Meta Platforms will offer users in Europe ad-free access to Facebook and Instagram for a subscription fee after courts in the region began cracking down on the way social media companies treat data.
Starting in November, users will be able to subscribe to the social media sites for €9.99 per month on the web or €12.99 per month via Apple’s and Android’s mobile operating systems, the company said in a statement on Monday. The subscription services will be offered to anyone in the European Union, Iceland, Liechtenstein, Norway and Switzerland.
The subscriptions are a reaction to increasing regulations around how user data is collected and used in Europe. In a blog post explaining the decision, Meta cited the EU Court of Justice’s decision that went against the company in July. The court said at the time that businesses should consider offering an alternative service for customers who don’t want their data collected and sold to advertisers “if necessary for an appropriate fee”.
“We’ll continue to advocate for an ad-supported internet, even with our new subscription offering in the EU, EEA and Switzerland,” the company said in the statement. “But we respect the spirit and purpose of these evolving European regulations, and are committed to complying with them.”
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The company’s shares rose as much as 4.3 per cent to $309.40 in New York trading Monday. The stock had closed at $296.73 on Friday.
Meta will continue offering ad-supported services in these markets without an additional charge. While the subscription fees will initially cover all of a user’s accounts, starting in March, Meta will charge an additional €6 per month on the web and €8 per month on mobiles for each additional account.
The Data Protection Commission in Ireland, which oversees Meta for the EU, said it hasn’t finished analysing whether the move satisfies requirements under the General Data Protection Regulation, better known as GDPR.
“The exercise has not yet concluded, and no findings have been made to date,” the commission said in a statement. “It is due to be completed shortly, at which point the DPC will notify Meta if it considers that the manner in which its new user offerings are to be implemented is compatible with Meta’s obligations under GDPR.”
Big tech companies are making more changes to their European products to comply with increasing scrutiny from regulators. This is most prominent in the European Union, where courts and data protection authorities are slapping companies with fines worth billions of euros for compliance with data protection rules, and new competition and content moderation rules are going into effect.
Meta also decided not to launch its X rival, Threads, in the EU due to questions about how it can adhere to the EU’s Digital Markets Act, which prohibits major tech companies from sharing data between services.
The company said that the new European subscription model has been “factored into” its most recent business outlook and guidance. - Bloomberg
