New division at Meta to work on paid features for Facebook, Instagram

#Apple #Facebook #Instagram

Meta makes most of its money through the ad business
Apple's ad tracking policy has affected dozens of tech companies' ability to monetize ads
Several social media companies like Twitter, Discord and Snapchat have added paid features

Written By:Rwit

Updated: August 31 2022 03:46:01 PM ET Menlo Park, CA, USA

Meta is setting up a brand new division to identify and build “paid features” for some of its social media apps like Instagram, Facebook and WhatsApp, according to a report from The Verge.

The New Monetization Experiences division is the tech conglomerate’s first real, albeit serious foray into building paid features into its apps. Facebook, Instagram and WhatsApp all together command billions of users but that hasn’t stopped the company bleeding money because of Apple’s new ad tracking policy for the iOS. Additionally, as countries, companies and consumers climb out of the pandemic, digital ad spending has taken a significant hit.

Pratiti Raychoudhury, previously the company’s head of research, has been named the head of the division, The Verge reported.

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“I think we do see opportunities to build new types of products, features, and experiences that people would be willing to pay for and be excited to pay for,” Meta’s VP of monetization John Hegeman told The Verge. He also said that the company had no plans to turn off ads in its apps anytime soon and that it was committed to growing its ad business.

For a while now, Meta’s primary source of revenue has been its ad business, but the company has not banked on its paid features to make money. Now however, Hegeman said the company was planning to make it a more important part of their business and that in five-years time paid features will “move the needle and make a pretty significant difference.”

The company already has a limited set of paid features up and running. Content creators on Facebook and Instagram can charge a subscription for access to their exclusive content. Earlier this year in June, Meta CEO Mark Zuckerberg had announced that the company would not be taking a share of the profits from such creators until 2024.

More and more tech companies in the social space have begun to charge users for premium features. Snapchat and Telegram both have premium tiers that unlocks additional features for users. TikTok rolled out paid subscription test for content creators earlier this year.