this post was submitted on 04 Oct 2023
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[–] kibiz0r@midwest.social 39 points 1 year ago (6 children)

in 2022, advertising revenue amounted to close to 113 billion U.S. dollars whereas payments and other fees revenues amounted to around two billion U.S. dollars.

With roughly three billion monthly active users as of the second quarter of 2023, Facebook is the most used online social network worldwide.

113/3 = about $38 per user per year

14*12 = $168 per user per year

Which would be a mark-up (a Zuck-up?) of 342%.

You do have to figure though, that it’s only the most active users who will opt to pay $14/month, and it’s those same highly-active users that contribute the most to the ad revenue.

Having no idea how those stats actually break down, we could take a wild guess and do a Pareto Principle 80/20.

Say the top 20% active users constitute 80% of the ad revenue, and those same top 20% all switch to the paid model:

(113*0.8)/(3*0.2) = about $151 per VIP user per year

…which is a lot closer to the $168. Zuck-up of about 11%.

80/20 is probably cutting them too much slack, but the real markup is probably closer to 11% than it is to 342%.

This is also not factoring the extra operational expense of supporting the new model.

Math part over, here’s my take:

This is good.

Ad-based models are toxic. We poisoned our culture, bulldozed our privacy, distorted the economy, gave unfathomable power to immature narcissistic opportunists, and underdeveloped public FOSS tech because we expected privately-owned services to be Free™ even though they could never be literally free.

This is a move towards unmasking these services and revealing the real economic gears whizzing around behind them.

The more people understand what their privacy and autonomy is worth to these companies, the more they might insist on keeping it — and maybe even seek out places where they don’t have to pay for the privilege.

Sources:

https://www.statista.com/statistics/268604/annual-revenue-of-facebook

https://www.statista.com/statistics/264810/number-of-monthly-active-facebook-users-worldwide/

[–] beefcat@beehaw.org 17 points 1 year ago* (last edited 1 year ago)

This is good.

I agree, in principal. I think the internet as a whole would be healthier if more sites weren't so averse to offering paid ad-free/premium upgrades early on. Now people are used to getting everything for free, heavily subsidized by invasive advertising and until recently a bottomless pit of venture capital. It's resulting in very nasty changes to these platforms as many try to find some pathway to sustainability that can be executed in 3-6 months.

When you get something free with advertising, you are the product. That is why enshittification takes hold so aggressively, because making you happy is not the primary means by which they bring in money to pay the bills.

However, at this point I have 0 faith in Facebook to actually do anything good, and I'm sure they will find some way to fuck this up entirely.

[–] Catsrules@lemmy.ml 7 points 1 year ago

The math doesn't need to make sense because the only reason they are doing this is to get around EU regulations. They are just providing a ad free experience option to make the EU happy.

[–] jsdz@lemmy.ml 4 points 1 year ago* (last edited 1 year ago)

You do have to figure though, that it’s only the most active users who will opt to pay $14/month

I'd say it's more likely to be the most wealthy users who will pay the $14, and it seems plausible that the most devoted facebook users might care less about avoiding the ads than people who are there only reluctantly. So maybe slightly closer to the middle of that 11% to 342% range.

[–] dark_stang@beehaw.org 2 points 1 year ago

Thanks for breaking that down, I was trying to find the per user amount

[–] macallik@kbin.social 2 points 1 year ago (1 children)
[–] bug@lemmy.one 2 points 1 year ago (1 children)

Come on man, let that shit die with Reddit!

[–] macallik@kbin.social 1 points 1 year ago* (last edited 1 year ago) (1 children)

Good insight. We must protect @bug at all costs.

[–] bug@lemmy.one 1 points 1 year ago

I need all the protection I can get now Big Subreddit are after me!

[–] ericjmorey@beehaw.org 31 points 1 year ago (2 children)

And they won't collect information about the subscribers, right?

[–] lobelia581@lemmy.dbzer0.com 26 points 1 year ago* (last edited 1 year ago)
[–] jarfil@beehaw.org 4 points 1 year ago* (last edited 1 year ago)

The information is worth way more than $14/month, last estimates I've seen put it around $50/month.

[–] java@beehaw.org 20 points 1 year ago* (last edited 1 year ago) (1 children)

That's a classic create a problem, sell the solution situation.

[–] marco@beehaw.org 5 points 1 year ago (1 children)

On useful ad-supported service I have happily paid a little to get rid of ads.... on Facebook I'd have a very hard time saying it's worth that much to me to have my data sold :p

[–] dan@upvote.au 2 points 1 year ago (1 children)

Facebook (and Google) don't sell user data. That's a common misconception. The data is what makes the company valuable... They're not going to go and sell it! Instead, they let advertisers target users based on the data (eg run an ad for people aged 24-30 that like computers). Advertisers never see the actual data, nor can they tell exactly who viewed their ad.

[–] marco@beehaw.org 3 points 1 year ago (1 children)

Did they just give all the data to Cambridge Analytica for free?

I include their advertising targeting in my data being sold, even if they retain the data in house, they are monetizing it heavily.

[–] dan@upvote.au 1 points 1 year ago

Did they just give all the data to Cambridge Analytica for free?

