Can Elon Musk-owned Twitter thrive with a subscription-only model?

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Now that Elon Musk has invested $44 billion to buy Twitter and plans to take the social networking platform private, there are rumors of a possible subscription model.

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The question is, is anyone willing to pay to use the platform?

Many experts believe that following can be one of the best alternatives to Twitter.

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“We think the subscription service will be key to Twitter’s potential turnaround,” said Wedbush Securities analyst. Dan Ives said Tuesday. “We see this as one of the first changes to the platform’s business model.”

But can Musk, the self-proclaimed “absolutist of freedom of speech”, whose imminent takeover of Twitter came almost three months after it began buying shares in the company with a growing share, persuading users to buy a subscription, all in the name of freedom of speech?

“That’s a big question,” Ives said. “It will still be risky for Musk to bet 20% of his fortune on Twitter.”

Technical Analyst John Meyerformer Twitter shareholder, spoke on Tuesday with various Twitter contacts and people associated with Musk. He believes a new subscription model is just around the corner if the deal is closed before October 24th.filing with the US Securities and Exchange Commission.

“Musk will soon introduce a new type of monthly subscription offer that includes a new form of ‘verified badge’ on user profiles,” Meyer said. “I expect this to become Twitter’s dominant form of income as they embrace a years-long shift away from the advertising business as their main source of income.”

We’ll likely see a hybrid subscription-advertising model come into play. Justin BuchbinderGlobal Head of Social Media at FINN Partners.

“Ads currently account for over 86% of Twitter’s revenue and it’s a steep mountain to climb down. It will most likely end up the same as Spotify, whose current user base includes 45% of paying Premium subscribers, with another segment accepting ads. instead, not to pay,” Buchbinder said. “Will there be the same distribution for the 206 million daily active Twitter users? You can’t say for sure.”

Buchbinder thinks the subscription-to-ad ratio will be smaller, but he said it all comes down to whether Musk’s Twitter becomes something that people find valuable and are willing to pay.

“What will be the price? What do they offer with a subscription? Will a competitor launch a similar platform that will be free and more like the Twitter that its users prefer?” Buchbinder said. “Only time will tell us that.”

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Could Twitter, which co-founder and former CEO Jack Dorsey said was “the closest thing to global consciousness”? tweet on Monday, to be a site where people will pay for freedom of speech despite a continuous stream of racist, sexist and bigoted posts?

As these questions persist, Musk tweeted on Tuesday that “by ‘freedom of speech’, I simply mean what is in accordance with the law. I am against censorship, which goes far beyond the law. If people want less freedom of speech, they will turn to the government to pass the appropriate laws. going beyond the law is contrary to the will of the people.”

The current Twitter subscription service is down

Twitter currently has Blue, a $2.99-per-month premium subscription service that debuted in November. The service provides more customization features, including a way to “undo tweets” and a mode that makes those long streams of tweets easier to read.

But Musk appears to be thinking of something bigger, a way to help offset Twitter’s reliance on ads as its main source of income.

One reason Twitter Blue hasn’t gained much popularity since launch is the cost-benefit ratio, Forrester research director. Mike Pru said.

“Users simply don’t get value for a $2.99 ​​monthly subscription,” Prue said. “So whether Elon Musk can launch a Twitter subscription service or not will depend on offering significantly more value to justify the premium price.”

Proulx said the lack of ads “won’t tip the balance” as Twitter ads are far less intrusive compared to other ad formats on other platforms.

“Things like exclusivity, status and access are starting to move the needle, but as long as the core of ‘free’ Twitter remains intact, it will be difficult to sell,” Prue said.

SUPPLY ALMOST COMPLETE:Elon Musk to acquire Twitter for $44 billion

Aron Solomonhead of strategy at digital marketing firm Esquire Digital, and an avid Twitter user since 2009, said that while Twitter could support a more robust subscription offering, it would require a more thorough experience with features such as improved timelines and an edit button.

“I don’t think that in the current state of Twitter, there’s a lot of incentive for people like me, or people who don’t look like me, to pay an annual fee to use it,” Solomon said.

Jessica J. Gonzalezattorney and co-CEO of Free Press and co-founder of the Change Conditions coalition, believes Twitter subscription fees could outweigh some “critical voices” including the poor and certain minority groups.

Gonzalez said she would not pay more than $10 for a subscription and would not be on Twitter for fun.

“Never. I’m on Twitter to organize justice. I love Twitter, but Twitter doesn’t love me back,” Gonzalez said. “As a woman of color, I get harassed in waves, usually when I speak out against racism. A lot of it is petty, racist, sexist, mean and rude. And I don’t think it will get any better under Musk.” who has something to do with content moderation.

“How do we use the communication tool for liberation and justice and make sure it’s not being used to harm?”

Above all, the deal must be completed, said Prue, Forrester’s chief executive.

“This is just speculation and speculation about what will actually happen to Twitter when the deal closes later this year,” Prue said. “But given the amount of money Musk is paying to acquire the company, it would be unwise to do anything that would lead to a mass exodus of users. This is exactly what moving to a pure subscription model can do.”

Follow Terry Collins and Brett Molina on Twitter: @terryscollins, @brettmolina

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