We can’t say we were not warned. Last month, in a livestreamed conversation with Israeli Prime Minister Benjamin Netanyahu, X Holdings CEO Elon Musk said as much.
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X, the social media platform once known as Twitter, would begin charging “a small monthly payment for use of the X system.” The fee is needed, Musk said, to purge X of the “vast armies of bots” that have taken up residence on the site. (These 20 American companies have the worst reputations.)
$1 Annual Fee
In a company tweet posted late Tuesday, X announced it would begin testing the new fee in a program the company calls Not a Bot:
Starting today, we’re testing a new program (Not A Bot) in New Zealand and the Philippines. New, unverified accounts will be required to sign up for a $1 annual subscription to be able to post & interact with other posts. Within this test, existing users are not affected.
This new test was developed to bolster our already successful efforts to reduce spam, manipulation of our platform and bot activity, while balancing platform accessibility with the small fee amount. It is not a profit driver.
And so far, subscription options have proven to be the main solution that works at scale.
In the document linked at the end of the tweet, X said it would charge the fee only to new accounts established in the Philippines and New Zealand. Existing users in those two countries or anywhere else will not be affected.
The $1 annual fee gets new users the ability to post content and like, reply to, repost, quote and bookmark posts. New premium users or members of X-verified organizations will not have to pay the $1 annual fee.
Battling the Bots
Users who refuse to pay the $1 fee (or any other subscription charge) will only be able to read posts, watch videos and follow other accounts.
According to Musk, it costs less than a penny to set up a bot. Establishing a price for a new account will keep bots at bay. In his conversation with Netanyahu, he said, “[E]very time a bot creator wanted to make another bot, they would need another new payment method.”
Scammers, however, appear to be willing to pay X’s premium fees. In Twitter’s pre-Musk era, the blue check indicated a verified account. Now the blue means only that the account has paid the fee. A serious phishing scam has no problem paying the $8 monthly fee or even the $1,000 monthly organization fee. The latter receives a gold badge that indicates its status.
24/7 Wall St.One thing the $1 annual fee will not solve X’s financial issues. In July, Musk said in a tweet that the company is losing money because it lost half its ad revenue. Musk borrowed some $13 billion when he acquired Twitter last year, and Bloomberg reported that interest payments on that debt run to around $1.2 billion annually.
Musk claims that X has 550 million users worldwide. Even if every one of them paid the $1 fee, that pays less than half the annual interest. That helps give X a positive cash flow, but it is not enough.
The obvious solution is to charge all 550 million users a couple of bucks a month. Is it worth it to X’s users to pay to eliminate bots? Is Musk willing to take that chance? Here’s betting he is.
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