Instagram Cuts Dependence on User Data, Without Cutting Its $26 Billion Ad Revenue

Meta Platforms may have finally discovered the golden ticket to generating billions of dollars without ever having to worry about digital privacy, user data, or advertisements

Instagram Cuts Dependence on User Data, Without Cutting Its $26 Billion Ad Revenue
Photo by Jacob Owens on Unsplash

After examining the ongoing legal challenges, Meta, Facebook's new face, has been striving for months to design a marketing strategy that does not rely on users' personal data. After leaping from one trial to another, Facebook may have actually discovered the golden ticket to generating billions of dollars without ever having to worry about digital privacy, user data, or advertisements. Instagram, a Meta subsidiary, is experimenting with something new that will give users something they've never previously experienced: a chance to generate a consistent income from the platform. To put it another way, influencers will be earning money directly from the platform, rather than relying on external resources. This experiment with the new feature may generate billions of dollars in revenue without using ads or processing. Instead, it relies on paid memberships. In a strange twist, while Apple’s App Tracking Transparency (ATT) is great to businesses, it could also be beneficial to Facebook. It's a terrific way to make a profit because it's a win-win situation. As a result, it is likely to place its $26 billion in ad revenue, which already represents more than half of all Meta ad revenue, ahead of advertising as it adjusts its business strategy away from advertisers and toward its users.

The new feature and the revenue stream are the product of Facebook's failed attempt to target audiences without tracking them after losing its privacy battle and losing millions of dollars in the process. For a platform that has operated as a marketing tool to influencers for decades, the non-revolutionary income model could be effective. In reality, OnlyFans, a subscription-based social media platform, was designed to provide Instagram influencers with a method to earn steady monthly revenue online without having to rely on paid sponsors or affiliate marketing partnerships. In other words, with its roughly 1.4 billion users, Instagram has a much greater opportunity of earning billions by introducing the subscription function. That's subject to without jeopardising one's reputation or establishing a completely new brand identity. After its latest update, Instagram is all it wants, but with one major caveat, that it'll almost certainly come at the expense of additional in-feed adverts. To combat this, it offers users the option of totally avoiding advertisements by paying to access content from specific creators, similar to YouTube's income model. It's a significant step forward for the ad-supported dial-up platform to align its objectives with those of its users. As a result, while the platform isn't perfect, it's improving. For the first time, it's moving away from hedging its advertising against its users, instead of paving the way for a symbiotic commercial partnership based on a win-win strategy, as every company should.