Meta Plans a $14 Ad-Free Subscription Service for Instagram and Facebook Users in the EU

Meta Stock

Meta Platforms (NASDAQ:META) is considering the introduction of ad-free subscription plans for Instagram and Facebook users in Europe, according to sources familiar with the matter. The move is in response to European Union regulations that could restrict Meta’s ability to personalize ads for users without their explicit consent, potentially impacting its primary source of revenue.

While various pricing plans have been discussed, one source mentioned that a 10 euro ($10.49) per month plan appears to be the most viable option. Another source indicated that the subscription service could be rolled out in the coming months.

The strategy behind offering a choice between a free, ad-supported plan and a paid subscription is to allow users to opt for the free plan, thereby helping Meta adhere to regulations without significantly affecting its advertising business.

On mobile devices, the subscription cost for a single account may increase to approximately 13 euros due to commissions charged by Apple’s and Google’s app stores, as mentioned by the second source.

For comparison, popular streaming service Netflix (NASDAQ:NFLX) charges 7.99 euros for a basic subscription plan, while Alphabet’s (NASDAQ:GOOGL) YouTube Premium is priced at about 12 euros, and Spotify’s (NYSE:SPOT) Premium service costs around 11 euros.

Meta had faced regulatory scrutiny earlier in the year when it was fined 390 million euros by Ireland’s Data Privacy Commissioner. The company was instructed not to use the “contract” as a legal basis for delivering ads based on users’ online activities. Consequently, Meta announced its intention to seek users’ consent in the EU before allowing businesses to target ads, aligning with evolving regulatory requirements in the region.

A spokesperson from Meta stated that the company believes in “free services which are supported by personalized ads” but is exploring “options to ensure we comply with evolving regulatory requirements.”

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