What Is Twitter's Product?
I think the answer to that one is simple, it's an online forum or community. It's also a type of social media. That's a problem in itself, because social media is generally thought to be something unhealthy, especially if used in excess. Things that make it unhealthy include the ability to be obnoxious while concealing one's identity and the ability to portray onesself in highly favorable terms -- and especially in light of the latter, social media can be depressing when people look at their own lives and worry they don't measure up to the happy lives other users represent themselves as living.
On one hand, Twitter's format, unlike Facebook, limits factors like conspicuous consumption or completely fake profiles by people who post photos of supermodels as themselves. On the other hand, there's the same pressure anyone else has to conform to the perceived values of the group and avoid controversy. In Twitter's case, celebrities, politicians, and pop culture figures tend to set the tone, and there's inevitable social pressure to avoid unpoularity. The "like" function for tweets reinforces this, although Twitter doesn't currently have a "dislike" function.
Another factor is that, like most online communities, Twitter is "free", although you need some type of computer and an internet connection to use it (it's possible to get no-charge access via a public library). Thus it operates via the 20th-century broadcast model, there's no specific charge to watch or listen to a show or read or post a tweet, and the cost to produce the platform is covered by advertising. While this model has been modified for broadcast media like cable TV or satellite radio, there's currently less use of a subscription model for online social media, which continues to be "free".
This is a big part of Musk's problem. He seems to be mulling ways to monetize a service that's normally "free", like charging a monthly fee to have a blue checkmark, but this changes the value to the customer for having a blue checkmark. Under the pre-Musk regime, the Twitter staff was seen, at least by conventional opinion, as altruistic and authoritative. If they issued a blue checkmark, it was a sign of particular favor independent of someone's ability to pay. Musk upended this dynamic.
In fact, if Twitter didn't make money, notwithstanding it was a capital corporation intended to make a profit for its investors, that would have been a plus in the minds of its customers. They paid nothing, but they got a perception of quality irrespective of money or profit, in effect the PBS variant of the broadcast model, with financial angels making up the difference. Advertisers and investors could support this as a type of virtue signal. This was probably also a major factor in the corporate culture, which we saw in the "My Day at Work" TikTok video, where the narrator saw an undemanding but five-star luxury environment as a validation of her own merit, irrespective of any particular contribution she may or may not make.
Any attempt by Musk to make people pay for something they'd been getting for free contradicts this overall sense of natural validation that both Twitter users and Twitter employees shared, and it's reflected in the bitterness that the overall Twitter community now feels toward Musk. The whole culture was based on people getting something for nothing and feeling good about it because they deserved it. The problem was that the perceived something they were getting was actually worthless, not too much different from FTX's crypto currency. It was just another social media platform with all the unhealthy features of any other. But the workers prospered, while the investors and advertisers felt good about themselves. Twitter was a close cousin of PBS. It catered to the gentry, while it cost nothing.
I don't think Musk is any sort of hero in this saga, any more than the child who blurts out that the emperor has no clothes. The problem there is the child invested no money in blurting it out, while Musk spent $44 billion to prove the same thing. Unless he's a lot smarter than I think he is, he isn't going to be able to remake the social media business model to recoup any of that investment. But then, Warren Buffett has already said he wouldn't invest in Tesla. Nothing really new here.