The Facebook Graph API is free, yes. Cambridge Analytica happened because the API was too open and allowed loading some profile data for not just you but your friends too. The idea was that social apps like Spotify could show your FB friends (and in fact Spotify was one of the early major users of the API), but of course some people figured out how to use it for evil.

The API is now very locked down as a result, and requires a lot of certification and approval to use anything even remotely sensitive. Developers don't like that since you can't easily write scripts/bots for FB any more like you can on Discord for example, but there's not really any other option. Other apps like Discord will likely hit similar issues if they grow anywhere near the size of Facebook.

I include their advertising targeting in my data being sold, even if they retain the data in house,

Saying that data is sold implies that another entity is buying the data, which isn't true. You could say that your data is being monetized, sure, but not sold.

[–] UrLogicFails@beehaw.org 19 points 1 year ago (2 children)

A couple of key highlights:

The proposal is a gambit by Meta to navigate European Union rules that threaten to restrict its ability to show users personalized ads without first seeking user consent—jeopardizing its main source of revenue.

It would give users the choice between continuing to access Instagram and Facebook free with personalized ads, or paying for versions of the services without any ads, people familiar with the proposal said.

Under the plan, Meta has told regulators it would charge users roughly €10 a month, equivalent to about $10.50, on desktop on a Facebook or Instagram account, and roughly €6 for each additional linked account, the people said. On mobile devices the price would jump to roughly €13 a month because Meta would factor in commissions charged by Apple’s and Google’s app stores on in-app payments.

Privacy-conscious users in the U.S. shouldn’t expect to be offered the option to pay for ad-free Instagram or Facebook soon. Meta’s proposals have been pitched specifically as a way to navigate demands by EU regulators to seek consent before crunching user data to select highly personalized ads.

It isn’t clear if regulators in Ireland or Brussels will deem the new plan compliant with EU laws, or whether they will insist Meta offer cheaper or even free versions with ads that aren’t personalized based on a user’s digital activity.

This feels like Meta is just attempting to play at Malicious Compliance. There's no way they make that much off each user per month, this feels like they are intentionally making it cost-prohibitive to have the ad-free version just so they can say they are meeting EU regulations. I certainly cannot see many users shelling out ~€17 a month for Instagram and Facebook.

As noted, though, this may not be enough to pass the EU regulations.

[–] macallik@kbin.social 3 points 1 year ago

I agree re: malicious compliance. Also leading w/ the web price knowing that the majority of their base uses mobile devices to connect

[–] dan@upvote.au 1 points 1 year ago

this feels like they are intentionally making it cost-prohibitive

Like I mentioned in another comment - To me it seems like it's priced relative to the market. YouTube's premium membership is $15, but you can do a lot more on Facebook compared to YouTube (not just videos but also wall posts, messaging, photos, groups, events, dating, birthday reminders, etc) and their costs would be similar to Google in terms of data centers, servers, employees, etc.

[–] peter@feddit.uk 11 points 1 year ago (1 children)

$14 a month is an incredibly large amount, maybe if it also allowed you to disable reels and go to a chronological feed it would be nice for some but still. Says a lot about the value per customer I guess.

[–] dan@upvote.au 1 points 1 year ago* (last edited 1 year ago) (1 children)

The article says it's $10.50/month? Seems like it's priced relative to the market. YouTube's premium membership is $15, but you can do a lot more on Facebook compared to YouTube (not just videos but also wall posts, messaging, photos, groups, events, dating, birthday reminders, etc) and their costs would be similar to Google in terms of data centers, servers, employees, etc.

You'd be surprised how much it costs to run a major web service that has a lot of content. Google search would cost at least that (if not more) per month if it was a paid service.

[–] peter@feddit.uk 1 points 1 year ago

Why does the title say $14 then?

[–] petrescatraian@libranet.de 8 points 1 year ago

@alyaza guess I'm staying on Fedi, lol. I get all this for the price I donate to my server (or other servers like beehaw). Besides, there's less distractive stuff and the interface is less addicting.

[–] spaduf@slrpnk.net 7 points 1 year ago

This is probably the migration event that Pixelfed has been waiting for. Anybody know how this news is being received on Instagram?

[–] taanegl@beehaw.org 6 points 1 year ago

14 bucks.. to make content for them and them also have to watch ads... why?

[–] Plume@beehaw.org 3 points 1 year ago

I'm not willing to pay 13 bucks a months for ad-feee YouTube. In what world does Meta expect me to pay more then that for having an ad-free experience on their dogshit platforms?

[–] YuzuDrink@beehaw.org 3 points 1 year ago

Gosh, if they’d offered this 10 years ago, I’d have been MUCH more interested. As-is, I haven’t really used Facebook in a year or two because of the awful timeline, not the ads. So cool idea, but too little (well, too much cost, I guess) and too late for me to care.

[–] waratchess@lemm.ee 3 points 1 year ago

Ad free, but ist it also tracking free?

[–] HisNoodlyServant@beehaw.org 1 points 1 year ago

When I used Facebook I wouldn't of actually minded this if they also added some customization for your feed. However $14 is a big ask. Maybe for ALL their services including the Oculus.

[–] Sir_Kevin@lemmy.dbzer0.com 1 points 1 year ago* (last edited 1 year ago)

Who is still using facebook?