Paid social: Meta could be trying a new business model in Europe

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Paid social

Meta is considering introducing paid versions of Facebook and Instagram for European users, giving them access to endless ad-free scrolling. The move is largely in response to the bloc’s increasingly stringent policies on data collection, which has limited the company's ability to deliver targeted advertisements in the region — you know, the slightly creepy ones that crop up on your feed with the exact thing you were browsing for the other day.

A paid subscription tier would be a huge departure from Meta’s hyper-efficient core business — a $110bn+ advertising monolith that's leaps ahead of its rivals in extracting value from users. Despite being a free service, Facebook alone rakes in nearly $18 every single month for each one of its US & Canadian users — substantially more than the $10-15 a month you might pay for services like Netflix, Spotify or Amazon Prime.

Adios and adieu, ads

If it is somewhat forced to experiment with a new business model, Europe is arguably the safest place for Meta to try one. At just over 400 million monthly active users, the region is substantially smaller than Facebook’s Asia-Pacific and Rest of the World user bases, of 1.35 billion and 1 billion, respectively. Furthermore, European users are far less lucrative than their American counterparts, contributing on average less than a third of what a typical American user adds to Facebook's revenue.

Convincing those European users to part ways with ~$6 a month to look at memes, vacation pictures and news headlines might be a tough ask though, even for the masters of monetization at Meta.

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