Tech giant Meta Platforms (META) is getting ready to roll out ad-free subscriptions for Facebook and Instagram in the UK “over the coming weeks.” This comes as the Big Tech companies’ advertising practices have drawn the scrutiny of European watchdogs.
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The company announced on Friday that it will float the subscription option for £2.99 per month for the web versions. On iOS and Android devices, on the other hand, the ad-free plan will cost £3.99 per month.
The plan means that personal data of such subscribers will not be processed for ad targeting, the company noted. However, users can still choose to continue to use both platforms for free in exchange for ads, which they can control via settings.
The new options came after Meta’s “extensive engagement” on policy guidelines with the UK Information Commissioner’s Office, the British data watchdog. It also follows the end of a three-year legal battle between Meta and a British woman who dragged the tech giant to court over ads shown to her on Facebook. In March this year, Meta agreed to stop the ads.
Ad Sales Power Meta’s Growth
Meanwhile, income from Meta’s online advertising business via its social media platforms accounts for almost all of the company’s revenue. Last year, the business brought in about 98% of its $164.5 billion revenue. Meta is now even looking to Google’s (GOOGL) Gemini AI platform to further boost growth in this segment.
Meanwhile, the latest update aligns with Meta’s similar service in the European Union, where subscriptions for ad-free versions of both platforms start at €5.99. However, the development also points to the larger crackdown by EU regulators on the advertising and marketing activities of major U.S. tech giants in the bloc.
Is META a Buy, Hold, or Sell?
Turning to Wall Street, Meta’s shares currently enjoy a Strong Buy consensus recommendation, as seen on TipRanks. This is based on 40 Buys and six Holds assigned by 46 Wall Street analysts over the last three months.
Furthermore, the average META price target of $873.88 indicates a 17% growth potential from the current level.
