Meta’s (META) shares dropped fractionally on Monday morning after the U.S. tech giant agreed to offer users in the European Economic Area versions of Facebook and Instagram that come with less personalized advertising.
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The European Commission, the EU’s executive arm, announced the development on Monday, noting that the move will help the American company comply with the EU’s regulation for online platforms, the EU Digital Markets Act (DMA). The choice is to be offered starting in January next year.
“Meta will give users the effective choice between consenting to share all their data and seeing fully personalised advertising, and opting to share less personal data for an experience with more limited personalised advertising,” the Commission said.
EU Slams $233B Fine on Meta over Policy
In June, the European watchdog threatened to impose daily fines on Meta after the social media company came forward with limited changes to its pay-or-consent model. In November 2023, Meta started asking users to either consent to tracking for personalised ads on Facebook and Instagram or pay for an ad‑free version of the service.
Following criticism, Meta late last year cut the price of its no‑ads subscription. The tech giant also introduced a new option for EU users to access Facebook and Instagram for free with less personalized advertising.
It noted that these and other changes go beyond what is demanded by EU laws. However, the European Commission hit a fine of €200 million ($233 billion) on Meta in April, noting that the still policy contravened the DMA.
Now, Meta is bowing to pressure and will give more choices to users. However, it remains unclear if that means users will not have to pay for the ad-free versions. In late September, Meta disclosed plans to roll out ad-free versions of Facebook and Instagram to UK users.
Is META Stock a Good Buy Now?
On Wall Street, Meta’s shares continue to enjoy a Strong Buy consensus rating. This is based on 36 Buys, six Holds, and one Sell issued by 43 analysts over the past three months.
Moreover, at $832.06, the average META price target suggests over 24% upside from the current trading levels.
