In response to EU regulatory pressure, Meta has announced plans to provide less personalized ads on Instagram and Facebook for users in Europe. This ad model, either at no cost or a reduced subscription price, represents a significant shift in Meta’s advertising approach and is expected to impact the company’s revenue in one of its primary markets.
New Ad Format for European Users
In the coming days, Instagram and Facebook users across Europe will receive notifications prompting them to switch to this new ad format. Unlike the current personalized ads, which are based on a user’s broader activity history, these ads will only reflect content viewed during the current session. While this reduces the level of personalization, some targeting elements will remain, including age, gender, and location, with ads now expanding to fill the entire screen. This less personalized ad option is part of Meta’s compliance with increasing EU demands for user privacy and data transparency, adds NIXSOLUTIONS.
Revenue Concerns Amid EU Regulations
The shift to less personalized ads comes amid growing regulatory pressures from the EU. Meta has historically resisted offering users a free way to opt out of ad targeting, citing potential revenue declines. Given that Europe accounts for roughly 23% of Meta’s revenue, the impact of this change could be substantial. In addition, Meta has been vocal about its frustrations with EU tech regulations, including requirements for user consent to use data for training artificial intelligence. For instance, Meta had to delay the launch of its chatbots in the EU until proper user consent processes were in place. In an open letter, Meta highlighted that strict regulations could stifle AI development in the region and argued that personalized advertising remains beneficial for both users and advertisers.
Expanded EU Advertising Options
The Wall Street Journal notes that Meta’s shift to “less personalized ads” marks its second major adaptation to its EU advertising model within a year. Previously, the company introduced an ad-free subscription option, allowing users to opt out of ads by paying €13 per month. The new ad-free subscription, with a reduced price of €8 on mobile devices and €5 for additional accounts, aims to provide users with choices that balance regulatory compliance and service accessibility.
We’ll keep you updated as Meta continues to navigate EU regulations and refine its advertising options in Europe to meet user expectations and regulatory requirements.