Billionaire founder and CEO, Elon Musk has announced that X, formerly known as Twitter, is considering implementing a paywall for all users. During a live stream on X alongside Israel’s Prime Minister Benjamin Netanyahu, Musk explained that this move is primarily aimed at countering the widespread use of bots on the platform.
“The single most important reason that we are moving to have a small monthly payment for the use of the X system, is it is the only way I could think of to combat vast armies of bots.”Elon Musk
He believes that by introducing a payment system and giving priority to premium users’ posts, the platform can reduce the influence of these automated accounts.
Musk further elaborated on the rationale behind this decision, noting that “because a bot costs a fraction of a penny, call it a tenth of a penny, but even if it has to pay a few dollars or something, some minor amount, the effective cost of bots is very high,” Musk said.
In Musk’s view, the paywall is an essential measure for X to effectively address the issue of bot activity. The billionaire entrepreneur also mentioned plans to offer a lower-tier pricing option, ensuring that the paywall remains accessible to a broader range of users. He emphasized, “We want it to be just a small amount of money. It’s a longer discussion, but this is actually the only defence against armies of bots.”
This move isn’t entirely new for Musk, as he had previously discussed the idea of a paywall for all X users with venture capitalist David Sacks in the past, according to a report from the tech newsletter Platformer.
Does Elon Musk’s paywall defy X’s initial purpose?
Since acquiring the platform in October 2022, Elon Musk has implemented several significant changes, including the rebranding of Twitter to X. He also replaced the platform’s legacy verified program (blue ticks) with the Twitter Blue subscription program in March.
These changes are part of Musk’s strategy to steer the platform towards profitability. In July, Musk acknowledged the financial challenges faced by the company, stating, “We’re still negative cash flow, due to a ~50% drop in advertising revenue plus a heavy debt load. Need to reach positive cash flow before we have the luxury of anything else.”
Since then, Musk has gone on to introduce and expand its creator monetisation program to include a portion of the ad revenue that it earns from ads appearing in the replies to creators’ posts. The company confirmed that this action is part of its effort to help people further monetize their time on the app.
Eligible creators are subscribers of Twitter Blue or verified organizations, those with more than 5 million tweet impressions per month for the last 3 months, and creators who pass human review for Creator Monetization Standards.
Although a strategic move to combat bots, the latest introduction of a paywall for all users makes the platform more restrictive and profit-driven, going back on its initial purpose to serve as a free de facto town hall for all and sundry.
However, the strategy will help Musk realise a major goal of generating revenue directly from its user base. This automatically helps the company reduce its dependence on advertising revenue, which can be volatile.
One thing is certain, the introduction of a paywall would affect the competitive landscape of social media platforms. Users who do not feel the need to pay extra to use a platform may choose to migrate to its competitors which are gradually emerging.
Overall, the introduction of a paywall for all users represents a strategic decision by Twitter to address issues such as bots and generate revenue but also carries potential risks related to accessibility and the platform’s identity.
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