(Image source from: Businesstoday.in)
"Why is WhatsApp prompting me to switch to a Plus subscription? " I happened to hear a coworker mention this while I began working on this article. I turned to her for clarification. She explained that when she opened WhatsApp Web on her computer, a small notification appeared on the screen suggesting she buy a WhatsApp Plus subscription - an optional premium plan integrated within the official WhatsApp app, which provides improved features for a small monthly charge. Meta, the company led by Mark Zuckerberg that owns WhatsApp, Instagram, and Facebook, has just rolled out subscription plans worldwide for its main apps. They are also experimenting with new subscriptions for businesses, creators, and users of Meta AI, including an AI chatbot. Standard subscriptions for Instagram Plus and Facebook Plus cost Rs 99 each month, and WhatsApp Plus is also priced at Rs 99 per month (currently offered at a 50% discount in India for six months). Meta is additionally testing upgraded levels for frequent users.
Meta One Plus is about Rs 775 a month, and Meta One Premium is Rs 1,939 a month for advanced AI reasoning and generation capabilities. Meta has 3.5 billion users each day. Analysts think this is a pressing effort to cover rising AI expenses as Mark Zuckerberg seeks to catch up in the AI market where it is falling behind. Meta's acquisition of Scale AI founder Alexandr Wang for $14.3 billion to head its Superintelligence Lab has drawn significant scrutiny about whether this investment will pay off due to the soaring AI costs. Meta has raised its capital expenditure prediction for 2026 to an unprecedented amount between $125 billion and $145 billion, mainly to support AI computing infrastructure, data centers, and increasing component expenses.
Meta's aspirations in AI reach far beyond the United States. In India, Meta has teamed up with Reliance Industries to set up an AI data center in Jamnagar, Gujarat. The latest partnership, announced last week, extends their multibillion-dollar collaboration from the previous year to develop AI solutions for businesses in India and other markets.
Faisal Kawoosa, Chief Analyst and Founder of Techarc, stated to NDTV, "Meta intends to invest over $125 billion in AI infrastructure, and it requires a consistent and proportional earnings stream to justify this spending. Relying solely on ad revenue won’t suffice, especially as content discovery and consumption have changed with the rise of AI. The issue with Meta, in my view, is that it hasn't built the level of trust in enterprises like Microsoft or Google, which is why its influence in the business world is nearly absent. Regular users might find such pricing discouraging, particularly from a service that has been free. Moreover, there needs to be a strong reason to pay." Despite the significant investment in AI, internal problems are reportedly troubling Meta, including cultural issues, claims of data bottlenecks needing staff reassignments, and developer dissatisfaction over high salaries for new hires like Wang. Various reports also indicate growing dissatisfaction inside the company after Meta laid off 10% of its workforce due to AI realignment.
According to Truist Securities, it is estimated that subscriptions could generate $20 billion in high-profit revenue each year by 2030. Deutsche Bank mentions that subscriptions might add up to $15.6 billion in extra income next year, based on a WSJ report. However, many experts on Wall Street doubt these optimistic predictions. Company statistics show that last year, 97.6% of Meta's earnings came from ads, which is concerning as it indicates a lack of development in expanding beyond its main business since it started two decades ago. In comparison, Google, which also began with advertising, had more revenue from non-ad sources ten years ago than Meta did last year. This likely explains why Zuckerberg is suddenly acting with more urgency than before.
Currently, users do not seem very excited about the premium features, which feel like a pay-to-play gamble at this stage. While it is still early, features such as customizing profiles, tracking story views, viewing stories secretly, and pinning more chats are probably not going to attract much attention beyond dedicated users and influencers. AI expert and CTO, AiEnsured Srinivas Padmanabhuni describes Meta's new way of making money as a temporary fix. He stated, "Meta's paid plans seem like an extra offer for power users and a short-term solution to manage AI costs while it aims for better returns".
