You might probably be asking why I am doing a story about twitter in a channel dedicated to the media business. Let me explain. The Media Industry is very intertwined in multiple ways. Let me go point by point. These days the stature of a celebrity is measured by the following they have on twitter. The celebrity's brand endorsement fee depends on the number of followers they have on twitter. And mind you this obsession with twitter is only in the media industry. Number of users in twitter has long been stagnant.
Twitter has been popular with Baby boomers but generations like Gen X, Millennials, Gen Z and Alpha have moved on to more modern, mobile centric social media platforms such as - Instagram, snapchat, tick tock and many such platforms….
Some of our actresses have been trendsetters by being Instagram first, but most actors, print & tv media reporters, production houses,. have been stuck in time and continue to be twitter centric. The new generations have adopted social media and messaging platforms that are more image or video centric and have become content developers by themselves setting the trends for the market. Probably that's the reason our traditional production houses are not able to bring themselves to adapt to the platforms of new generations.
Twitter users are disappearing and also disappearing are its revenues. Twitter has lost more than Two Billion Dollars.
In this context the most richest man in the world Elon Musk made an offer to buy twitter which appeared to be a very whimsical offer as he did not appear serious later and tried to backtrack.
But twitter caught this opportunity and went to court and the judge started pulling out many details of Elon Musk-Twitter conversations which proved to be very uncomfortable for Musk. Pushed to the wall, he had no choice but to buy twitter. Though he is the richest man he too had to raise huge loans to make this forty four billion dollar acquisition.
Now he has these massive loans, and added to this he has to pay for the losses that twitter is accumulating. So he now has to make money and that too quickly.
So to achieve this, he seems to have laid aside the very principle to protect which he originally announced on the acquisition of twitter - “Free Speech”.
He said he has freed the bird but now that he is in the monetary cage he has announced that he will form a committee that will determine what content will be allowed and what will not be allowed on twitter. This was a step to pacify advertisers as was obvious from the fact that he made this announcement in a letter to the largest advertisers. We have to understand this in the context that the largest advertisers in the west use their power to push political interests. However the markets have been in recession for the last two years due to pandemic and recession is expected to become only worse. That means no big advertising revenue growth in the immediate future.
He has also announced that the blue tick that is given to celebs or Public Personalities will now be available for everyone thus making everyone equal. Anyone can get it as long as you can pay eight dollars per month. So ‘equality for all’ who can afford to pay. This seems to be a desperate measure to generate revenue. But assuming that all the four lakh users who have blue tick will start paying, twitter will still make only thirty eight million per annum. Which is very small considering that twitter has to pay one billion dollars only for its - interest payments. Please remember this is not the total EMI, it is only interest.
So this requires more desperate steps. When you have a look at the biggest growth engines in social media you will see tik-tok and instagram which are all video centric. So video based content will obviously be a priority for Elon Musk. That will be directly intertwined with the media industry.
According to documents accessed by Washington Post, twitter is rushing a feature to allow posting of long videos. Twitter handles posting the videos can charge viewers a fee and ofcourse twitter will take a share of this fee. These videos unlike other social media will allow nudity and consensual pornography. Per view price according to leaked mockups are $1, $5 and $10. These steps definitely look like very risky and very desperate attempts by a person who rushed into buying a company at a price twice that of estimated market value.
The twitter financial quickmire has already landed him into trouble as he tried to fire majority employees while not abiding by the contracts of giving benefits and twitter stock. After a big backlash and a class action lawsuit, twitter called back some of the fired employees saying that they were fired by mistake. All this is making a big negative impact on the global brand image of Elon Musk.
I am, like many others, have been a fan of Elon Musk and what he has achieved in the field of Rockets and electric vehicles is phenomenal and the world is indebted to him. But I feel he has fallen into this massive twitter debt that will unfortunately draw his financial resources, his focus and attention to things that are not a priority for his great mind. But once his great mind is applied to this social media - content industry will it transform the media industry as we know.
We only can wait and see. Let me know what you think about the way forward of twitter and the new trend that this might set.
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