Meta, the parent company of Facebook, is allegedly looking into adding a paid subscription service to the social media platform and Instagram for its EU customers to address concerns around data privacy and ads.
There is currently no information on exactly how much the subscription would be or when the company would roll it out. Additionally, whether or not the paid subscription idea will push through has not been confirmed.
Meta's Planned Paid Subscription
The situation comes as Meta has been fighting with the EU and several other European regulators regarding alleged privacy violations by the company's ad-tracking services and data transfers.
Previously, Ireland's Data Protection Commission fined Meta $1.3 billion for transferring data of European users to the United States, which is considered a violation of the EU's General Data Protection Regulation (GDPR). In July, the U.S. and the EU signed a data transfer agreement, easing restrictions on social media platforms, as per The Verge.
The social media company has already started offering the ability for users to opt out of targeted advertising if they are from the EU. Meta also reportedly proposed going further and shifting it to an opt-in option for everyone in the region.
Additionally, Meta delayed the release of its new platform, Threads, in the region because of regulatory concerns. The company is concerned about the approaching Digital Markets Act that would prevent companies from reusing personal user data, including their name and location.
The potential move highlights how tech companies, including Meta, may be forced to redesign products to comply with new regulations, especially in Europe. Various regulations limit how companies can use users' data for advertising.
While having an ad-free experience can help Meta address regulatory concerns about its current business model, according to Neowin, it is uncertain how many users would be on board for such an idea.
Digital Regulations in the EU
Additionally, Meta was forced to take some action to prevent users from the EU from accessing its delayed Threads app using VPNs back in July. The company has not yet released any information on its plans to release the new app in the EU, but it could become available later this year and include an ad-free subscription.
Most of Meta's revenue is from selling targeted ads, and the European Union accounts for roughly 10% of the company's overall ad business. This makes the region the second-most lucrative region, just behind North America.
Meta's core business for the last two decades has focused largely on offering free social networking services to its users and selling advertising to companies looking to reach that audience.
In a statement, a Columbia University law professor, Anu Bradford, the author of "Digital Empires: The Global Battle to Regulate Technology," said that the situation shows that tech companies are complying with the EU's digital regulations. According to the New York Times, she suggests that companies remain beholden to governments and not vice versa.
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