I think it's clear given Meta's share price on a whiff of decreaing DAUs that Meta needs the EU more than the EU needs Meta's attention sinks.
I can mostly agree, but there will be large and interesting practical effects. For example, everyone I know in Prague uses Messenger on a daily basis. I think this is true in many places. I also wonder about where small businesses, who have come to rely on FB for one thing or another, will migrate.
If this story applies to Messenger, this would lead to the biggest DAU migration in history![1] Kind of interesting.
[1] In the areas affected.
I think there is a good chance Meta is not bluffing. It could be viewed as a way to slow or quarantine the spread of data regulations. Pull out of Europe and let Europe develop its own competitor that will have control over Europe, but won't be able to compete abroad. Satiating European want for data regulation and privacy laws in Europe would, hopefully in Meta's view, dampen the broader push for these regulations (a push being led by Europe). Essentially let Europe isolate themselves. This will probably be followed by Meta and other corporations pushing propaganda and marketing highlighting any mistake or failure of European replacements.
Pulling out of Europe would hurt, but at the end of the day Europe's population is small and already developed. In 10 years are there going to be a lot more Europeans spending a lot more, requiring more advertising? Doubtful.
But this could also backfire if other countries look at new European competitors with jealousy and want to emulate it.
Addendum: why does meta.com redirect to [1]?
Of course there's some "hull" called "Alphabet" who legally owns Google, but what more than a hull is it? Don't know whether it's for tax reasons, spreading the risk, trying to decouple the image in case of failed products, everybody knows that Alphabet == Google. Same goes for Facebook and Meta: There might be a Meta hull but that hull is quite packed with Facebook, so it does not really matter what the hull is called (or does).
I don't understand Facebook's name change. It is still Facebook. It wants to stay as a cohesive unit and share data across products. It isn't like Facebook will ever voluntarily give up whatsapp or instagram.
I can't quite explain it but I am willing to disassociate the stock ticker Alphabet (NASDAQ:GOOG) from Google but not Facebook (NASDAQ:FB)
These arrangements also make it easier to close things down if needed: it simplifies redundancy (“why can't you offer me a replacement role over there?”, “that is a separate company”) and so forth, though this is more a concern of smaller organisations than Meta & Alphabet. A company I've worked for once had a significant rearrangement with people signing contracts for specific parts where they had previously been employed by the larger group entity, shortly before “divesting” some of those parts. Shady, but legal.