The Paywall of Death

Not content with rebranding Twitter to X — and with it, destroying 15 years of brand legacy that was baked into the cultural fabric, all in favor of a whimsical, petulant obsession with a letter — Musk has a new plan that is sure to destroy what little is left.

To put the entire platform behind a paywall. 

During a live-streamed conversation with Israeli Prime Minister Benjamin Netanyahu yesterday, Musk said X would come out with a “lower tier of pricing” of “a small amount of money” that all users would have to pay, in addition to the premium service, X Blue. His reasoning behind the surprise statement is that it is the “only way [he] can think of to combat vast armies of bots.” His theory goes that bot accounts can be set up for pennies, so forcing everyone to pay something, even a few dollars, makes running vast bot campaigns much more expensive and may deter some of the biggest perpetrators.

I see two immediate problems. 

1. Why do we assume that the bots won’t continue regardless? Since Musk took over, the bot problem seems to worsen with each passing day. A few dollars may add up, but it's still relatively cheap if bad actors can use these accounts to sway public opinion, smear somebody, or scam somebody.

2. It will prove wildly unpopular, and many will head for the exit door. What good is removing bots if the majority of the user base also leaves? It’s all good and well waxing lyrical about creating a public town square. But fulfilling its potential requires a mix of people, races, beliefs and opinions — not just an army of Musk fanboys in an echo chamber. 

The truth is, if the paywall does materialize, bots are only a cover story (just like it was when he tried to dodge out of the deal to buy Twitter in the first place). 

The platform is still negative cash flow due to the ~50% drop in advertising revenue plus the heavy debt load now strapped to X thanks to the takeover. His big play, X Blue, has failed. The service, which Muck hoped could reduce reliance on ad dollars, is still languishing around the 650,000 mark. That means it generates around $5 million annually, a far cry from a) the ad revenue, over $4 billion in 2022, and b) the $44 billion Musk needs to claw back eventually. What this goes to say is he needs revenue, lots of it, and soon. Premium is failing. The executive team is failing to bring companies back to the advertising table. So what option is left? But despite feature-loading the premium offering, admittedly with some completely pointless extras, the uptake has been low. So, why would users pay to use the very basic level of the site? The answer is obvious — they won’t. 

It will be a paywall of death. 

Making it harder for regular users to engage with a platform they are already losing patience with will cause a huge drop in user numbers. As a direct result, advertising reach will shrink further. In a vicious cycle, more and more companies will stop advertising, and revenue will continue to dry up. Important facets like news and sports will stop posting — this may happen anyway with Musk’s intent to kill their reach — and X’s ability to be at the forefront of culture will evaporate. Slowly but surely, a paywall will kill what relevance X has left. Without relevance, there will be no revenue. Without revenue, it’s over. 

To caveat all of the above, I actually think we should pay for the services we use. In a world of generative A.I., the only way many social platforms will survive is by being human-first. Musk’s crusade against the bots, however misjudged, is in some ways the right battle to be fighting. But asking users to pay for platforms must come with the guarantee that we are no longer sold to advertisers like lambs to the slaughter. X has gotten halfway to this but couldn’t give up those sweet ad dollars. “You’ll see better ads,” they told us, only to show us gutter-level adverts because all the bigger companies packed their bags and fled. So, in reality, we now pay to see shittier ads. Should Musk follow through with the possibility of paywalling the entire platform — unlikely, of course — the same problem will remain. We won’t get an ad-free service. We won’t even get “better” ads. Our every click, scroll and engagement will still be sold because the truth is ad revenue is all that will keep X afloat. Except now, we'll pay for that “privilege.”

The only answer I can see to solve the bot problem is to verify every human on the platform. And I mean proper verification that proves you are indeed the human you claim to be, not just a tick you can pay for. The only way to convince the entire user base to buy into this will be to make it a free service. Even then, there’s so much distrust (and rightly so) toward tech companies and those running them that I’d assume huge chunks of the user base would point-blank refuse to give their details to Musk. Maybe this just brings it all back full circle to the reality that there is no answer and that the platform is just running its course, inching ever closer towards its natural death, at which point it will be replaced by something else. 

Since Musk arrived, the platform has toyed with self-destruction on multiple occasions.

His finger has never been closer to pushing the big red button.