Meta is setting up a product organization to identify and build “possible paid features” for Facebook, Instagram, and WhatsApp, according to an internal memo sent to employees last week that was obtained by The Verge.

The new division is Meta’s first serious foray into building paid features across its main social apps, all three of which boast billions of users. It’s being set up after Meta’s ads business was severely hurt by Apple’s ad tracking changes on iOS and a broader pullback in digital ad spending. The group, called New Monetization Experiences, will be led by Pratiti Raychoudhury, who was previously Meta’s head of research.

In an interview with The Verge, Meta’s VP of monetization overseeing the group, John Hegeman, said the company is still committed to growing its ads business, and that it had no plans to let people pay to turn off ads in its apps. “I think we do see opportunities to build new types of products, features, and experiences that people would be willing to pay for and be excited to pay for,” he said. He declined to elaborate on paid features that are being considered.

“I think we do see opportunities to build new types of products, features, and experiences that people would be willing to pay for.”

Meta’s revenue almost entirely comes from ads, and while it has several paid features already across its apps, the social media giant hasn’t made charging users a priority until now. Hegeman downplayed paid features becoming a meaningful part of the business in the near term, but said that “on the flip side, I think if there are opportunities to both create new value and meaningful revenue lines and also provide some diversification, that’s obviously going to be something that will be appealing.”

Longer term, Meta sees paid features becoming a more meaningful part of its business, he said. “On a five-year time horizon I do think it can really move the needle and make a pretty significant difference.”

Facebook group administrators can already charge for access to exclusive content, and virtual “stars” can be purchased to send to creators. WhatsApp charges certain businesses for the ability to message their customers, and Instagram recently announced that creators could also begin charging a subscription for access to exclusive content. In June, CEO Mark Zuckerberg said the company wouldn’t take a cut of transactions from paid features and subscriptions until 2024.

“On a five-year time horizon I do think it can really move the needle and make a pretty significant difference.”

Meta isn’t alone in pushing toward more paid features. Social media apps have been increasingly turning to charging over the past couple of years. TikTok started testing paid subscriptions for creators earlier this year, Twitter has paid Super Follows, and Discord makes its money entirely from its Nitro subscription. In addition, this year both Telegram and Snapchat added paid tiers that unlock additional features. Snapchat’s paid tier has proven to be an early hit.

“We’re obviously paying attention to what’s going on in the industry,” said Hegeman. “And I think there are multiple companies that have done interesting things in this space that I think hopefully we can learn from and emulate over time.”

Source: The Verge

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