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Twitter Switches To Subscription Model As A New Revenue Stream

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Targeted ads are a common way for social platforms to make money, and it accounts for a large portion of revenues. But Twitter seems to be making changes to its business model. According to Bloomberg, Twitter is looking to the subscription model as an alternative to advertising revenues. 

This comes on the heels of a report in July 2020 that Twitter plans to hire a web engineer for a project called “Gryphon.” The details of that job listing gave some clues about a subscriptions model. But now, Twitter talks about it more openly. 

Twitter is currently considering several options as new ways to make money. The first one is a subscription model by the code name “Rogue One” at internal conversations. Twitter has been working on this option for a while, and they believe this is a more durable and consistent model than advertising.

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“While we’re excited about this potential, it’s important to note we are still in very early exploration and we do not expect any meaningful revenue attributable to these opportunities in 2021.” Bruce Falck, Twitter’s head of revenue products, said in a statement.

Another option is “tipping”. It means users can tip the people they are following to appreciate their unique content. Many popular accounts are active on Twitter and tipping can encourage content creators to strive for more interesting and informative content. 

Adding “undo send” and profile-customization features are other possible ways. Also, Twitter users have been looking for the “edit” button, and Twitter may decide to add this as a premium feature. Indeed, using the Tweetdeck may incur a fee. 

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These are Twitter’s ways to generate more revenue and reduce reliance on advertising. The launch date is not clear yet, but it is clear that in 2021 Twitter will experience serious changes. 

Transforming to a subscription model is a double-edged sword for Twitter

What Twitter did during the 2020 United States presidential election could influence its advertising revenues. Twitter came under fire after it restricted Trump’s account for spreading misinformation and labeling government officials’ tweets.

The backlash that Twitter received worried the investors. Now, the company is seeking to reassure investors with new revenue streams. Recently, Twitter acquired Revue, a newsletter platform that allows users to subscribe to the newsletters.  The service is still free, but it may charge fees in the future. 

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Advertising has been the mainstay of Twitter for many years, and ditching it won’t be an easy process for the San Francisco-based company. Social networks’ nature is free, and users are unlikely to pay for a social platform unless it has something unique. What unique does the Twitter subscription model offer? This is a question that Twitter must answer before moving toward a subscription model.