According to Twitter CEO Elon Musk, starting next month (May), Twitter will “allow media publishers to charge users on a per-article basis with one click.” Musk believes that this feature will benefit both media and users as media can charge a higher per-article price instead of a full monthly subscription for occasional readers.
However, Musk did not specify what percentage of the fee Twitter would take or what rules and conditions the media should follow. Given Musk’s track record with timelines, it is wise to consider his “next month” estimate as an optimistic best-case scenario for the launch of Twitter’s pay-as-you-go microtransaction service.
Nevertheless, the urgency for Musk to make more revenue is real. Twitter and Musk are in a race to make more revenue. Twitter Blue is the first attempt by Elon Musk to make money from Twitter. Twitter Blue is an optional subscription service that provides a blue checkmark on your account and grants early access to specific features such as Edit Tweet for a fee of $8 per month or $84 per year.
Not long ago, Musk urged creators worldwide to monetize their content with Twitter subscriptions (super followers), promising that Twitter would not take any percentage for the first 12 months. In addition, the company has introduced a new fee structure for API access, which previously was free and could now cost some businesses up to $42,000 per month.
Checkout my other article: Now You Can Add Up to Five Links to Your Instagram Profile. Goodbye to Linktree?
So, why is Musk so desperate to make money from Twitter?
Twitter’s financial outlook appeared grim to investors as the platform’s user growth stagnated, leading to a loss of $344 million in its last quarterly earnings report before Musk’s acquisition. The acquisition by Musk has further increased the company’s debt by billions of dollars, exacerbating the existing problem. To fund the deal, Musk borrowed $13 billion, using the company as collateral, resulting in an annual interest payment of approximately $1 billion, which is more than Twitter’s total profits for 2021, as pointed out by DealBook.
Since Musk’s proposal in April, there are indications that Twitter’s ad business, its primary source of revenue, has become more uncertain. Ad spending has decreased throughout the summer, and even established companies such as Facebook and Google are feeling the effects of the drying digital markets. Following Musk’s takeover, several major ad agencies have suggested that clients completely suspend Twitter advertising, either due to the sudden chaos, the broader economy, or a combination of both.
