Monday, June 27, 2022

Elon Musk thinks he can only double Twitter’s revenue through subscriptions

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Elon Musk – the world’s richest man and the new owner of Twitter – expects Twitter to earn nearly $10 billion in subscription revenue by 2028, a forecast that doubles the total $5 billion revenue the platform made last year, according to a report from The New York Times

In a pitch deck viewed by the Time, Musk gave investors a taste of what to expect under his ownership. This reportedly includes pushing Twitter Blue subscribers up to 69 million by 2025 and more than doubling that number to 159 million by 2028. Twitter Blue, which launched last year, is the $2.99-per-month subscription. the service that gives users access to an “Undo Tweet” button, app customization, ad-free articles, and other exclusive features. Musk also expects massive growth in the total number of Twitter users, from the 217 million users reported last year to 600 million Twitter users by 2025 and finally 931 million by 2028.

The pitch deck also outlines plans for an undisclosed subscription service outside of Blue, called “X,” which Musk expects to gain nine million subscribers by 2023 and 104 million by 2028. Earlier this week, Musk hinted that governments and companies will have a “low cost.” Whatever subscription “X” is, revenues from the service and Blue combined should reach $10 billion by 2028, which is a big part of Musk’s $26.4 billion in total revenue. thinks the service will reach that same year.

According to the TimeTwitter should make up for the rest of its total projected revenue from advertising, something Musk predicts Twitter will earn about $12 billion by 2028. Twitter relied on ads as the main revenue stream in the past, but Musk, who said in a now-deleted tweet that Twitter should remove ads for paid subscriberswants ads to make up only 45 percent of Twitter’s total revenue.

Musk’s pitch deck reportedly includes plans to also bring in $15 million from some sort of payment company, which he expects to grow to $1.3 billion by 2028. Twitter currently lets users tip creators, buy Super Follows, and interact with limited shopping features that redirect users to supplier websites to make purchases. Now that Musk is one of the co-founders of PayPal, he may see some room to expand.

The times notes that Musk also expects Twitter to earn an unspecified portion of the revenue from: data licenses, a company that sells the millions of daily tweets on its platform to companies and developers who analyze the data for market insights or consumer trends. Last year Twitter made $572 million (PDF) in data licensing and “other revenue,” but it’s unclear how or if Musk plans to expand this business. If Twitter were to resell individual tweets, our editor-in-chief Nilay Patel points out that Elon should “radically change the terms of service” of Twitter, not to mention “huge issues with revshare and fair use” as the copyrights of tweets belong to the users who posted them.

Building out Twitter’s services will take some work, a likely factor behind Musk’s plans to hire 3,600 additional employees. The times notes that Musk aims to have 11,072 employees by 2025, though the pitch deck reportedly shows Twitter’s workforce increasing in 2022 and then falling in 2023 before moving back up.


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