For decades we could use the Internet free of charge – at least in large parts. But now the tide is turning. Even advertising giants like Meta rely on premium services.
For years, the Internet had a single price: that of access. Once you dialed in, everything was pretty much free. One can argue that otherwise it would not have become as ubiquitous as it is today. But the free online world is slowly but surely coming to an end. The Internet is becoming a payment model.
The most recent examples are, of all things, the services that have been taken for granted as part of the common good since their existence: social networks such as Facebook, Tiktok or Twitter have always been free of charge since their rise. Now that is increasingly changing. After Meta, for example, with its services Facebook, Instagram and Whatsapp, became one of the most important advertising providers in the world, the group is now discovering the premium model for itself.
New sources of income
“We see the opportunity to build new products, features, and experiences that people are willing to pay for, maybe even willing to pay for,” said Facebook’s vice president of monetization, John Hegeman, in a recent conversation with The Verge. He didn’t want to name any examples, but they don’t want to do without advertising. “We see this as an opportunity to create both serious revenue streams and business diversification.”
The Group’s previous efforts show where the path could lead. On Facebook, for example, group operators can only grant access to some content to paying users, and on Instagram accounts with a large number of followers can also ask their followers to pay by subscription. And with Whatsapp, the group is trying to establish itself as an alternative to the supermarket.
Everything on premium
Meta is not alone in the effort. Other social networks such as Tiktok, Snapchat or Twitter are also experimenting more and more with how to move from pure advertising revenue to more direct payments by customers. Tiktok, for example, has been testing paid subscriptions for certain accounts since the beginning of the year. At Twitter yesterday the long-awaited function for editing tweets was unveiled as a paid feature. For a while now, users have been able to become subscribers as “super followers” and thus have exclusive access to content.
The model for paid premium content is less streaming subscriptions like Netflix, but the service Onlyfans, which is known primarily for sex content. The start-up, which is only a few years old, first showed that fans of social media personalities or nude models are willing to pay money to get access to exclusive content. The success speaks for itself: network users spent 4.8 billion euros last year, and both users and spending increased significantly this year. The profit is growing even faster: Onlyfans made a profit of 432 million euros in the 12 months before September 2021. A six-fold increase compared to the previous year.
privacy as an issue
For Meta and the other advertising companies, this is like a punch in the stomach. For them, an important part of the income has been lost in recent months. Because Apple made it more difficult to monitor user behavior on its devices last summer, it became particularly difficult to target iPhone users, who are particularly valuable to advertisers, with advertising tailored to them.
According to its own statements, the group lost ten billion euros as a result last year. As a result, Meta had to report a decline in advertising revenue for the first time in its history: In the second quarter of this year, revenue fell by one percent compared to the previous year, and now stands at 28.8 billion euros. However, the profit collapsed much more: With an increase of 6.7 billion euros, Meta was a whopping 36 percent below the previous year.
The premium offers offer a welcome source of income – mainly because they allow you to continue to generate advertising revenue. While YouTube, for example, wants to make its subscription called “Premium” attractive with a number of other advantages, including freedom from advertising, Meta, Tiktok and Co. are clearly aiming for additional income.
The worst of both worlds
This, in turn, makes the situation particularly annoying for customers. The true cost of free internet was that the corporations had accumulated mountains of user data for years and used it for targeted advertising (read more about the true extent of data collection here). But instead of being able to pay for data protection and a better user experience, customers can now pay extra for attractive content – while they continue to be snooped on.
Sources: The Verge, Meta, Twitter,