Under Elon Musk’s direction, the coveted blue tick on the platform is now only available to Twitter Blue customers who pay $8 monthly for upscale services. Even Musk’s latest model does not appear to be doing well. NBC’s senior reporter Bill Collins did the math and posted it on Twitter.
Curious how many people actually signed up for Twitter Blue yesterday and today? Well, I've got the numbers and I'll be telling them to @JoyAnnReid on MSNBC in ten minutes.
Here's a hint: They were net +28 between signups and cancellations. Not 2,800. Twenty-eight.
— Ben Collins (@oneunderscore__) April 21, 2023
Popular social figures and celebrities who opted not to subscribe are already starting to lose their blue ticks on the platform, with many declaring they would stop posting there because it is now so easy to spoof them.
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Twitter had previously released Twitter Blue in 2021, but its $3 monthly fee and constrained functionality prevented it from having a significant financial impact on the website’s mostly advertising-supported business model.
Musk hardly added any new features to Twitter Blue besides the option to purchase verified blue checkmarks from eager users. But after openly haggling with author Stephen King, Musk decided on a far higher $8 monthly pricing rate for Twitter’s premium account.
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It appears that Twitter users do not recognize the benefits of Musk’s expensive new membership model. Only 290,000 users had signed up as of mid-January, two months after the service’s inception, according to recent data from The Information.
The estimated $27.8 million in additional subscription income represents less than 3% of the annual interest he is required to pay. According to Quartz’s rough calculations, Musk needs to sell 10.4 million subscriptions in order to make that $1 billion a year. He is therefore missing 10.1 million subscriptions.
Musk reduced costs at Twitter by firing most of the company’s employees (or motivating them to leave). Out of the 7,500 workers, there were before Musk took control, only 1,300 remain, per CNBC. However, he has also driven away advertisers in the process who were alarmed by loose content monitoring guidelines.
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At a time when advertisers were already cutting back on their expenditures, there was a revenue loss. And Musk has thus far been unable to compensate for the lost advertising revenue with membership income.
Musk will need to persuade around 10 million more people or about 4% of Twitter’s 238 million monthly users—to adopt his plan before Twitter becomes sustainably profitable and the cost of purchasing the company is recovered.
