Mark Zuckerburg’s Meta Platforms is looking to capitalize on the angst against Elon Musk-owned Twitter and is launching its Twitter-like app Threads this week. The company isn’t however launching the app in the EU as it battles the region’s data protection regulators.
While Threads is available on iOS App Store in the US for preorder, it is yet not visible in app stores in the EU.
Meta Platforms has a chequered history with regulators in the EU and earlier this year, the European Commission fined the company $1.3 billion and asked it to stop shipping users’ data to the US.
It was the biggest fine that the Commission ever imposed and over 50% higher than the $806 million fine on Amazon in 2021.
Separately, Meta has lost a case in the EU court where it accused Germany’s cartel watchdog of overstepping its powers in 2019.
European Union regulators are quite vocal about data protection issues and Sweden’s privacy regulator has imposed a fine of over $1.1 million on two companies while calling upon corporations to stop using the Google Analytics tool.
US Big Tech companies especially Amazon, Meta Platform, and Alphabet have been at odds with European regulators over multiple issues.
Another flashpoint between tech companies like Google and European regulators could be about AI regulations.
— Block Savvy (@Block_Savvy) June 30, 2023
The EU is working on comprehensive AI regulations which it is expected to unveil later this year.
While the rally in listed AI and related stocks helped the Nasdaq clock its best first half in four decades – regulators globally are scrambling to come up with regulations.
Meta Looks to Capitalize on User Angst Against Twitter
Many Twitter users have been irked by how Musk has managed Twitter since he acquired the company.
Multiple reports suggest a rise in hate speech on Twitter. Musk however countered the argument and in a BBC interview earlier this year he said that hate speech hasn’t increased on the platform since his acquisition.
His restoration of several banned accounts – including that of former US President Donald Trump had also not gone well with a section of users.
The latest diktat on the number of tweets users can read was also a flashpoint between Musk and many Twitter users.
Meanwhile, Twitter’s advertisement revenues have cratered since Musk’s acquisition and according to a New York Times report, the company’s revenues fell 59% YoY in April.
Twitter Ad Revenues Have Fallen Since Musk’s Acquisition
By Musk’s own admission, Twitter is on track to hit $3 billion in revenues this year – which is 41% lower than the $5.1 billion revenues that it hit in 2021, the last full year before he took it private.
Twitter’s new CEO Linda Yaccirino is working towards bringing back advertisers on the platform and called upon the company’s sales team to get ready for “hand-to-hand combat” – which means meeting big brands in person to persuade them to advertise on Twitter.
To put that in perspective, Meta Platforms’ revenues fell around 2% last year but the company reported a 3% rise in Q1 2023 revenues.
Twitter’s popularity among advertisers pales in front of Meta. According to the report that’s titled “Digital 2023 April Global Statshot,” 21.5% of working professionals aged between 16 to 64 said that their company uses Facebook for social media marketing.
The platform’s advertising reach has meanwhile fallen over the last six months and according to Datareportal, its reach was 373 million in April, down from 556 million in January.
Meanwhile, several alternate platforms are looking to lure Twitter users. The most prominent among them is Bluesky which is backed by Twitter’s co-founder Jack Dorsey – who believes that Musk is not the right steward for Twitter.
Meta is also looking at using the reach of its existing platforms and is launching Threads.
Threads Might Not Launch in the EU For Now
Meanwhile, it seems, for now, Meta won’t launch Threads in the EU as the Mark Zuckerberg-led company sorts data protection issues with the regulators.
A Meta spokesperson said that the company is looking to launch Threads in 100 countries and would subsequently expand it to more countries.
The company hasn’t however specified the list of countries where Threads would be initially launched.
According to a report in Ireland’s Independent newspaper, Meta won’t launch Threads in the EU and Ireland “for the foreseeable future.”
The report added that while Ireland’s Data Protection Commission (DPC) hasn’t actively blocked Threads but Meta is not yet prepared to roll out the service in the EU in compliance with the region’s privacy laws and GDPR.
All said, Meta Platforms could emerge as a tough competitor to Twitter as Facebook had nearly 3 billion monthly active users in the first quarter of 2023.
Meta is anyways battling slowing growth and a Twitter-like platform would help it increase its growth as users get increasingly disenchanted with Twitter amid the haphazard changes that Musk is pursuing.
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