Facebook Researching Ad-Free Subscription Model; Zuckerberg Not Paying Publishers

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MENLO PARK, Calif. – Bloomberg reports that Facebook has been conducting market research to determine whether an ad-free version, paid by subscriptions, would spur more people to join the social network.

Citing “people familiar with the matter,” Bloomberg reports that Facebook has studied this option before, but now there’s more “internal momentum” to pursue it in light of the data privacy scandal, those people said. 

The plans aren’t solid and may not go forward, and Facebook hasn’t publicly commented on the possibility of a subscription-based ad-free service.

On the other end of possible pay-to-play news from the social media giant, Recode is reporting that CEO Mark Zuckerberg will not replicate the cable TV model and pay publishers a yearly fee in exchange for their content.

“I’m not sure that makes sense,” Zuckerberg said when asked about the proposal, floated by Rupert Murdoch and others during the past year. He was speaking at Off the Record, an annual gathering of journalists and media executives hosted by The Information, Quartz, and BuzzFeed. 

He also repeatedly emphasized his interest in helping news organizations sell subscriptions to their content. “People come to Facebook primarily not to consume news but to communicate with people,” he said. “The way we can help out the most with that is by helping out with a business model that is profitable and sustainable for news organizations.”

He added that the “advertising model is what most people have focused on” for internet publications. “That can be good, but it’s not the whole story,” he added. 

Zuckerberg said he was “frustrated” that Facebook’s efforts to promote subscriptions via his properties haven’t moved as quickly as he’d like. The company has “moved too slowly on getting the subscription product to perform really well,” he said.

But he said Facebook itself would continue to focus on providing a free, ad-supported service. “In our case, I think it’s okay,” he said. “It’s a very efficient model.”

Initially, Facebook wanted publishers using Facebook’s paywall tool to provide a minimum number of articles for free each month. Now, Zuckerberg says he has “basically concluded that the right decision is to let everyone set the meter where they want it to be.”

Facebook generated practically all of its $41 billion in revenue last year from ads targeted with user data.