Is Elon Musk going to put X behind a paywall?

19 Sep 2023

Image: © ImagesRouges/Stock.adobe.com

The billionaire has made misleading statements in the past and charging all X users could be disastrous in such a competitive market.

Elon Musk has hinted that X – formerly known as Twitter – may be moving behind a paywall for all users in the future.

In a video interview with Israeli Prime Minister Benjamin Netanyahu, Musk said the company is moving to have a “small monthly payment” to use the site. But as is typical with claims made by the billionaire, no time frame or price was given.

This would not be the first time Musk introduced subscriptions to the platform since he took ownership last year. One of the biggest changes he made to the website was to introduce a monthly subscription for users to be verified.

But charging users for an optional service is a different idea to putting the entire site behind a paywall, especially in such a crowded, competitive sector.

Why would Musk charge X users?

In his discussion with Netanyahu, Musk said the purpose of introducing a fee would be to eliminate the use of bots on the platform, as bots currently cost little to make.

“If somebody even has to pay a few dollars or something, some minor amount, the effective cost to bots is very high,” Musk said.

This is similar to the argument Musk made when he spoke of charging users for verification. It is unclear how effective this move was at eliminating verified bots, though it hasn’t stopped misinformation stemming from blue-ticked accounts.

But while Musk spoke about bots, there is also the financial incentive to consider, as X has been in financial difficulty for some time. Earlier in 2023, Musk hinted that things had been “extremely tough” and suggested last year that the company was heading towards bankruptcy.

It is hard to verify financial claims Musk makes about the company since he took it private last year. But in January, managing editor of The Platformer, Zoë Schiffer, claimed X’s revenue was down 40pc year over year.

In June, The New York Times claimed X’s US advertising revenue from the start of April  to the first week of May had dropped 59pc compared to the same period last year.

What would happen if X went behind a paywall?

While the decision could reduce the number of bots on X, it could also significantly reduce the number of users too.

Various copycat sites have emerged or gained attention since Musk took over the website, such as Mastodon, BlueSky and Meta’s Threads, which are all free to use. The number of free social media sites that are available means its a risky decision to charge everyone a monthly fee to use X.

The controversial rebranding of the site to X also has not helped retain the loyalty of its userbase. In the weeks after the rebrand, the site’s weekly active users fell by 4pc, according to an analysis shared by TechCrunch.

Is Musk telling the truth?

Time will tell if Musk sticks to this decision or if its another off-the-cuff statement, but it is important to note that he has turned back on statements he has made before.

For example, there was a wave of confusion earlier this year when Musk appeared to challenge Meta owner Mark Zuckerberg to a fight, which Zuckerberg appeared to agree to.

This story gained waves of media attention, but as the months rolled on it became apparent that Musk had no intention of going through with this match. After making outlandish requests such as hosting the fight in the Colosseum in Rome, Musk appeared to postpone the fight due to physical health issues.

Musk also claimed that he had secured funding to take Tesla – another one of his companies – private in 2018, which caused stocks to soar.

This was later shown to be false and forced Musk to pay millions in fines and legal fees, though he was found to not be liable for any losses experienced by Tesla shareholders over the controversial tweet, CNN reported.

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Leigh Mc Gowran is a journalist with Silicon Republic

editorial@siliconrepublic.com