Home Platforms The Monetization Motivation Behind Facebook’s Messaging Merger

The Monetization Motivation Behind Facebook’s Messaging Merger

SHARE:

Facebook’s plan to integrate the backend infrastructure of its messaging platforms isn’t sitting well with privacy advocates, security experts, European regulators or US lawmakers.

Alarm bells are ringing all over the place.

The Irish Data Protection Authority says it’s going to be “very closely scrutinizing” the situation, particularly where it might involve the sharing and merging of personal data between different Facebook companies; Sen. Edward Markey (D-Mass.) issued a statement of great skepticism (“We cannot allow platform integration to become privacy disintegration”); and Rep. Ro Khanna (D-Calif.) tweeted that Facebook’s integration plan is exactly why “there should have been far more scrutiny during Facebook’s acquisitions of Instagram and WhatsApp.”

So, why would Facebook do it? Facebook says it’s to make its messaging services “fast, simple, reliable and private.”

But merging the messaging capabilities within WhatsApp, Messenger and Instagram could also make that combined ecosystem more attractive to advertisers – if Facebook can avoid running afoul of the General Data Protection Regulation (GDPR) and dodge a righteously angry Congress.

Monetizing the message

Messaging is now one of Facebook’s three main focuses, in addition to Stories and video, as it transitions its monetization strategy away from a reliance on the news feed.

If Facebook can figure out how to effectively monetize messaging apps via advertising, “a consolidated backend speeds development, which is a competitive differentiator in the break-things-fast tech world,” said Brigitte Majewski, a VP and research director at Forrester.

But, just like the messaging integration process itself, it’s still very early days for monetizing messaging.

Although rewriting the underlying code to merge the backends of Messenger, Instagram and WhatsApp could theoretically consolidate ad inventory across the platforms, “there isn’t much ad inventory to consolidate at the moment,” Majewski said.

Businesses can’t advertise within Instagram direct messages, WhatsApp advertising is still in beta and brands are “barely advertising in Messenger,” she said.

Subscribe

AdExchanger Daily

Get our editors’ roundup delivered to your inbox every weekday.

“Brands haven’t yet shown they know how to market to users in a messaging app environment without being terribly invasive, and messaging app users certainly aren’t clamoring for it,” Majewski said.

If Facebook knows anything, though, it’s how to make it easy for advertisers to spend money on its platform. The ad buying process is consolidated across its properties. When an advertiser logs into Facebook Ads Manager, they can tick a box to expand their ad placements across the Facebook feed, the Instagram feed, Facebook Stories, Instagram Stories, in-stream video, Messenger, the Facebook Audience Network … and so on.

“I expect as WhatsApp rolls out advertising, that placements there will also be part of Ads Manager,” said Debra Aho Williamson, a principal analyst at eMarketer. “This new initiative to knit together the backend of Facebook messaging platforms is coming on top of what is already going on in the backend of the ad buying infrastructure.”

(Anti)trust us

Beyond the bottom line, weaving Facebook’s messaging services more tightly together could also make it more difficult to break up Facebook if there’s an antitrust action.

The purpose of antitrust law, in the United States at least, is to protect the interests of consumers by encouraging competition.

But by unifying the code bases for its messaging products, Facebook could argue that it’s making the messaging experience better by enabling people to more easily connect across networks, while also improving security by bringing WhatsApp-level encryption to all users.

“Wouldn’t it be ironic if Facebook found itself subject to regulation for antitrust and not for consumer privacy explicitly?” Majewski said. “Merged or separate, has Facebook meaningfully demonstrated its ability to enable consumer privacy? No.”

Must Read

play button with many coins isolated on blue background. The concept of monetization of the video. Making money on video content. minimal style. 3d rendering

Exclusive: Connatix And JW Player Merge To Create A One-Stop Shop For Video Monetization

On Wednesday, video monetization platforms Connatix and JW Player announced plans to merge into a new entity called JWP Connatix. The deal was first rumored in July.

HUMAN Raises $50 Million

HUMAN plans to build a deterministic ID from its tracking of more than 20 trillion digital signals per week across 3 billion devices, which will aid attribution for ecommerce.

Buyers Can Now Target High-Attention Inventory In The Trade Desk

By applying Adelaide’s Attention Unit scoring, buyers can target low-, medium- and high-attention inventory via TTD’s self-serve platform.

Privacy! Commerce! Connected TV! Read all about it. Subscribe to AdExchanger Newsletters

How Should Advertisers Navigate A TikTok Ban Or Google Breakup? Just Ask Brian Wieser

The online advertising industry is staring down the barrel of not one but two potential shutdowns that could radically change where brands put their ad dollars in 2025, according to Madison and Wall’s Brian Weiser and Olivia Morley.

Intent IQ Has Patents For Ad Tech’s Most Basic Functions – And It’s Not Afraid To Use Them

An unusual dilemma has programmatic vendors and ad tech platforms worried about a flurry of potential patent infringement suits.

TikTok Video For Open Web Publishers? Outbrain Built It.

Outbrain is trying to shed its chumbox rep by bringing social media-style vertical video to mobile publishers on the open web.