Twitter's blue tick dilemma and ethics of business strategy
Dystopian reality or smart business strategy
Utkarsh wrote this interesting piece in The New Indian Express about Aristotle’s importance for startups. Before you start today’s newsletter, give it a read.
Now let’s get started with the talk of the town.
Almost 50% of Twitter’s employees have been fired in an unceremonious way. Some woke up to find their email access revoked, data wiped out remotely and terms of exit spelt out in stone. The final email they received was signed by “Twitter”. Some wonder why the new boss Elon Musk who loves to communicate via the platform didn’t send out the mail himself, perhaps like the founders of Stripe who also let go of a large chunk of their employees.
Anyway this newsletter is not about how Twitter decided to fire people. We will explore its proposed plan of charging $8/month for the coveted blue tick that signals you are who you say you are, and have credibility. In other words, status.
It might be useful to review our newsletter on status as a service. Two key points emerge from Eugene Wei
· People are status-seeking monkeys
· People seek out the most efficient path to maximizing social capital
It is difficult to imagine media without Twitter. In fact, media is Twitter. Despite its utility it has remained an undermonetized product despite acquiring newsletter platform Revue and obliterating Clubhouse with its audio-first Twitter spaces that is now being copied by LinkedIn and Facebook.
Twitter has approximately 500 million users (~250 million daily active users), makes $5 Billion in revenue (still no sign of profit) more then 92% of which comes from advertising. Twitter’s mobile app has only seen approximately $6.4 million in worldwide consumer spending to date. 0.1% of its users, approximately, 500,000 have blue ticks next to their names. These are typically celebrities, politicians, top CEOs, media professionals and creators with large following.
Thus far the final decision to grant blue tick rests with Twitter. You couldn’t really provide documents and make a case for yourself.