A few days ago, soon-to-be Twitter owner Elon Musk (should the deal go through) casually tweeted about introducing a fee for some users of the service. “Twitter will always be free for casual users, but maybe a slight cost for commercial/government users,” he wrote.
It sounds almost inconsequential, but it appears that Musk’s plans for that future arm of Twitter’s business are bigger than it seems. According to The New York Times, which has obtained Musk’s pitch deck for investors, Musk has an incredibly ambitious plan for Twitter’s next couple of years, and that plan doesn’t rely on advertising revenue.
Here’s the rundown: Musk plans to increase Twitter’s annual revenue to a whopping $26.4 billion by 2028, up from $5 billion in 2021. By then, he also plans to reach 931 million users, up from 217 million at the end of 2021, with average revenue per user also increasing to $30.22, up from $24.83 last year.
Right now, Twitter makes 90 percent of its money from advertising. But Musk plans to reduce the company’s reliance on ads, and this is where that “slight cost for commercial users” comes in – by 2028, Musk plans to generate $12 billion in revenue from advertising, and $10 billion from subscriptions, with the rest of the revenue coming from payments, data licensing, etc.
This could mean a massive change to how Twitter operates right now. Yes, the company has an experimental, paid version called Twitter Blue (Musk also plans to have 159 million subscribers for that by 2028), but the basic version of the service is free for everyone. Musk seems to think that businesses and governments will see enough value in Twitter’s platform to start paying a fee to access it, a hypothesis that hasn’t yet been tested on a major, general purpose social media platform. Twitter’s major competitors, such as Facebook, Instagram, TikTok, and Snapchat, are all free, but make the bulk of their money in advertising.
It’s official: Elon Musk buys Twitter
According to The New York Times’ report, Musk also has plans to introduce a new product called “X,” and have 104 million subscribers to it by 2028.
To achieve all that, Musk plans to fire some employees next year, with the total number declining from 9,225 in 2022 to 8,332 in 2023. Ultimately, Musk plans to add more employees to Twitter, with the total number being 11,072 by 2025.