Elon Musk announced three months ago a $11 per month membership service that would grant Twitter users a blue verification check mark.
On Sunday, Meta Platforms Inc. launched much the same thing: a $15 membership service allowing customers to receive a blue verified badge in exchange for presenting a form of official identification.
CEO Mark Zuckerberg is a shameless copycat, according to meta. He introduced Reels, a TikTok ripoff, copied the live video service Periscope with Facebook Live, and copied Snapchat's Stories feature (even renaming it "Facebook Stories"). The plan is effective. Several of these knockoffs, such as Stories and Reels, are popular on Instagram.
This will probably be the case with Zuckerberg's new subscription service, despite the fact that it initially seems quite unappealing. Who would want to pay to provide their ID to Facebook? The problem is that this isn't really intended for Facebook and Instagram regulars. The target audience is producers, especially those on Instagram, and reach is the main selling factor.
Partnering with brands and posting sponsored content are the usual ways that creators profit. An expert foam roller may be lauded by a fitness influencer in a post, for example. The number of "likes" these producers receive, which often correlates with views, determines how much money they can charge for sponsored material. As a result, these artists live and die by the number of "likes" they receive on their posts. Also, the "enhanced exposure and reach" provided by Meta's new subscription service in search and recommendations. The corporation is portraying this as being about verification, but in reality, it's about giving some postings a better opportunity to go viral.
According to The Information, Twitter's subscription service has failed, and as of January 2023, just 0.2% of American users of the social media platform had paid for memberships like Twitter Blue. On Instagram, though, the approach has a considerably higher likelihood of success because of the promise of reach. Many influencers will conclude it is worthwhile to spend $15 a month to make their content stand out.
Bloomberg Intelligence analyst Mandeep Singh estimates the new service could add $2 billion to $3 billion to Meta’s annual sales, which is a fraction of Meta’s $117 billion in revenue last year but probably more than what the company is making from the metaverse. Singh said in a note that the service would also help keep creators from moving over to TikTok.
In fact, its greatest effect will be to keep the most engaging producers on Meta's platforms, guaranteeing that millions more consumers would watch Reels rather than TikTok. New Zealand and Australia are the first countries to receive the subscription service, but when it spreads to Europe and the US, producers will test how much of an audience $15 can actually buy.
Creators are known for compulsively checking their likes and re-posts, so they will quickly learn whether or not the subscription is successfully amplifying their material. No simple task, this. According to a story in the tech journal Platformer, Musk hustled his senior engineers last week to magnify his postings to Twitter followers as a key priority, but they ended up going too far. Regular Twitter users saw their feeds were flooded with postings from the billionaire a day after Musk complained that his Super Bowl tweet received fewer views than Joe Biden's. Musk responded by offering to walk the feature back when they protested.
Meta must avoid making the same error. Users will move to TikTok if they begin to feel that their feeds are starting to contain more promotional material.
Zuckerberg is skilled at taking unprofitable ideas and turning them into something profitable. He did so with Stories, which didn't end up bringing Snap Inc. the same kind of financial gain that Meta did. Also, Meta has been pondering the concept of charging users for features for years, but it has never had the guts to take the plunge. The introduction of fees for other services should be simpler for Meta now that Musk has paved the way for Zuckerberg to follow, helping the business offset the tens of billions it is spending on the metaverse and address a decrease in online ad expenditure.
Also, Zuckerberg's new service is a covert acknowledgement that Facebook and Instagram are no longer true social networking sites. They are becoming destinations where people go to be entertained. Instead of promoting posts from friends and family, Meta's AI increasingly imitates TikTok to place popular posts from unknown users into people's newsfeeds.
Now, Zuckerberg must strike a careful balance between providing consumers with what they want and providing artists with the exposure they desire. Musk is having difficulty doing it for Twitter. Very likely, Zuckerberg has a better chance.
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