Meta has agreed to obtain "consent" from users in Europe in order to display targeted ads to them, according to The Wall Street Journal. If this is true, it would represent a seismic shift in Meta's operations and raises questions as to how they would implement a consent mechanism on Facebook and Instagram to meet the standards required by the EU GDPR.
If a large portion of European users refuse to "opt in" to personalised ad campaigns, what impact would this have on Meta's attractiveness to advertisers and their ability to run effective targeted ad campaigns? Without anything like the same volume of data being processed to segment users and to create audiences for ad targeting purposes, the impact on Meta's revenue and ad serving capabilities could be significant. With Meta having to provide the same standard of service to users who "opt out", the question is what incentive would any user have to opt in when prompted?
According to The Wall Street Journal, Meta have told regulators it will take at least 3 months to implement the switch to a consent model - it will be interesting to see how this plays out and in what timeframe.
Meta has reported a rebound in its ad revenue this year, aided by its use of artificial intelligence to improve ad targeting. That has helped the company recover from a $10 billion drop in ad revenue from Apple privacy changes for iPhones. Those changes, made in 2021, hindered Meta's ability to use data it had about its users' activity on third-party apps. It isn't clear how those AI fixes will perform without data on usage of Meta's own apps