scheme could shift users towards the latter, helping Meta comply with European regulations without hurting the advertising market from which it derives revenue.

Meta’s new plan is more expensive than the Netflix network subscription that charges €7.99 for its basic package.

On mobile devices, the price of an individual account will jump to around 13 euros because Meta will factor in the commissions charged by Apple and Google’s app stores, according to a Wall Street Journal report.

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In February, Meta was fined 390 million euros by Ireland’s privacy commissioner in February and told that it cannot use the so-called “contractual” legal basis to send users ads based on their online activity, which hurts the company’s business model.

Meta subsequently announced its intention to ask users in the European Union for consent before allowing businesses to target ads in order to meet ongoing regulatory requirements in the region.

A Meta spokesperson said the company believes in “free services supported by personalised ads” but is “considering options to ensure compliance with ongoing regulatory requirements”.

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