"5.8 Billion Won Revenue Generated" Musk Goes All In on Twitter Monetization

Generating 5.8 Billion KRW in Revenue Upon Success

[Asia Economy Reporter Yujin Cho] Elon Musk, CEO of Tesla, is driving changes at Twitter, which he acquired, by focusing all efforts on monetizing the platform.

According to the Wall Street Journal (WSJ) and others on the 1st (local time), Musk plans to raise the subscription fee for the existing paid service "Twitter Blue" from the current $4.99 to $8 and introduce a system where only members subscribed to this service will receive the account verification mark (blue tick).

Musk wrote on his Twitter that day, "We plan to charge $8 per month for the Twitter Blue service," adding, "Anyone who wants to get the account verification mark must pay."

He said, "This will allow us to prioritize replies, mentions, and search exposure, which is essential for preventing spam and fraud." He also announced plans to reduce the amount of ads shown to paid subscribers by half.

Launched last year in four countries including the U.S., Twitter Blue offers additional services such as tweet undo, customized navigation, and the ability to upload long videos.

He also plans to revamp the verification system, which currently provides a blue checkmark free of charge to celebrities, politicians, and journalists, and expand it to Twitter Blue subscribers.

Initially, there was consideration to raise the monthly subscription fee for Twitter Blue from $4.99 to as much as $19.99, about four times the current rate, but this faced strong backlash due to the steep increase.

In response to a tweet by author Stephen King criticizing the price hike, Musk replied, "We have to pay the bills somehow. We can't rely entirely on advertisers forever," and asked, "How about $8 a month?"

Foreign media reported that this monetization overhaul will be the biggest change in Twitter's business since Musk's acquisition.

The reason Musk is going all-in on Twitter monetization is to break free from advertisers' influence. Currently, Twitter's main revenue source is tweet advertising from corporate accounts. Twitter generated $5.1 billion in revenue last year, about 89% of which came from advertising services. Twitter's corporate value was estimated at $44 billion, but there is no significant revenue model outside of advertising yet.

The number of users with Twitter account verification marks is 423,700, and if 10% of them subscribe to the $8 monthly paid service, Twitter could generate an additional annual revenue of $4.1 million (approximately 5.8 billion KRW).

However, it is questionable whether this monetization attempt will be effective. In a Twitter poll conducted by Musk's advisory investor Jason Calacanis, among 1.2 million respondents, over 80% said they would not pay to get account verification, and the remaining 10% said "$5 per month is reasonable."

When Musk first announced his intention to acquire Twitter last April, he promised major changes, saying, "If I acquire Twitter, I will improve the product with new features and increase trust by making the algorithm open source."

Over the past weekend, Musk also hinted at launching numerous new products by conducting a survey among Twitter users about reviving 'Vine,' the short video service app that was shut down in 2016.

After completing the acquisition of Twitter on the 27th, he dissolved the board of directors and consecutively fired key executives including CEO Parag Agrawal, CFO Ned Segal, and CLO Vijaya Gadde.

This content was produced with the assistance of AI translation services.