Undergoing Paid Review to Avoid Strict EU Regulations
Reports have emerged that paid versions of Facebook and Instagram are under consideration for launch in the European Union (EU) region.
The New York Times reported on the 1st (local time) that Meta, the parent company of Facebook and Instagram, is considering launching a paid service that removes ads from Facebook and Instagram in response to the EU's privacy regulations.
Users would pay a fee to eliminate personalized ads based on their personal data. This is seen as a way to address privacy concerns and help avoid investigations by EU regulatory authorities.
Even if the paid service is launched, the current free versions will continue to be offered.
The New York Times stated that no specific launch schedule or pricing information for the paid service has been disclosed.
So far, Meta has faced numerous sanctions in the EU due to its use of personal data on Facebook and Instagram.
In July, the European Court of Justice (ECJ) ruled in favor of Germany's Federal Cartel Office, the country's antitrust regulator, in a lawsuit filed by Meta against the decision that prohibited Meta from collecting personal data without consent for Facebook advertising purposes.
These EU regulations are based on the General Data Protection Regulation (GDPR), which officially came into effect in 2018. It is a law aimed at protecting personal data online.
Additionally, last month the EU officially enacted the Digital Services Act (DSA), which strictly limits personalized recommendations based on personal data. This law strongly restricts the provision of personalized ads based on individual preferences and requires transparency in recommendation algorithms.
Violations of this law can result in fines of up to 6% of the annual global revenue. For example, if Meta violates the DSA, it could face fines amounting to $6.996 billion, which is 6% of its 2023 annual revenue of $116.61 billion. Repeated violations could lead to Meta being barred from conducting business in the EU.
Europe is Meta’s second most profitable region after North America, with advertising in this region accounting for 10% of total ad revenue.
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