Threads, Meta’s hugely popular Twitter rival, attracted over 100 million users in its first week but the social media platform is currently not available to EU customers.
The hold up of the Threads’ EU launch is reportedly due to the EU’s Digital Markets Act (DMA) which sees Meta as a ‘gatekeeper’ company. This means the company will risk large fines for violation of data-sharing laws.
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The DMA, which came into force in November 2022, is a set of rules that aims to regulate the market to allow for fair competition in Europe and globally.
Infringement of the DMA could cost companies with the gatekeeper status up to 10% of annual global turnover for violating the rules or 20% for repeated infringements.
Threads has arguably seen such early success because it connects individual’s accounts with their Instagram so that contacts can be transferred.
However, the ease at which Meta has allowed data sharing has put the company is hot water.
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By GlobalDataExperts say the delay of Thread’s European launch could potentially hurt Meta’s profitability.
Threads has arguably seen such early success because it connects individual’s accounts with their Instagram so that contacts can be transferred.
Alexander Frolov, CEO and co-founder of marketing platform HypeAuditor, told Verdict that the platform’s rapid growth “lies precisely in the ease and ability for users to transfer their audience from Instagram to Threads,”
Frolov warned that if the DMA prevents EU customers from transferring their contacts in this way, Thread’s growth in the EU will be significantly affected, impacting the monetisation of the platform.
Marvin Winkelmann, managing director at marketing agency AFK, told Verdict that the delay of the launch in the EU will inevitably harm the app’s profitability as it fails to capitalise on the hype generated with the global launch.
“Consequently, the expansion in the EU experiences a significant slowdown, leading to a reduced number of new users joining the platform,” Winkelmann said.
He added that the app’s inability to share data in the EU as it has in the US and the UK will decrease the value of data collected from the platform’s launch.
“With fewer available users, the outcome is a decrease in generated ad revenue,” Winkelmann said.
