What might this look like?
The New York Times reported that Meta is considering an ad-free paid subscription option in the European Union. We have no details regarding how seriously this is being considered or even what a subscription might look like, but we can speculate.
According to Meta’s 2Q earnings for 2023, the Average Revenue Per User (ARPU) for Facebook users in Europe was $17.88. That sets a minimum value for a Facebook user at $6 per month. This number is only for Facebook and I haven’t seen a similar number for Instagram.
Of course, those who sign up for a paid subscription are also some of the most valuable people in the targeting pool. Removing them would have a big impact on advertisers.
This certainly isn’t my expertise, but I’d have to assume somewhere between $10 and $20 per month would be reasonable. This could replace lost revenue from advertising and then some.
Would people pay for this to remove the perceived annoyance of ads? Or maybe Meta would fold in other benefits to make it more valuable (like Meta Verified).
This is all speculation, of course. We have no idea how imminent this is.
What do you think?
