How much millionaires would pay for a premium Facebook

The North American market remains the revenue juggernaut for Facebook, with just under $5.7 billion booked in the first quarter and almost double European revenue, which is the second-largest source of revenue globally. North America also is the outlier by ad revenue per user. of $5.45 in Q1 2018, versus $23.14 per user in the United States and Canada.

“Facebook makes about $50 billion a year in advertising revenue; $100 million would be a rounding error,” said Daniel Ives, chief strategy officer at GBH Insight, which covers the stock.

Ives said that there is a “less than 15 percent chance” that Facebook would consider the premium model in the United States.

On Thursday, Facebook released a transparency update for users to gain greater understanding of why they see certain ads and who is paying for ads.

At Zuckerberg’s testimony on Capitol Hill in April 2018, the Facebook founder and CEO said, “There will always be a version of Facebook that is free.” He added, “In general, we believe the ad model is the right one for us.”

Ives said a premium model might prove more popular in Europe, where privacy regulation is more strict and privacy concerns are greater. Ives thinks the damage from the Cambridge Analytics data scandal has been contained in the United States — Facebook shares reached a new all-time high after the scandal headlines waned — but Facebook might consider this model overseas due to regulatory pressures, possibly by late 2019, Ives said.

In Europe, Facebook’s revenue per user in Q1 2018 was $8.01.

Source link

Share with your friends!

Products You May Like

Leave a Reply

Your email address will not be published. Required fields are marked *

Get the latest Business news
straight to your inbox

Subscribe to our mailing list and get interesting stuff and updates to your email inbox.