Social media firms are worried about an expected decline in users after the UK passes its Online Safety Bill. A source familiar with advertising at Instagram told the Financial Times that with an increase in user checks, fewer users will be on social media platforms and therefore there'll be fewer people to advertise to. The legislation is not yet in force but it’s getting closer with it going through the final stages of the House of Commons starting this week.
The FT also spoke to people involved with policies at social media companies and they said the new bill would see the removal of underage users from platforms. They say the bill would also discourage individuals with identification or with privacy concerns from using platforms. All of this would hit ad revenue.
With credit being more expensive to acquire following a rise in interest rates, businesses are cutting back on ad spend which is hitting social media companies too. With these extra protections set to come into law, it’ll be a further hit to the incomes of these companies.
Last week, Neowin reported that scores of Conservative backbench rebels called for jail sentences to be added to the bill if bosses at social media firms don’t comply with the law, rather than just being hit with fines. Reports suggest the government was nearing a deal with the MPs over the issue.
Once the bill clears the House of Commons it will go through several readings in the House of Lords and then be sent for Royal Assent where it will be brought into law. While advocates of the bill want all this done speedily, it’s not clear how long it will actually take.
Source: Financial Times
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