Meta Discovers Privacy Has a Revenue Line

Meta told investors Wednesday that European advertising revenue grew 18 percent year over year in the three months through September, Wired reports. Growth slowed from earlier quarters and trailed the 33 percent increase in the US and Canada. The disclosure followed Meta’s introduction of a less-personalized advertising option for European Facebook and Instagram users at the beginning of the year. Revenue rose. The rate of increase fell.

The option keeps advertising but reduces the personal data used to select it. Meta says the model uses 90 percent less data than personalized ads. Ads instead draw on what someone views during a particular session, plus information including age, location, and gender. Less personalization does not mean no targeting. It changes the information available to the targeting system.

EU regulators required an equivalent service that uses less personal data under the Digital Markets Act. The European Commission found that Meta’s earlier arrangement, which offered an ad-free subscription to people unwilling to accept personalized advertising, did not satisfy that obligation. Regulators imposed a €200 million fine. The dispute concerned the terms of access, not simply whether Meta displayed a choice somewhere.

The earnings figures do not isolate the new option’s effect. Meta did not explicitly blame the model in Wednesday’s briefing. In July, however, chief financial officer Susan Li said the fully rolled-out offering could be an additional “headwind.” An analyst cited by Wired also linked the option to the slowdown. Those assessments support examining the connection; they do not establish how much slower growth the option caused.

Meta has warned that less-personalized ads produce poorer advertiser returns, fewer transactions, and more dismissals of irrelevant or repetitive ads. These are Meta’s claims, not independent findings established by the earnings comparison. Advertiser prices in Europe also grew more slowly than in the US and Canada. That regional difference does not, by itself, prove that reduced personalization explains the gap.

The privacy preference has reached the accounting department. That is useful evidence of a commercial conflict, not evidence that users made a mistake. Meta does not disclose how many people selected each option. Without those figures, observers cannot infer a European rush toward privacy, widespread indifference, or the revenue effect per person who switched.

Meaningful choice therefore needs scrutiny beyond the quarterly growth rate. Meta controls the wording, prominence, and steps through which users encounter its options. It can explain how users revisit a selection and disclose adoption figures alongside its revenue claims. Those decisions would make the bargain easier to inspect. A slower-growing advertising business is not a substitute for that explanation.