#SocialStocks: EU gatekeeper law will not face opposition from Big Tech

Welcome to “#SocialStocks,” The Fly’s weekly recap of Wall Street’s reactions to social media stock news.

REEL UPGRADES: In an earlier blog posting, Meta Platforms’ (META) Instagram disclosed new tools to take content creation to the “next level…” The company is “announcing a number of improvements to Reels, exciting new updates for feed photos & carousels, Stories, and new insights to help you better understand your performance. Key updates include: Saving time editing your videos with new tools like Undo / Redo that make it easier to edit individual clips and Make new memes by adding clips with audio to your Reels from our new Media Clip hub. Also the company said it will add “new and inspiring ways to create Reels on Instagram. Also announced was “10 new English text-to-speech voices to select from, available in select countries, a streamlined view of all your saved drafts for easier editing “in your in-progress Reels.” Also mentioned in the post were the latest filters “from subtle color edits to options for expressive styles, these updates make it easy for you to try various looks for your posts.”

EU GATEKEEPER LAW: Microsoft (MSFT) and Google (GOOG😉 have decided not to contest a recent EU regulation, Foo Chee and Supantha Mukherjee of Reuters reported This new law mandates these companies, along with others like Alphabet, Amazon (AMZN), Apple (AAPL), Meta and ByteDance’s TikTok, to facilitate easier transitions for consumers between competing services. The European Union had previously identified 22 “gatekeeper” services in September, obliging them to enable interoperability among their messaging applications with rival services. Additionally, these companies are required to allow users to select which applications come pre-installed on their devices under the Digital Markets Act.

LOOSENING CONSTRAINTS ON POLITICAL ADS: According to Salvador Rodriguez from The Wall Street Journal, Meta has decided to make adjustments to its advertising policies for the upcoming 2024 campaign. One notable change involves permitting ads on Facebook and Instagram that claim the 2020 presidential election was rigged. Meta made this alteration last year, allowing political advertisers to use terms like “rigged” or “stolen” in reference to past elections. However, the company still prohibits advertisers from questioning the legitimacy of ongoing or upcoming elections.

NO BACKING DOWN: Major social media companies in the United States faced a setback as a federal judge declined their attempts to dismiss nationwide litigation, wrote Jonathan Stempel and Nate Raymond for Reuters. The lawsuit accuses these companies of unlawfully luring and addicting millions of children to their platforms, resulting in harm to their mental health. The ruling came from U.S. District Judge Yvonne Gonzalez Rogers in Oakland, California, and it affected Alphabet, Meta, owner of TikTok ByteDance and Snap (SNAP).

CLOSE FRIENDS: Meta is broadening Instagram’s Close Friends feature, enabling users to exclusively share main feed posts and reels with their Close Friends, of TechCrunch’s Amanda Silberling reported. Users on Instagram can now navigate to an “audience” menu before sharing a post or reel and choose their Close Friends list. As a result, the content shared with Close Friends will be distinguished by a green star icon in their feeds.

AMAZON EXTENDS REACH: Amazon has finalized an agreement with Snap that enables users to directly purchase Amazon products from advertisements within the Snapchat app, The Information’s Sylvia Varnham O’Regan and Theo Wayt noted.. An Amazon spokesperson has verified the agreement. This deal bears similarity to a recent ad partnership between Amazon and Meta that was announced last week. Similarly, it allows users to make purchases through Amazon ads on Instagram and Facebook without having to exit those respective apps. This move is expected to make Meta more attractive to advertisers and allow Amazon to attract shoppers outside of its store. U.S. shoppers will be able to see pricing, delivery estimates, and product details in the ads run on Facebook and Instagram, an Amazon spokesperson told Bloomberg.

CHEAPER HEADSETS IN CHINA: Raffaele Huang, Liza Lin, and Salvador Rodriguez from The Wall Street Journal reported that Meta has initiated a preliminary agreement to introduce a new, more affordable edition of its virtual-reality headset in China. According to sources familiar with the matter, the deal with Tencent Holdings (TCEHY) will grant Tencent exclusive rights to sell Meta’s headsets in China. The sale of these headsets by Tencent is anticipated to commence towards the end of 2024.

LENS POWERED BY OPENAI: Snap is set to launch a fresh iteration of its AR development tool, named Lens Studio 5.0 Beta, directed at developers, TechCrunch’s Aisha Malik wrote. This updated AR development tool aims to facilitate more advanced AR creation, boasting heightened efficiency and incorporating new AI features, including one powered by OpenAI. Snap revealed this announcement during its Lens Fest AR developer conference, marking its sixth annual event. The company has collaborated with OpenAI to introduce a novel ChatGPT Remote API, enabling developers to utilize ChatGPT within their Lenses. Lens Studio 5.0 Beta also introduces another AI function, a 3D face mask generator, allowing users to swiftly craft their initial viral self-expression Lens in mere seconds, as stated by the company.