Twitter subscription model is Musk’s big gamble
The new owner of the social media platform has proposed a $8 fee for verified accounts and is even considering a paywall to completely alter the company’s business model
Elon Musk want Twitter users to pay to be able to complain Twitter. In recent days, one of the US tycoon’s most-repeated tweets has been a variant of “$8,” when someone has voiced criticism of the social media platform he bought for $44 billion in October. That amount is the cost that Musk has established as a fee for a verified account, or a blue subscription, on Twitter. However, it is not just $8, but an attempt at a profound change to the Twitter we have known until now, and even more so after it became known that the company is debating whether to place the entire platform behind a paywall. At the moment, such a move is still speculation.
Details about Twitter’s subscription model have been emerging rapidly. In the early days after Musk’s buyout payment was tied only to verified users, a legacy of Twitter’s origins, where parody accounts were commonplace before celebrities started to join themselves. Hence the oft-used prefix of “real,” for example Donald Trump’s @realDonaldTrump. Other social networks also have verified users, but what was at first necessity soon became a status symbol: being verified was equal to being important.
$8— Elon Musk (@elonmusk) November 5, 2022
There are 400,000 verified accounts on Twitter. The idea that Musk’s only goal was to make verified users pay for their status token led to the first wave of criticism. But last weekend Musk himself spoke at the Baron Investment Conference in New York and clarified what he had previously hinted at in tweets: the $8 payment serves to authenticate you as a human being, not just as a celebrity. The goal of the new blue tick is not status, it is humanity.
“If you are payment verified you’ll be prioritized,” Musk said. “The point of this is to make crime not pay, because right now to create a bot on Twitter costs less than a penny.” Musk also alluded to Google while explaining the strategy behind paid blue tick verification, pointing out that when a search is typed into the engine the most relevant results are on the first page and by the time a user reaches page eight or nine, there is little but irrelevant results and scams.
November 8, 2022
What are the implications of the new system? The main issue with Musk’s policy is how many subscribers Twitter will have. According to internal company documents obtained by The Verge, since Musk’s takeover active users have risen by 15 million, to 255 million, as Musk himself later tweeted. Profits would be substantial even if less than half of all users decided to pay, but if only 10% or so of users do so it will not be. The forerunner of the new Twitter subscription model is Twitter Blue, which launched this year in the US and has 100,000 subscribers.
Although Musk’s underlying idea is that if you want to continue using an improved version of Twitter you will have to pay for it, the blue tick subscription has other advantages, (although some will be carried over from Twitter Blue), such as seeing a summary of the most shared tweets among your followers, being able to edit tweets and post videos of up to 42 minutes. Subsequently, the option to share revenues with content creators will be offered, in the same YouTube does, for example.
FWIW, I was always a fan of an idea we called "Commercial Accounts" internally—which was to charge businesses for Twitter use. Features would include verification, stats, and profile customization. Someone smart put this deck together in Q209 but...priorities. pic.twitter.com/6wkWdckcs0— Ev (@ev) November 1, 2022
Musk’s big Twitter gamble
The idea of subscriptions is neither sudden nor new. It is even likely that Twitter will offer several subscription options depending on the type of account. In 2009, according to one of the co-founders, Ev Williams, Twitter prepared a presentation on how businesses could pay. Over the years, seeing that advertisers were not providing enough money and that the cultural importance of the network for news and information was growing, payment became a real option. It is also the only text-centric network today; its unparalleled place at the center of global ideas makes it unique. But is that enough to pay?
Another issue that Musk spoke about during the interview is “spam, bots and trolls.” The first two, who spread unwanted content, won’t want to pay $8 a month to flood the web with rubbish, Musk noted. But is could be a boon for trolls, whose modus operandi on Twitter is to appear first in replies to celebrity tweets. With payment verification, they will face less competition.
How does Birdwatch avoid bias, pile-ons, ...?— Birdwatch (@birdwatch) October 31, 2022
Video transcript: https://t.co/FgJnBFsuV7 pic.twitter.com/hRyawhsHtt
Musk complained publicly about the lack of support he receives from corporate advertisers. At the moment, advertising accounts for 89% of Twitter’s revenue but Musk believes that its influence is excessive and disproportionate. One argument in favor of the subscription model is that advertisers would carry less weight, as is the case in the media among publications that have taken similar steps.
Musk will try other changes to Twitter, but the subscription model is perhaps his biggest gamble, one that can either sink or revitalize the network. The lack of an immediate alternative, a preference for a text-based platform and the impact it has had on a generation that use it as their primary source of information, as well to argue and celebrate, and importantly who have little desire to try other platforms, could prove to the keys to its success.