Meta is considering paid versions of Facebook and Instagram that would not include advertising for users in the European Union, said three people with knowledge of the company’s plans, in response to the regulatory scrutiny and a sign of how people are using technology in the United States and Europe experience may vary due to government policies.
Those who pay for Facebook and Instagram subscriptions won’t see any ads on the apps, said the people, who spoke on condition of anonymity as the plans are confidential. This could help Meta fend off privacy concerns and other scrutiny by EU regulators by offering users an alternative to the company’s advertising-based services, which rely on analyzing people’s data, the people said.
Meta will continue to offer free versions of Facebook and Instagram with advertising in the European Union, it said. It’s unclear how much the paid versions of the apps would cost or when the company might launch them.
A Meta spokesman declined to comment.
For almost 20 years, Meta’s core business has been providing users with free social networking services and selling advertising to companies that want to reach this audience. Deploying a paid tier would be one of the most tangible examples yet of companies having to redesign their products to comply with privacy regulations and other government directives, particularly in Europe.
In July, the European Union’s highest court effectively banned Meta from combining data collected about users on its platforms — including Facebook, Instagram and WhatsApp — and from external websites and apps, unless it obtained users’ explicit consent . In January, the company was also fined €390 million by Irish regulators for forcing users to accept personalized ads as a condition of using Facebook.
The rulings stemmed from the passage of Europe’s General Data Protection Regulation (GDPR) in 2018, which was landmark law designed to protect people’s online privacy.
Meta’s openness to creating paid subscriptions shows that people across the European Union, which comprises 27 countries and approximately 450 million people, may see different versions of consumer technology products due to new laws, regulations and court rulings.
When a new EU law called the Digital Services Act came into force in recent weeks to curb the flow of illegal content online, TikTok and Instagram users in the region could also opt out of having personal data used to create their social Block media feeds. Snapchat and Meta have prevented marketers from targeting teens aged 13-17 in Europe with personalized ads.
Another technology-focused EU law, the Digital Markets Act, will come into force by next year. This will force major technology platforms to change certain business practices to encourage competition and will have far-reaching implications. Apple is expected to allow users in the European Union to download alternatives to the App Store on iPhones and iPads for the first time.
“This shows that tech companies are complying with the EU’s digital regulations, suggesting they remain committed to governments and not the other way around,” said Anu Bradford, a law professor at Columbia University and author of “Digital Empires: The Global Battle to Regulate Technology.” .”
Meta, which includes Messenger, has come under particular scrutiny from EU regulators. In May, the bloc fined the Silicon Valley company 1.2 billion euros for violating its data protection laws by sending European citizens’ data back to U.S. servers to improve the company’s advertising technology. Meta has appealed the ruling.
Meta has been fined for further GDPR breaches, including a €265 million fine for a data breach in 2021. Irish regulators have also fined €225 million for breaches in a case involving WhatsApp and another €17 million Euro fined due to a data leak.
Some Meta insiders believe that allowing users to opt out of an advertising-based service while still having access to a paid version of Facebook or Instagram could ease the concerns of some European regulators, two of the people said. Even if few people choose the paid version, providing such an option could serve Meta’s interests in the region, they said.
Meta has not released its new app Threads, which is a competitor in Europe to X, formerly known as Twitter, for regulatory reasons.
Europe is the second most lucrative region for meta after North America. Susan Li, Meta’s chief financial officer, said in April that advertising in the European Union accounted for 10 percent of the company’s total business. Meta’s revenue was nearly $117 billion last year.
Beyond its European challenges, Meta is trying to renew its business after global economic swings hampered ad sales growth. The company also continues to advance its vision of the immersive digital world of the Metaverse, an expensive project promoted by Mark Zuckerberg, the company’s chief executive, that is still in its infancy. And executives are focused on developing artificial intelligence technologies and integrating them into other Meta products.